Nearly all employers responding to a consultation on the University and College Union’s (UCU) proposal to complete the 2020 valuation for the Universities Superannuation Scheme (USS) do not support it, according to an update from Universities UK (UUK).
Ninety-three of 97 employers, representing over 92% of active membership of the scheme and over 98% of those responding by weighting, did not support the proposal, UUK said.
Three employers indicated conditional support for the proposal, and one employer provided support.
UUK, which is the nominated representative for over 340 employers in the USS, said it would “look to share further detail of the consultation responses shortly”.
Employers had until 18 February to provide UUK with their feedback.
The launch of UUK’s consultation with employers came amid the beginning of 10 days of strike action at 44 universities, and after a confirmation of costings by the USS trustee.
On 15 February, USS posted a “clarificatory note” on UCU’s proposals for on its website. It said it had confirmed there was no operational impediment to implementing the elements of UCU’s proposals that deliver an outcome for the 2020 valuation.
It set out what those elements were, and that it meant UCU and UUK representatives on the Joint Negotiating Committee (JNC) agreeing to commit to member and employer contributions escalating to 13.9% and 29.1%, respectively.
The JNC is made up of UCU and UUK representatives, plus a chair, and decides what benefits are provided by the scheme and how the contributions to fund them are shared between members and employers.
USS said it had not commented on other aspects of the UCU proposals and that if a formal request were made by the JNC to consider a 2022 valuation, separate to discussions in respect of the 2020 valuation, the trustee board would consider this at that time.
“Our initial assessment is that it would be extremely challenging to complete the required processes in time (as part of a 2022 valuation) to intercept the contribution increases for members and employers that would otherwise apply from 1 April 2023 under UCU’s proposal”.
These increases are to the contribution rate, from 25.2% to 26.5% for employers, and 11.8% to 12.5% for members.
UCU’s proposal foresees employer contributions being capped at 25.2% from 1 April 2023, but UUK has questioned how this could be legally and formally achieved.
UCU rebutted that it had set out a viable mechanism, pointing to a blog written by Michael Otsuka, one of UCU’s USS alternate negotiators.
According to Otsuka, an unnamed pensions lawyer had proposed wording for an amendment of the scheme rules and this provided “all the assurance UUK needs that it will be able to keep rates capped at 25.2% and 9.8% from April 2023”.
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