USS to allow members private markets access

Universities Superannuation Scheme (USS) defined contribution members will have access to private markets assets from February 2020, the scheme has announced.

Around 85,000 DC members will see the investment remit of their funds in the Default Lifestyle Option expanded to include an allocation to private markets, which have previously only been available to defined benefit members.

The change comes after funds invested in the DC section of USS exceeded £1bn, with the private markets portfolio worth over £17bn.

USS invests in around 320 private markets assets, including infrastructure, property, private debt and private equity.

The infrastructure assets invested in include wind farms, Heathrow Airport and Thames Water.

Commenting on the announcement, USS group chief executive, Bill Galvin, said that he was “delighted” to be announcing the initiative, which he believed will “enhance our offering to members”.

He continued: “We have always been clear that any DC investments must be within stringent cost boundaries that demonstrate value-for-money to our members and employers.

“This exciting development is being done at no additional cost to them, in line with our overall investment philosophy.”

Its private markets portfolio is run by the scheme’s investment management subsidiary, USS Investment Management Limited.

Talks between the University and College Union (UCU) and Universities UK were taking place from last week (15 January) on possible reforms to the USS.

UCU is currently balloting on whether to take further strike action over proposed contribution changed, which will close at a total of 36 universities on 28 January.

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