On the go: The University and College Union has claimed that approximately £0.5bn in pension benefits cut by Universities UK could be paid back to around 200,000 staff in the Universities Superannuation Scheme.
In October, the UCU secured a mandate to strike in 150 universities over cuts to USS members’ benefits.
The USS 2020 valuation is at the centre of the dispute, which yielded a £14.1bn deficit. Cuts were proposed that were based on this valuation.
The scheme has since recovered to a surplus of £1.8bn and unions are opposed to reform proposals agreed between the USS trustee and UUK, which represents USS employers. These pledged greater covenant support and a moratorium on scheme exits in exchange for a comprehensive governance review.
UCU has long argued that cuts to pensions were unnecessary and should be reversed, and has conducted several rounds of strike action.
On October 27, the UCU claimed that a recent USS update “shows the scheme is in such a healthy position that those lost benefits could be paid back, backdated to April – and still leave the scheme in surplus”.
Retroactive restoration, which would lift the accrual rate from 85ths to 75ths, would cost £0.5bn.
“This amount is less than the £0.57bn employers and employees are paying each year into the scheme to close the £14.1bn deficit, which no longer exists,” the UCU said.
UCU general secretary Jo Grady said that “all arguments against restoring benefits have now gone up in smoke”.
“If employers want to avoid strike action they must restore benefits,” she warned.
A UUK spokesperson said: “According to the USS trustee’s regular monitoring, the funding position of the scheme has improved, which is very good news.”
However, the USS trustee has repeatedly advised that its funding updates should, at best, be viewed as a broad indication of the direction of travel and should not be seen as an indicator of the likely outcome of an actuarial valuation.
The USS trustee added that, given the volatility of the financial markets, it does not believe there are grounds to alter contribution levels or benefits ahead of the next full valuation – scheduled for March 31 2023.
“UUK representatives will continue to meet regularly with UCU, both informally and formally, in the hope that by working collaboratively we can accelerate the next valuation, to deliver any improvements to scheme members as soon as possible.”
