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Further talks agreed in universities pensions dispute

27 February 2018

UCU said it was pleased that Universities UK (UUK) had agreed to further talks to try and end the disruptive strike action currently affecting 61 universities

Both sides have agreed to go for further talks mediated by the conciliation service Acas, which will begin on Monday (5 March). The strike action remains on. Staff will be on strike on Wednesday (28 February) and then back out for four days on Monday (5 March). This initial wave of 14 days of strikes will then conclude with a five-day walkout from Monday 12 - Friday 16 March.

In the talks, UCU tabled a set of proposals* it said it believed could resolve the dispute. The union said its proposals were drawn from both its members' demands and ideas put forward by many university vice-chancellors^.

UCU said its plans would provide a guaranteed pension for members of the Universities Superannuation Scheme (USS) at approximately half the extra cost attributed to the union's previous proposal.

The new proposal would mean:

  • Universities accept a small amount of increased risk through a return to the risk level USS proposed in September 2017 - something the majority of institutions were happy with
  • The limit on salary counting for defined benefits remaining unchanged at £55,550
  • Annual accrual rate reduced from 1/75th to 1/80th
  • Contributions would increase by just 4.1% (split 65/35 between employers and employees) rather than the 8.3% estimated cost of UCU's previous proposal - an increase in contributions of 2.7% for employers and 1.4% for USS members

Responding to a UUK consultation, 58% of institutions said they were prepared to accept the current levels of risk or to increase the risk. It has since come to light that the 42% proportion of institutions wanting less risk (the position UUK adopted) may have been distorted upwards by giving Oxbridge colleges the same weight as universities.

In addition, UCU said it wanted to work with the employers on a number of issues to put USS on a strong footing and avoid disputes like this in the future. UCU has called for:

  • a review of the competitiveness of USS benefits, compared to those of school teachers and academics in the Teachers' Pension Scheme
  • a study of alternative ways of providing pension benefits, such as collective defined contribution (CDC)
  • a joint approach to government and other political partners with a view to them underwriting the USS scheme
  • a review of valuation methods.

UCU general secretary Sally Hunt said: 'We are pleased the employers have agreed to more talks. Today UCU tabled proposals which provide the basis for settling this damaging dispute. We have listened not just to our members, but also to the many university leaders who have contributed ideas.

'At the core of our proposals is for universities to accept a small amount of increased risk, but only at a level a majority have recently said they are comfortable with. Doing this would enable us to provide a decent, guaranteed pension at a more modest cost with smaller contribution increases. 

'UCU has been impressed by the ideas of many vice-chancellors who have intervened in the dispute. Our proposals for long-term reform reflect an attempt to reach a consensus around the challenges we face.'


* UCU proposals to resolve the dispute

  1. UCU welcomes the calls from politicians and many vice-chancellors for urgent negotiations without preconditions. For our part we are committed to resolving the dispute and welcome the opportunity to negotiate. We believe that negotiations should continue until we reach agreement.
  2. UCU proposes a wide-ranging agreement which addresses the short-term concerns of our members about the current pension cuts and long-term issues with regard to the future of the fund.
  3. UCU's policy is to retain a decent defined benefit pension for members. We have already tabled proposals with a £55,550 threshold, which employers have rejected. We reiterate our invitation to UUK to join us and explore thresholds and accrual rates which retain a decent guaranteed pension benefit.
  4. Both sides recognise that this joint work may potentially mean proposals for a modest increase in contributions.
  5. In line with the developing views of many institutions, and the invitation to explore a joint resolution, we propose that UUK and UCU immediately agree to review and adjust the current risk parameters with a view to striking the correct balance between affordability and prudence. Both UUK and UCU then make a joint recommendation to the USS Board that the current parameters be adjusted to facilitate a settlement of the dispute.
  6. UCU proposes that both sides commission an independent inquiry into alternative ways of providing guaranteed pension benefits, including collective defined contribution (CDC).
  7. UCU proposes both sides commission an inquiry into alterative valuation methodology.
  8. UCU proposes that both sides seek discussions with government and other political partners with a view to building consensus for government to underwrite the USS pension scheme.
  9. UCU proposes that both sides commission an independent review of the recruitment and retention issues that arise from the lower pension benefits available to USS members compared to those of school teachers and academic staff in the Teachers' Pension Scheme (TPS).
  10. UCU proposes that both sides commission a review with a view to avoiding damaging disputes in the future.


^ Some vice-chancellors' views and suggestions for resolving the USS dispute:

'The University of Aberdeen remains committed to providing strong and sustainable pensions for its staff and, while recognising the challenges that USS faces at the current time, we believe that meaningful negotiations ought to be able to develop a solution that is mutually acceptable in terms of the three challenges of benefits, affordability and risk. As risk is likely to be a key part of any solution we suggest that it might be helpful to include the Pensions Regulator in the discussions.

'We remain convinced that there is no need for USS to move away from having a significant defined benefit element. However, we recognise that there are challenges related to affordability and risk, and that all parties to the negotiations need to engage constructively in order to meet them.'

Professor Sir Ian Diamond, vice-chancellor of the University of Aberdeen


'We believe high-quality pension arrangements are a significant part of the benefits available to our employees. We feel the USS trustees are being overly prudent in their assumptions, which will potentially undervalue assets and overestimate potential liabilities. At Essex, we are prepared to consider increasing employer contributions to the scheme, alongside increases in employee contributions, to sustain critical features of the USS, including defined benefits.'

Anthony Forster, vice-chancellor of the University of Essex


'We need new ideas that allow the defined benefit (DB) scheme to continue in practice as well as in theory.

'I would like to see both sides commit to discussions about the future of the pensions scheme beyond this dispute particularly around risk sharing. For the longer term, the joint UUK-UCU agenda could include learning from the Royal Mail pensions process, which promises a novel approach with a collective defined contribution scheme, something that could be valuable to for that element of USS that is currently in DC mode; separately, it could also include employers committing to longer term guaranteed levels of contribution.

'I would like to see both sides approach the government about the possibility that USS becomes government backed.'

Stuart Croft, vice-chancellor of the University of Warwick


'We are an institution that prides itself on evidence-based analysis, and we are now calling upon UUK and USS to jointly convene an expert group, including both their advisers and leading academic experts, to provide full transparency on the assumptions, data and modelling approach that has been used.

'We recognise that we have such experts at Imperial, and we will fully resource any staff who participate in this process.  We understand that this work will take time and may go beyond the statutory deadline for changes to be introduced.  If asked, we will agree to carry our share of the risk of staying on the current scheme while this work is completed.

'There are a number of parties involved.  The Pensions Regulator defines a framework that the USS Trustee must work within.  The USS Trustee must act in the best interests of all USS members and enact a plan to create a sustainable pension scheme.  UUK has to represent 350 institutions and collectively agree an affordable plan. Given this, and the nature of the changes being proposed, we believe that complete transparency is essential.'

Professor Alice P. Gast, president Imperial College London and Professor James Stirling, provost Imperial College London in an email to all staff this afternoon (Tuesday 27 February)


 'In summary, I urge UUK to maintain meaningful negotiations at the JNC, to aspire to the maintenance of a defined benefit scheme and to revisit valuation assumptions and/or the deficit recovery period proposal rather than looking solely to contribution increases as an alternative solution.

'I consider it essential that negotiations continue for as long as may be necessary to achieve an agreement, even that means continuing discussions into March which could still ensure the USS trustee meets regulatory timelines.'

Robert J Allison, vice-chancellor of Loughborough University


'I am now stating publicly that both sides should return to the negotiating table and conduct meaningful negotiations with the preferred outcome being the retention of a defined benefit scheme in an affordable form.'

Professor David Latchman, master of Birkbeck College


'As regards the dispute, I am of the view that a further independent valuation of the Scheme's assets is now required and I continue to advocate for further discussions between UCU and UUK.'

Stuart Corbridge, vice-chancellor of Durham University


'Any settlement needs to be affordable to both employers and staff; it should be a long-term solution, to avoid the risk of further possible conflict at the time of the next USS valuation; and it needs to be framed in a way that is acceptable to the Pensions Regulator. 

'The University of Glasgow stands by the position it took in the original consultation exercise, when it:

  • Recognised the importance of securing the long-term future of the scheme for the good of both current and future members.
  • Recognised that amendments to the scheme were likely to be necessary but expressed a preference for retaining a defined benefit element if possible.
  • Indicated a willingness to increase employer contributions as part of an overall negotiated solution.'

Professor Sir Anton Muscatelli, principal of the University of Glasgow

'We remain committed to providing a strong and sustainable pension for staff and believe that negotiations must focus on developing a solution that is mutually acceptable in regards to benefits, affordability and risk.'

Professor Sir Keith Burnett, vice-chancellor of the University of Sheffield

Last updated: 25 March 2020