For Staff

USS Pension Reform following 2017 Valuation

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Latest news (23 February 2018)

Following the Joint Negotiating Committee (JNC)’s decision* on 23 January 2018, USS has started preparation for the consultation with affected employees and employee representatives.

'Affected employees' includes active members and eligible employees (who are not currently members).

The consultation period is expected to start from 19 March 2018 and to last at least 60 days.

During the consultation, affected employees will be able to log in to the USS consultation website to provide their response. They will also be able to use the interactive modeller (which will be pre-populated for the majority of active members) to see how the proposed changes affect them.

Pension regulations set out a statutory timeline for scheme valuations such as this. 30 June 2018 is the published deadline for finalising the valuation by submitting the required documents to the Pensions Regulator. Read more on USS’s What happens when? summary, available on its website alongside explanatory videos and other member information.

* The USS Joint Negotiating Committee (JNC) is responsible for making a decision about how the scheme should be structured in future, often referred to as ‘pension reform’. Universities UK (UUK, on behalf of employers) and the University and College Union (UCU, on behalf of employees) are equally represented on the JNC. The JNC has met at least 35 times on this.

At Leeds

We continue to commit to sharing information with colleagues and will support the USS affected employee consultation this spring.

We recently asked Mercer, independent pension experts, to host a series of member information and Q&A sessions for staff. You can watch their presentation video below or view Mercer’s presentation here (you'll need to log in with your University account details).  

The presentation/video covers: an overview of the current scheme structure; details of the proposed scheme changes which are due to be put forward for member consultation by USS JNC; and details of the next steps in the valuation process. Question and Answer session was not recorded. Repeat sessions are being arranged to give more people the opportunity to ask questions.

Details of the proposed reformed scheme

This information is available on the USS website:

The proposed changes, detailed below, are subject to a statutory consultation by employers with all affected employees (active members and employees eligible to join). This is due to begin in March. They would come into effect no sooner than 1 April 2019 and would only apply to benefits built up from that point onwards by active members (people currently paying into the scheme).

Benefits already earned by both active and deferred members are protected by law and in the scheme rules. Benefits already being paid to retired members are not affected by this decision.

From 1 April 2019 (at the earliest):

  • The salary threshold (the salary up to which defined benefits currently build up) would reduce to zero;
  • All future benefits, until further review, would be built up in the USS Investment Builder (the defined contribution part of the scheme), except death in service and ill health retirement benefits – see below;
  • There would be no changes to the provision of death in service or ill health retirement benefits. These would remain based on full salary regardless of the salary threshold;
  • The employer contribution would cover their cost of future benefits in the USS Investment Builder (13.25%), as well as death and incapacity benefits, the subsidy of investment management charges, deficit recovery contributions, and scheme running costs;
  • Members would continue to contribute 8% of pay, but would have access to a lower cost option of contributing 4% while still receiving the full employer contribution into the USS Investment Builder of 13.25%;
  • Members’ 8% (or 4%) would include a contribution to partly finance their death in service and ill health retirement benefits.
  • The ‘match’ – the additional 1% employer contribution currently available when members contribute an additional 1% to the USS Investment Builder – would be discontinued.

University of Leeds position

  • While we recognise that the prospect of pension reform will naturally concern colleagues, we do believe that reform is necessary. 
  • It’s important for us to have a pension scheme which is valued, sustainable, stable, portable and fair:
    • Valued: so we can recruit, reward and retain very good people.  
    • Sustainable: so the scheme continues to be affordable and secure for individuals and employers.
    • Stable: so there’s confidence in the scheme.
    • Portable: so it helps colleagues move freely around the sector to develop their careers.
    • Fair: so the scheme considers and acts on behalf of all members, regardless of age or career stage.

What has happened so far?

  • Universities UK (UUK, on behalf of employers) and the University and College Union (UCU, on behalf of employees) are equally represented on the USS Joint Negotiating Committee (JNC). The JNC is responsible for making a decision about how the scheme should be structured in future, often referred to as ‘pension reform’. This decision was due by 18 December 2017 in order to meet statutory requirements, but on 19 December, the decision was deferred until 23 January 2018.
  • Any JNC-agreed changes to member benefits or contributions necessitate a full consultation with scheme members and other affected employees in spring 2018.
  • Changes would apply only to ‘future benefits’ i.e. benefits which are yet to be accrued. Members’ benefits which have been built-up to date and before any contribution/benefit changes are implemented are protected by law.
  • In autumn 2017, UUK consulted with university employers about the valuation. The University of Leeds’ governing body (the Council) reluctantly concluded that significant change was needed to the existing scheme. That view was consistent with that of the majority that contributed.
  • UUK subsequently made a proposal to JNC, based on the consultation and on behalf of employers nationally, that:
    • future benefits would be delivered by USS Investment Builder, i.e. a defined contribution (DC) scheme, while keeping open the option of returning to defined benefits (DB) or a hybrid model should the financial outlook improve;
    • death and incapacity benefits would continue on a defined basis as they are now (i.e. scheme members would be assured a specific level of benefit) so that employers would continue to provide protection in the most difficult of circumstances.
  • UCU opened a ballot for industrial action. 
  • UCU tabled its own proposal and UUK has commented.
  • UCU announced industrial action
  • At its meeting on 23 January 2018, the USS Joint Negotiating Committee (JNC) reached a decision about scheme reform, by the casting vote of its independent chair, in support of a revised proposal from Universities UK (UUK).
  • According to USS, the JNC’s decision results in an estimated funding deficit of £6.1 billion, which means the scheme is 91% funded.
  • UUK wrote an open letter to USS pension scheme members.

Find out more

The University is committed to making information available to staff members when it can, including member updates and publications, and we will update this page as matters develop.

In the meantime, further information can be found online via the following links to the USS and UUK websites and through the monthly USS member eNewsletter, which is circulated to relevant staff at the University. 

Related links:

University of Leeds:

USS (runs the pension scheme):

UUK (represents employers):

USS Pension Updates

USS pension: information sessions February 2018

We have arranged another series of information sessions aimed at USS scheme members. You can sign up now. Sessions will be hosted by independent experts, Mercer, on 12 and 19 February 2018.

USS Joint Negotiating Committee reaches decision on pension reform

USS pension reform discussions have progressed, with the Joint Negotiating Committee coming to a decision based on latest proposals for change.

UUK comments on UCU proposal for USS pension reform

Universities UK (UUK) has commented on the University and College Union (UCU) proposal to reform the USS pension scheme.

USS valuation: further extended deadline for JNC decision

The USS Joint Negotiating Committee (JNC) agreed on 19 December to defer until 23 January 2018 a decision on the proposed reform of USS benefits.

USS pension: UUK updated Q&A and benefits modelling

UUK has published further information relating to the current proposals for changes to the USS pension scheme as a result of the 2017 valuation.

Browse USS Pension Reform following 2017 Valuation by date