University academics head to High Court over USS valuation concerns

University academics have issued proceedings in the High Court against Universities Superannuation Scheme (USS) directors regarding concerns about the scheme’s 2020 valuation process.

The legal action relates to four key claims, including concerns over the date of the 2020 pension scheme valuation, as it argues that the valuation of the pension amid a stock market crash, and its methodology, was a “breach of duty” and “at least a misuse of directors’ powers”.

The claimants have also argued that the proposed cuts to the USS amount to discrimination, as they hit women, ethnic minorities and young people the most.

In addition to this, they alleged that the directors of USS have driven a super-inflation in asset manager and total operating costs in a way that “serves themselves, not the company”, arguing that the scheme should cut costs rather than pension benefits.

Climate worries have also been flagged, as the claimants argued that failing to divest fossil fuels has caused, and will continue to cause “significant financial detriment”, and is against the interests of the beneficiaries.

The claims, which were brought about by Bristol UCU, Dr Neil Davies, and KCL UCU, Dr Ewan McGaughey, will now be reviewed by the High Court to decide whether to grant the applicants permission to proceed to a trial.

Commenting in an update for the case's CrowdJustice page, representatives stated: “On Friday, 29 October, we issued proceedings in the High Court, and served notice at the offices of the USS directors.

“Just as we've promised, and with a total failure to adopt any meaningful change from the USS shadow director or CEO, Bill Galvin, and the board of directors of USS Ltd as whole, we've launched a derivative claim against them.

“This is the first time they have ever faced the prospect of personal accountability for the damage they have caused, and we are going to use the law to its fullest extent.”

A USS spokesperson stated: “It would not be appropriate for us to comment on legal proceedings.”

The issuance of proceedings was announced amid the news that University and College Union (UCU) has also called on USS to pause the 2020 valuation process until a resolution can be agreed or there has been an application to the High Court to review the USS’s decisions, in light of concerns that USS may have breached scheme rules in the valuation process.

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