Today the Vice-Chancellor‚ Professor Don Nutbeam‚ made the following statement about the future of the Universities Superannuation Scheme (USS):
Most of you will be aware of the proposals to reform the Universities Superannuation Scheme. I am writing to update you on the current position following a number of recent developments.
The University contributed to the legally required consultation process on USS reforms late last year. In our submission we made clear that the University desires a sustainable long term scheme that gives members good retirement benefits and life assurance and debilitating injury/illness cover during employment, but with contribution rates that are affordable for both the employer and employee. Based on the information provided by the USS Trustees, I believe that the proposed reforms to USS are necessary to deliver these aims.
As required by the consultation, we submitted the views of the campus trade unions to the USS Trustees in December 2010.
Following the end of the consultation period, further moderate changes were made to the proposals, which I believe would generally be to the benefit of scheme members.
The University and Colleges Union (UCU) subsequently made clear that it does not consider the whole package of reform to be acceptable, and wanted a re-negotiation of the proposed changes. As you will be aware, the UCU took industrial action on this and other issues in March of this year.
In terms of the governance of USS, the UCU has a very important role. Under the rules of USS, the Joint Negotiating Committee (JNC) of the scheme is made up of four employer nominated members and four UCU nominated members (representing all employees in the scheme), and an independent Chair. In the past two months, the UCU nominated members of the JNC have absented themselves from meetings in protest against the package of reforms with the aim of initiating re-negotiation. As a result, the JNC has been inquorate and has been unable to function. Consequently, the package of reforms, that were due to be introduced from 1 April 2011, as well as other important business, could not be implemented.
I must make clear that I support the right of UCU to lobby to protect the interests of its members, and to take legitimate industrial action as it sees fit. I was impressed by the thoughtful and measured response by the University’s UCU members to the March industrial action.
However, I should make it equally clear that I consider it completely irresponsible to deliberately disrupt the workings of a pension scheme with assets of £30 billion and hundreds of thousands of active and pensioner members.
The JNC met again on 10 May 2011, and the meeting was quorate with the attendance of the UCU nominated members. At this meeting, the JNC was able to receive alternative proposals for reform presented by UCU. Following due process, and on the casting vote of the independent Chair, the JNC adopted the rule changes recommended by the USS Board in the light of the consultation process. There is a brief notice explaining this on the USS website (http://www.uss.co.uk/news/Pages/TrusteeBoardStatement1.aspx) and I am sure that further details will be posted on the USS site in the coming days.
I fully recognise that the provision of good pension benefits are extremely important to staff – I have recently received a petition from around 300 staff expressing their opposition to the changes in USS. However, there has been a general recognition in the private and public sector that the generous benefits offered by many schemes in the past could not be afforded in the future. In some other universities, the self-administered schemes (like our PASNAS scheme) have been stopped or benefits moved to career average or to a defined contribution basis. Under the current reforms USS will remain a very good scheme both in absolute and relative terms.
In correspondence with me the UCU has indicated that it may conduct a fresh ballot of members ‘to seek their agreement for a major programme of disruption…..including external examiner duties and those associated with the admissions process.’
I very much hope that this type of industrial action can be avoided. Given the nature of the reforms to USS compared with the changes in pension schemes elsewhere in the UK, I do not think that a ‘major programme of disruption’ deliberately targeted at preventing students from commencing or completing their studies would be understood by our students, their parents or society as a whole.