UUK labels UCU letter as ‘misleading’ amid university pension crisis

Universities UK (UUK) has described some of the guidance offered to universities in the University and College Union (UCU) National Dispute Committee template letter as “misleading”, amid a row on pension contribution rates.

In the letter, UCU calls on universities to publicly support a 26 per cent contribution rate for the Universities Superannuation Scheme (USS), based on implementation of the Joint Expert Panel (JEP) recommendations in full.

However, UUK said that the JEP has “not made any statements to even suggest” that the 2018 valuation could be concluded with a contribution rate of 26 per cent or less.

“To imply otherwise is misleading,” it added.

UUK also disputed the claim that employers had made “vague allusions” to the requirements of The Pensions Regulator (TPR), pointing to a letter published by TPR in May which raised concerns over concluding the 2018 valuation with a 30.7 per cent contribution rate.

It also said it heard this position in an “informal meeting” with TPR.

“It is therefore unhelpful for UCU to suggest that employers have inaccurately communicated the position of the regulator to justify a higher contribution rate,” it added.

“The fact is that the regulator would prefer a higher level of contributions than 30.7% to fund current benefits and deficit recovery contributions.”

Commenting on the response, UCU general secretary, Jo Grady, said: "Worryingly, it looks like the employers have learned nothing from the last round of action where their preference for spin over engagement caused widespread disruption across UK universities.

"We are heading towards another round of industrial action because, instead of holding USS to account, universities are refusing to cover the cost of unnecessary extra contributions and asking members to pay more for the same pension.

"Nobody wants further disruption on campus, but universities need to engage seriously with us if they want to resolve this dispute."

UUK reiterated that it would prefer to have a contribution rate of 30 per cent or lower, but that this would not satisfy the concerns from the trustee and TPR.

The response continued: “Employers would of course want to achieve such an outcome: it is simply not in the interests of employers or members to pay higher contributions than are necessary.

“On this occasion, however, there are certain realities that render such a rate impossible while maintaining the current level of benefits.”

In its letter, UCU called on universities to demand the implementation of the JEP recommendations in full.

UUK responded by saying that the suggestion that UUK and the employers have not urged the USS to implement the recommendations is “wholly inaccurate”, and that is it “unthinkable” that employers would agree to pay an additional £250m into the scheme each year “without first exhausting every possible avenue to a lower rate”.

It also warned that employees who take part in industrial action are in breach of contract could have their pay withheld from them for each say that they took part in strike action.

UUK concluded: “UUK hopes that all USS scheme members – whether they belong to UCU or not – will recognise that the proposed outcome represents a fair and pragmatic conclusion to the 2018 valuation: it maintains current benefits and proposes to share the increase in costs in line with a solution that already exists in the scheme to solve any impasse that arises between the scheme’s stakeholders.”

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