UCU pensions proposal

Submitted by ucu-website on Wed, 02/28/2018 - 23:36

Further talks agreed in universities pensions dispute

27 February 2018 | last updated: 28 February 2018

UCU said it was pleased that Universities UK (UUK) had agreed to further talks to try and end the disruptive strike action currently affecting 61 universities

Both sides have agreed to go for further talks mediated by the conciliation service Acas, which will begin on Monday (5 March). The strike action remains on. Staff will be on strike on Wednesday (28 February) and then back out for four days on Monday (5 March). This initial wave of 14 days of strikes will then conclude with a five-day walkout from Monday 12 - Friday 16 March.

In the talks, UCU tabled a set of proposals* it said it believed could resolve the dispute. The union said its proposals were drawn from both its members' demands and ideas put forward by many university vice-chancellors^.

UCU said its plans would provide a guaranteed pension for members of the Universities Superannuation Scheme (USS) at approximately half the extra cost attributed to the union's previous proposal.

The new proposal would mean:

  • Universities accept a small amount of increased risk through a return to the risk level USS proposed in September 2017 - something the majority of institutions were happy with
  • The limit on salary counting for defined benefits remaining unchanged at £55,550
  • Annual accrual rate reduced from 1/75th to 1/80th
  • Contributions would increase by just 4.1% (split 65/35 between employers and employees) rather than the 8.3% estimated cost of UCU's previous proposal - an increase in contributions of 2.7% for employers and 1.4% for USS members

Responding to a UUK consultation, 58% of institutions said they were prepared to accept the current levels of risk or to increase the risk. It has since come to light that the 42% proportion of institutions wanting less risk (the position UUK adopted) may have been distorted upwards by giving Oxbridge colleges the same weight as universities.

In addition, UCU said it wanted to work with the employers on a number of issues to put USS on a strong footing and avoid disputes like this in the future. UCU has called for:

  • a review of the competitiveness of USS benefits, compared to those of school teachers and academics in the Teachers' Pension Scheme
  • a study of alternative ways of providing pension benefits, such as collective defined contribution (CDC)
  • a joint approach to government and other political partners with a view to them underwriting the USS scheme
  • a review of valuation methods.

UCU general secretary Sally Hunt said: 'We are pleased the employers have agreed to more talks. Today UCU tabled proposals which provide the basis for settling this damaging dispute. We have listened not just to our members, but also to the many university leaders who have contributed ideas.

'At the core of our proposals is for universities to accept a small amount of increased risk, but only at a level a majority have recently said they are comfortable with. Doing this would enable us to provide a decent, guaranteed pension at a more modest cost with smaller contribution increases. 

'UCU has been impressed by the ideas of many vice-chancellors who have intervened in the dispute. Our proposals for long-term reform reflect an attempt to reach a consensus around the challenges we face.'

* UCU proposals to resolve the dispute

  1. UCU welcomes the calls from politicians and many vice-chancellors for urgent negotiations without preconditions. For our part we are committed to resolving the dispute and welcome the opportunity to negotiate. We believe that negotiations should continue until we reach agreement.
  2. UCU proposes a wide-ranging agreement which addresses the short-term concerns of our members about the current pension cuts and long-term issues with regard to the future of the fund.
  3. UCU's policy is to retain a decent defined benefit pension for members. We have already tabled proposals with a £55,550 threshold, which employers have rejected. We reiterate our invitation to UUK to join us and explore thresholds and accrual rates which retain a decent guaranteed pension benefit.
  4. Both sides recognise that this joint work may potentially mean proposals for a modest increase in contributions.
  5. In line with the developing views of many institutions, and the invitation to explore a joint resolution, we propose that UUK and UCU immediately agree to review and adjust the current risk parameters with a view to striking the correct balance between affordability and prudence. Both UUK and UCU then make a joint recommendation to the USS Board that the current parameters be adjusted to facilitate a settlement of the dispute.
  6. UCU proposes that both sides commission an independent inquiry into alternative ways of providing guaranteed pension benefits, including collective defined contribution (CDC).
  7. UCU proposes both sides commission an inquiry into alterative valuation methodology.
  8. UCU proposes that both sides seek discussions with government and other political partners with a view to building consensus for government to underwrite the USS pension scheme.
  9. UCU proposes that both sides commission an independent review of the recruitment and retention issues that arise from the lower pension benefits available to USS members compared to those of school teachers and academic staff in the Teachers' Pension Scheme (TPS).
  10. UCU proposes that both sides commission a review with a view to avoiding damaging disputes in the future.