Valuation update for our members

In March, we told you about the ‘76.1 report’ – a document written by the Scheme Actuary that outlines the cost of funding USS, including details of the contributions we need from members and employers in order for the scheme to continue offering the current level of benefits.

We shared this report with the Joint Negotiating Committee (JNC), the body that represents members and employers, and they’re now considering how to respond to the funding challenges.

As the body which represents employers on the JNC, Universities UK (UUK) has developed its own thoughts on the funding position of USS and on how employers might support this, as well as the options for tackling the increasing costs of USS through its benefit design and contribution structure.

UUK is now consulting with employers on this detail, so your employer might contact you and ask for your views.

There is also likely to be a more formal statutory employer consultation with members on changes to contributions and benefits which the JNC recommends or as a result of the cost sharing arrangements under the Scheme Rules. This will take place later on in the valuation process, most likely from early autumn onwards, once UUK and UCU, through the JNC, have had time to consider their response to contribution requirements and the 76.1 report.

What else is happening?

We’re continuing to work with UUK, and the Chair of the Trustee Board, Dame Kate Barker, has given them more information on how the Scheme Actuary arrived at the required contribution rates in the 76.1 report.

As trustee of USS, we welcome the constructive steps taken by UUK to begin its consultation with employers as the next stage in the valuation process and its focus on solutions to tackle the funding challenges facing USS.

We’re also continuing to engage with the University and College Union (UCU), as the body that represents USS members, and will continue to support UCU so it can also consider its response to the funding challenges facing USS through the JNC.

Next steps

We wish to work with all USS stakeholders towards ensuring that members and employers across the Higher Education sector continue to have access to a valuable, affordable and secure pension, with a solution to tackle the funding challenges that meets the needs of members and employers, and which is in line with the laws that govern pension schemes.

We’ve committed to reviewing our assumptions once we’ve assessed the impact that any alternative proposals put forward by UUK following its consultation with employers will have on the overall risk position of USS. We’re also ready to engage further with The Pensions Regulator (TPR) on these matters and to consider post-valuation experience, if appropriate.

Resources

If you missed the recent webinar, which covered contribution rates, funding USS and the 76.1 report, you can watch it, and get a transcript, on the webinar page.

You can also check out some frequently asked questions from The Pensions Regulator in relation to the 2020 Valuation.

For more details on the valuation, including correspondence with USS stakeholders and a range of briefing documents and important information visit the valuation page.

We’ll keep you up-to-date with the latest valuation information, and will continue to support all USS stakeholders throughout the valuation process.

Remember that if any changes are implemented following the 2020 valuation, they would only affect benefits you build up in future. Benefits you have built up already would not change and are protected by law.

Published: 13 April 2021