Defend your USS pension rights

This section contains important information about negotiations between UCU and the employers on the future of the USS pension scheme.

When completing the USS Consultation please use these model answers but we would encourage you to modify the text to individualise your response by drawing on your own experiences.

Model answers for USS Consultations (click here for further model answers):

Complete by 22nd December 2010

1. Normal pension age of 65

This is, generally,a reasonable proposal. To be fair to members who have many years in USS but who would be caught by this it must be phased in more gradually.

2. Actuarially reduced early retirement benefits

In these circumstances, the cost of actuarial reduction is currently carried by the employer this a condition of employment, not a pension issue. USS's should not dictate who pays the strain cost. This proposal should be removed. Any such proposal should be the subject of separate negotiations.

By introducing this change USS would be colluding to make it easier for employers to make staff redundant. A pension scheme should be independent of this sort of threat.

3. Flexible retirement arrangements

No objection

4. Contributions and cost sharing arrangements

It is fair that members should share some of any additional future costs but I do not support the current proposal. The proposal made by UCU, to have a sliding scale for contributions related to salary, should be introduced.

Future cost sharing may be fair but the proposal allows a future potential for the employer's contribution to drop significantly (and even become zero) whilst the member's contribution would not fall below 7.5%. This is unacceptable.

5. Caps on pensions increases and on revaluation of deferred benefits

This proposal is entirely unacceptable.

a. It impacts upon pensions in payment - on those who are beyond being able to take steps to mitigate this.

b. The shift in link to the CPI, rather than RPI is NOT essential. Whilst USS increases are currently linked to the public pension arrangement there is no reason why this cannot be changed to allow increases to remain linked to RPI as USS is NOT a public scheme. The move to a CPI link will bring a SIGNIFICANT adverse effect to pensions, even in times of low inflation.

c. The cap on pension increases is not acceptable. During times when inflation is high investment returns are also generally high so the fund is gaining increased income whilst penalising pensioners. It is also particularly harsh on those who have had to leave their pension behind for any reason.

d. The cap that would be imposed after a service break would be particularly unfair on women who may take career breaks to raise children.

e. Surely the whole point of a defined benefits scheme is to provide some future certainty for those in receipt of the pension. Without a realistic increase mechanism this cannot exist.

6. New CARE-like benefits section for new entrants

The proposal for CARE is unacceptable as it is a very poor scheme. By introducing such an unattractive scheme there is a risk that people would not join. This may put the future of BOTH schemes in jeopardy by turning an immature scheme very rapidly into a mature scheme that may become unaffordable.

The fact that members who have left the scheme cannot rejoin after such a short gap is extremely unfair to women and to those who have struggled to find permanent employment within the sector.

7. Other

The nature and scale of the proposals are out of all proportion to the current and future funding situation within USS.

The package of proposals is detrimental to both existing and future members of USS. It creates a highly divisive and damaging two tier benefits system. The challenges facing USS could be dealt with without reducing benefits by adopting the UCU proposals. The USS Board has a moral duty to listen to fund members, and not be pushed into implementing the extreme and unnecessary package of proposals made by the employers.

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