USS: 0% contribution increases needed to service deficit!

I have just sent the following letter to Martin Atkinson and Jane Higham in the hope that we can push back against the continuing farce that is the #USSmess.


Dear Jane and Martin,

I would be grateful if we could add to the next USS sub-JSNCC meeting agenda the letter that Jo Grady sent to Alistair Jarvis today regarding the last JNC meeting. It regards the USS Trustees having recently confirmed that there need be 0% contribution increases in order to service the deficit and I think it would be helpful to discuss the Kent’s position. Please also see this Professional Pensions article.

Universities around the UK are paying £millions into the USS as deficit recovery payments that need not be paid and that could, instead, be used to fund the pension pots. As announced in its accounts, Kent is paying £7,591,597 each year in deficit recovery payments that are not going into our pensions (as a result of the UUK changes to be implemented on 1st April).

You may have already seen that the Universities of Cambridge and Oxford and Imperial College London have already signed a joint document declaring their concern with the USS Trustees investment strategy and Michael Otsuka’s explanation of the current state of affairs, and Sam Marsh’s. To summarise their positions, this seems like convincing evidence that the USS Trustees can be counted on to undervalue the ratio of assets to liabilities in the service of an ever-more-prudent valuation.

Although it will be too late by the time of our meeting to call for the halt to increases in the contribution rates, and even in the absence of any JNC decision between now and 1 April, which the trustee confirms as implementable, to stop the UUK cuts from taking effect, the trustee could issue a new deficit recovery plan which reduces DRCs to zero in light of post-valuation experience. This could then form the basis of a new schedule of contributions with an overall contribution rate of 25.6% to fund UUK’s cuts. I suggest that this might form the basis of a joint statement between Kent UCU and the University and that we discuss the possibility at the meeting.

Best wishes,