Universities Superannuation Scheme (USS) has today confirmed it will lower the contribution level for employers from 21.6% to 14.5% from 1 January 2024.

In an update published today, the pension fund confirmed the 2023 valuation is now complete and lower contribution rates will be introduced from the beginning of next year following a consultation which launched on 20 July as a result of “significant improvement” in the scheme’s funding position.

The update said the Joint Negotiating Committee (JNC) and the trustee board met this week to consider the responses to the employer-led consultation with affected employees and their representatives.

USS said the responses were “overwhelmingly positive” and no modifications were made to the contributions and benefit changes proposed by the JNC.

As a result, the contribution rates will decrease from 9.8% to 6.1% for members and from 21.6% to 14.5% for employers.

USS said that the deeds of the amendment for improved benefits set out in the employer-led consultation, and the one-off uplift to benefits earned between 1 April 2022 and 31 March 2024, are on course to be completed in February 2024 and implemented from 1 April 2024.

USS chief executive officer Carol Young said: “We want to thank UCU [University and College Union] and UUK [Universities UK] for the positive and collaborative approach they have taken to the 2023 valuation.”

She said this has been “fundamental” for the scheme to introduce the changes to the contribution levels “as quickly as possible”.

“We will look to carry that momentum and spirit through to longer term discussions on how we can achieve greater stability – be that in the funding position, the benefit structure, and/or the required contribution rate,” Young said.

She added that with the scheme reporting a healthy surplus and positive post-valuation experience, lowering contribution rates and improving benefits was a “positive backdrop for USS as we enter the 50th anniversary years of its establishment”.

Read the digital edition of IPE’s latest magazine

Pamela is IPE's UK correspondent. Before joining IPE in May 2023, she spent five years writing about the insurance industry. During her career so far she won awards for Most Promising Newcomer in 2020 and Best Investigative Article in 2022 from the British Insurance Brokers Association, and was also highly commended at the WTW Media Awards for Insurance Features Journalist of The Year.View full Profile

More from Pamela Kokoszka

Topics