USS pensions: how to fix the worst offer I’ve seen from an employer in 20 years

Sally Hunt offers three ways to fix the proposed USS pension reforms

December 1, 2017

I have been involved in some tough negotiations over the years in higher education, including two extended periods of national industrial action in 2004 and 2006. So when I say that the proposal currently on the table from Universities UK to reform the Universities Superannuation Scheme is the worst offer that I have seen from an employer in 20 years, I hope that my words have some credibility. 

The proposals will pick the pocket of a typical lecturer by more than £200,000 over the course of their retirement and will open up a near £400,000 gap between the retirement payments received by academics in post-92 universities, who are members of the Teachers’ Pension Scheme (TPS), and USS members.

When I say that the offer is bad, I, of course, mean for my own members, but it is also bad for the universities on whose behalf it has purportedly been made. As the University of Warwick’s vice-chancellor noted this week, creating such a difference in treatment between academics in one part of the sector compared with another is simply not sustainable in the long term. 

I could churn out thousands of words on how we got into this mess. We could talk about how UUK ignored the mandate that they had been given by universities to retain defined benefits in favour of the most hard-line proposals possible. We could reflect on the startling revelation that UUK put forward these proposals without publishing any modelling on their likely impact on staff or universities.

We could ruminate on the role of the USS itself in setting the absurdly conservative deficit methodology that has created the current crisis. We could ponder how universities, which on any analysis can afford to pay more to secure the fund, have allowed themselves to become this year’s pantomime villains. 

But I prefer to be constructive. We know how big a hole has been dug; how do we get out of it so that we can avoid damaging industrial action?

I have three simple ideas to get us back on track. 

First, sensible vice-chancellors need to take back control of the negotiating agenda from the hardliners in UUK who have got the sector up in arms. In the end, it is they who will have to face staff who already feel undervalued and see this attack on their retirements as the last straw. 

So act now – don’t just publish blogs or open letters – get involved and tell your national negotiators to change course. And get in touch with me as well – I have been saying for months that my door is open to any vice-chancellor or principal who genuinely wants to help us sort this out. 

Second, we need to deal with the elephant in the room that is the USS itself. I was staggered this week to be told by the USS that I had until 18 December to reach a negotiated solution or one would be imposed. Does the USS realise that it is playing with fire here? 

The University and College Union will not be rushed or pushed into accepting something that will damage relations between universities and their staff for a generation, and I hope those sensible vice-chancellors would agree with me that the USS needs to back off now.  

If they don’t, and this shoddy proposal is imposed, my view is that we will see industrial action at a level and over a period that we have never seen before, such will be the justified rage of staff. They will seek recompense from their own employer for loss of their retirement income, and far from being over, the dispute will just be beginning. Surely nobody wants that? 

Third, and finally, given that this is the third time that my members have faced cuts in their pensions since 2011, we need to spend some time thinking about what comes next if we can settle this dispute. It is difficult to see how the USS is adding benefit to the employment packages that universities are offering, especially when compared with the far superior TPS. 

So, when I hear exasperated vice-chancellors proposing the nationalisation of the USS, you bet that I am interested. It would be tricky, it would be challenging, but could it be worse than the current mess? 

We must find a way out of the current impasse before students suffer, and we must then make sure that this debacle never ever happens again. 

Sally Hunt is general secretary of the University and College Union.

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