Members of the £60 billion ($78.3 billion)
Universities Superannuation Scheme are petitioning trustees to disclose funding
calculations theyve shared with their employers behind
The pension plan members are concerned that they may have to
contribute more to the fund, which has a £17.5 billion
deficit, or see their benefits cut when the results of
USSs triennial valuation are published next month. The
petition, which began circulating Wednesday, has already
attracted signatures from more than 400 members.
Britains parliament last month pressed USS, the
countrys largest private-sector pension fund, for details
on how it will shore up its deficit, which may vary in size by
billions of pounds depending on the method of calculation and
the outlook for returns. At the start of September, the USS
sent a report to universities participating in the pension plan
that included projections for its investments and
USS has to do its valuation imminently and the
frustration for us, is that a lot of what goes in behind the
scenes to produce the numbers, is hard to get hold of,
said Sam Marsh, a scheme member at the University of Sheffield.
The key thing that I would like to know is what would the
valuation look like if they removed their test one
While the £17.5 billion shortfall is accurate as
measured under financial reporting standards in the U.K., the
size of the deficit drops £4.9 billion when calculated
under technical provisions set under rules governed
by Britains Pensions Regulator. Members of the retirement
plan are particularly concerned about the test one
measure used by USS because they believe it gives university
finance directors an excessively negative picture of future
risks, costs and investment returns.
[II Deep Dive: Parliament Probes USS Pension Plan]
Theyre fearful that USSs October valuation will
mean further cuts to the defined benefit element of the scheme.
At the last valuation, members were told that they would accrue
DB benefits up to the first £55,000 that they earn, but
there is growing concern the amount will be cut significantly
and replaced by a greater defined contribution element.
USS is now consulting with Universities UK on its
proposed assumptions for the technical provisions, said a
spokeswoman for USS. Directly making the full document
available to all members risks confusing with whom USS is
consulting on this occasion.
Universities UK, a group representing British universities,
is reviewing the report sent by USS at the beginning of this
month. USS says it has shared the private document with the
more than 350 employers participating in the scheme.
The spokeswoman for the pension fund said the USS has
provided a summary of the report on its website and will provide more detail once
the first stage of the consultation with universities has been
Michael Rutter, president of the Cambridge University UCU,
said the pension funds full calculations and methodology
should be made transparent to its scheme members. He added that
he believes the USS is seeking to replace the DB scheme with a
I need a pension that is guaranteed, Rutter
said. When they talk about de-risking, they are largely
moving the risk from them to me and my colleagues, and that
doesnt seem reasonable.