Universities UK seeks more information on USS 2020 valuation
11 Mar 2021
Letters written to USS Trustee and the Pensions Regulator
Earlier this month the Universities Superannuation Scheme (USS) published its 2020 valuation. Universities UK (UUK), which negotiates on behalf of 340 employers, including our University, has now written to the USS Trustee and the Pensions Regulator questioning how this valuation was arrived at, and urging review by the USS Trustee of the outcomes it has presented.
You can read the letters to USS and the Pensions Regulator in full on the USS Employers website. The Pensions Regulator is the independent body, established by government in 2004, to look after workplace pension schemes in the UK.
The 2020 valuation is used as the basis for negotiations on how much employees and employers will pay in contributions and/or how benefits to members may have to change. It is very much worse than expected and the previous valuation in 2018. The upper end of the pricing range is now around 56% of salary and the lower end circa 42%. The current rate is 30.7% (21.1% paid by employers and 9.6% paid by employees), due to increase to 11% and 23.7% in October.
We share UUK’s stated concern that: “we have not received strong or clear justification for the very high pricing decisions – and, as such, employers are very concerned that the scheme is facing an unnecessary and unjustified level of reform,” and that “the very high prices for current benefits put forward by the USS Trustee are unaffordable for employers and will risk pricing even more staff out of the scheme, particularly those at early stages of their career, thereby increasing even further the current intergenerational unfairness evident within the scheme.”
We have published a timeline of the ongoing negotiations on StaffNet. The next stage is for UUK to consult with employers, which they anticipate taking place in March and April. We will publish our response on StaffNet.
You will be kept fully up to date on developments and we are working on opportunities for colleagues to ask questions and give their views on the scheme.