1/ Major UK media outlets, even those sympathetic to the #ucustrike, continue to reproduce the UUK’s premise of a ‘£6bn deficit’ in the USS pension scheme without question.
As someone who teaches critical thinking for a living, this irritates me. It also deceives the public.
As someone who teaches critical thinking for a living, this irritates me. It also deceives the public.
2/Let’s start with the basics. There is currently no deficit in the USS scheme. None. This has been verified by an independent actuarial analysis: ucu.org.uk/media/8705/Pro…
3/ The money coming into USS from contributions matches or exceeds what’s going out in pension payments. USS is in the black. Solid. Healthy.
4/But wait! You’re wondering if the USS is only healthy at the moment because senior staff are currently contributing vast sums. Surely these boomers will soon retire, reversing the balance of revenue and expense, no?
5/No. The average USS contributing salary is around £36-37K/yr, meaning that most USS participants are in the early stages of their careers.
They will, in the coming years, contribute increasing amounts to the scheme (as others join!) keeping it healthy.
They will, in the coming years, contribute increasing amounts to the scheme (as others join!) keeping it healthy.
6/As First Actuarial’s 2017 study of USS demonstrated, “Projected income and expenditure for 40 years [40 YEARS!!!] show that payments to pensioners are covered by contributions paid in without touching the assets.”
7/ So what’s going on? Where does this “deficit” come from?
Here are some answers: heconvention2.wordpress.com/2018/02/08/mad…
ucl.ac.uk/ucu/pdfs/ucl-u…
Here are some answers: heconvention2.wordpress.com/2018/02/08/mad…
ucl.ac.uk/ucu/pdfs/ucl-u…
8/Here’s what, to me, is the most jaw-dropping element of this three-card-Monte swindle UUK is trying to run:
The ‘deficit’ being validated in press coverage presumes *as its forecasting premise* the instantaneous failure and closure of all the USS-contributing universities.
The ‘deficit’ being validated in press coverage presumes *as its forecasting premise* the instantaneous failure and closure of all the USS-contributing universities.
9/ As a valuation standard for individual companies’ pension schemes, of course, this makes sense from a public responsibility standpoint. Think of Carillion or BHS. Individual companies do go bankrupt, and still have pension obligations to pay out.
10/ But what would it take for 68 UK universities—including Oxbridge!--to go bust simultaneously?
That’s right. Nuclear annihilation. Total collapse of the state. Alien invasion.
Is really what the Pensions Regulator is expecting?
That’s right. Nuclear annihilation. Total collapse of the state. Alien invasion.
Is really what the Pensions Regulator is expecting?
11/ If not, there is only one conclusion:
The idea of a USS pensions ‘deficit’ is contemptible tripe, and should never go unquestioned again, much less be used as the basis for a public discussion about higher education’s future in the UK.
The idea of a USS pensions ‘deficit’ is contemptible tripe, and should never go unquestioned again, much less be used as the basis for a public discussion about higher education’s future in the UK.
12/ UUK needs to return to negotiations, and this time, begin from a position that doesn’t presume the end of the world as the basis for valuing our pension scheme’s sustainability.
I think that’s called “negotiating in good faith.”
end.
I think that’s called “negotiating in good faith.”
end.
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