New offer sent to UCU members in USS pensions dispute

Following further negotiations this week, the Universities UK (UUK) board met this afternoon and agreed a proposal aimed at resolving the pension dispute. That proposal has been sent to University and College Union (UCU) members, along with a message from UCU general secretary Sally Hunt.

UCU branch representatives will meet at 11am on Wednesday 28 March to discuss members' feedback. The union's Higher Education Committee will meet after that meeting to set out the next steps.

The full proposal and letter from Sally Hunt are below. The proposal will see the creation of a jointly agreed expert panel to agree key principles to underpin the future joint approach of UUK and UCU to the valuation of the USS fund. To allow this to happen, the current deal in terms of contributions into USS and pension benefits will remain in place until at least April 2019.

Sally Hunt letter to members:

Dear colleague

I wrote to you on Monday following Universities UK's announcement that it intended to set up an expert panel to review the USS deficit. 

I said then:

"Of course we welcome any acceptance by UUK that the valuation should be looked at again. However for any such process to have the confidence of the sector, the panel and its terms of reference must be jointly agreed between UCU and UUK rather than imposed by one side on the other.  Equally importantly, if UUK now proposes to do this work the current round of cuts to pension benefits which are the immediate cause of this dispute must be removed so that a properly constituted panel can do its work."

This week I have continued to press UUK on both of these objectives in talks supported by ACAS.

Arising from this, UUK has agreed a proposal to be put to UCU members which I have set out below this message.  In essence what has been proposed is as follows:

• A Joint Expert Panel, comprised of actuarial and academic experts nominated in equal numbers from both sides will be commissioned to deliver a report. Its task will be to agree key principles to underpin the future joint approach of UUK and UCU to the valuation of the USS fund.  This will require the status quo both in terms of contributions into USS and current pension benefits, until at least April 2019.
• A jointly agreed chair whose first step will be to oversee the agreement of the terms of reference, the order of work and timescales with the parties. Any recommendations by the group must be based on a majority view of the panel without the use of a casting vote.  A secretariat, jointly agreed by the parties, will be appointed.
• The panel will focus in particular on reviewing the basis of the scheme valuation, assumptions and associated tests. It will take into account the unique nature of the HE sector, inter-generational fairness and equality considerations, the need to strike a fair balance between ensuring stability and risk.
• Recognising that staff highly value Defined Benefit provision, the work of the group will reflect the clear wish of staff to have a guaranteed pension comparable with current provision whilst meeting the affordability challenges for all parties, within the current regulatory framework.
• The panel will make an assessment of the valuation. If in the light of that contributions or benefits need to be adjusted in either direction, both parties are committed to agree to recommend to the JNC and the trustee, measures aimed at stabilising the fund to provide a guaranteed pension broadly comparable with current arrangements.
• Alongside the work of the panel both sides agree to continue discussion on the following areas: comparability between TPS and USS; alternative scheme design options; the role of government in relation to USS; and the reform of negotiating processes to allow for more constructive dialogue as early as possible in the valuation process.

I have spoken today to UCU's Superannuation Working Group who are agreed that this statement should go to members and that - in line with our previous practice - USS branches should be recalled to a briefing on Wednesday, 28 March to provide initial feedback on your response. 

It will then be for the Higher Education Committee to decide on the further process for consulting members via a ballot.

We have worked hard to gain these concessions, but they were won on the back of the strike action that so many of you have taken.

As always it will be for members to decide whether what has been achieved is sufficient to suspend our strike action.

Sally

Text of UUK proposal

1. A formally agreed Joint Expert Panel, comprised of actuarial and academic experts nominated in equal numbers from both sides will be commissioned, to deliver a report. Its task will be to agree key principles to underpin the future joint approach of UUK and UCU to the valuation of the USS fund.
2. It will require maintenance of the status quo in respect of both contributions into USS and current pension benefits, until at least April 2019.
3. There will be a jointly agreed chair whose first step will be to oversee the agreement of the terms of reference, the order of work and timescales with the parties. Any recommendations by the group must be based on a majority view of the panel without the use of a casting vote.  A secretariat, jointly agreed by the parties, will be appointed. 
4. The panel will focus in particular on reviewing the basis of the scheme valuation, assumptions and associated tests. It will take into account the unique nature of the HE sector, inter-generational fairness and equality considerations, the need to strike a fair balance between ensuring stability and risk. Recognising that staff highly value Defined Benefit provision, the work of the group will reflect the clear wish of staff to have a guaranteed pension comparable with current provision whilst meeting the affordability challenges for all parties, within the current regulatory framework.
5. The panel will make an assessment of the valuation. If in the light of that contributions or benefits need to be adjusted in either direction, both parties are committed to agree to recommend to the JNC and the trustee, measures aimed at stabilising the fund to provide a guaranteed pension broadly comparable with current arrangements.
6. Alongside the work of the panel both sides agree to continue discussion on the following areas: comparability between TPS and USS; alternative scheme design options; the role of government in relation to USS; and the reform of negotiating processes to allow for more constructive dialogue as early as possible in the valuation process.
7. Support for this process will need to be sought from the USS trustees and the pensions regulator, recognising their statutory responsibilities. Both UCU and UUK will make the necessary approaches to seek this support.
8. Should this process prove acceptable to all parties this could provide the basis for the UCU to consult its branches and members on ending the industrial action currently underway within the sector.