USS benefits to be restored ‘in full’, says UUK and UCU https://t.co/3Vc7kXGRc3 via @profpensions so ends a bizarre episode where theory overtook common sense , causing needless damage to thousands of young people’s education.
— Henry Tapper (@henryhtapper) May 25, 2023
I am very pleased that the UCU has won its fight and with the University employers , agreed for member’s benefits to be restored to pre-2022 levels. UCU , the union fighting for members of USS is right to feel proud of its determined position. Here is how it announced yesterday’s news.
University pension benefits on track to be restored ‘in full’, employers and union confirm
The package of devastating pension cuts imposed on university staff last year are on track to be revoked, with benefits restored ‘in full’, said employers and UCU.
UCU has said the comprehensive restoration of stolen benefits will see UCU members recognised as ‘history makers’ of the trade union movement.
In April 2022, employers imposed a series of pension cuts which would see the average scheme member lose 35% from their guaranteed future retirement income. Employers, led by Universities UK (UUK), did this by dramatically reducing the rate at which staff would accrue benefits and the salary threshold at which defined benefits would build up. UUK also brought in an inflation protection cap, meaning, from the next valuation, benefits would only be protected against inflation up to 2.5%.
However, in a new joint statement, UUK and UCU confirmed that, pending a successful 2023 valuation and the green light from ordinary scheme members, the accrual rate and salary threshold at which defined benefits build up will both be returned to pre-cut levels. The statement also confirmed that the pre-April 2022 inflation protection will continue unchanged, rather than being reduced at the next valuation, as originally intended.
The statement also included an important commitment to explore how future benefits might be improved to take into account the benefits that have been lost since April 2022, when the cuts came in.
With the changes reversed, UCU says an average scheme member, aged 37, could see hundreds of thousands of pounds returned to their retirement fund over the course of their career.
The joint statement comes after the USS trustee reported a further growth in its surplus to £7.6bn with the cost of restoring benefits in full falling to 21.8%.
The joint statement from UUK and UCU confirmed, subject to the 2023 valuation, that:
- the pension accrual rate will return to 1/75 (up from 1/85)
- the salary threshold at which defined benefits build up will return to its pre-April 2022 level
- the inflation protection that existed prior to April 2022 will continue unchanged
- exploring options to improve benefits to a level which makes up for benefits lost since April 2022
UCU general secretary Jo Grady said:
‘When university staff demanded their pensions back, they were scoffed at, ridiculed and told to ‘move on’. But, today, they have taken another big step towards seeing their retirement benefits restored, in full. This would be an incredible victory which will see our members become history makers of the trade union movement.
‘Ever since this dispute began, university staff have backed their union and made huge sacrifices, and, in doing so, have brought the dispute close to a conclusion. But, be under no illusions, we will not take our eye off the ball for one moment and ensure every penny is returned to our members’ pensions.’
This is not yet done. The statement makes the point that restoration is still conditional. UCU and its members should not ease off until it is done.