Open letter from the Brunel UCU Committee regarding the USS Pension Scheme

4th May 2021

Dear Vice-Chancellor,

This letter is a follow-up to the request that Stan Gaines, Branch Chair, made (on behalf of the Brunel UCU Branch Committee) to Gemma Bailey in September 2020 regarding the formation of a working group at Brunel (to include senior management and UCU reps) concerning a potential joint position on the USS scheme. We did not receive a positive response. With no working group in place, and with only a few weeks left in terms of UUK consultation, we write to you directly (given your role as Vice Chancellor and President of Brunel), in order to seek answers to key questions about your plans for Brunel’s response.

We are aware that on 7th April, UUK launched a consultation of employers which closes on 24th May. UUK is asking employers whether they support proposals for benefit cuts, as a response to the extremely high contribution rates and other demands which USS is making in its 2020 valuation. We understand that both employers (UUK) and UCU agree that the 2020 valuation methodology that USS is using, is flawed, and UCU is urging UUK to join the union in robustly resisting the USS approach.

The UUK response so far, unfortunately, has been to largely ‘recycle’ the first proposal that was presented via the ACAS talks when UCU members took strike action in 2018/2019, a proposal which UCU branches decisively rejected: [https://www.ucu.org.uk/media/9300/Agreement/pdf/UCU_UUK_agreement_at_ACAS_12_March_Final.pdf]. We are aware that UUK is proposing to:

-lower the salary threshold where defined benefit (DB) accrual stops from £59,883.65 to £40,000
-reduce accrual (and therefore the size of payments in retirement) from 1/75 to 1/85
-impose a CPI indexation cap of 2.5% (removing the protection of benefits against any inflation above that level)
-keep the contribution rate as it is now (9.6% for members, 21.1% for employers).

We also note with concern that UUK is consulting individual employers on options for addressing the high rates of staff opting out of the scheme. We understand that UUK’s preference seems to be a defined contribution (DC) only option which would be aimed at low paid members of staff, provide no guaranteed retirement income, and almost certainly amount to a very poor pension compared with the defined benefit scheme (DB) which USS members have now.

Consequently, we are asking as part of the current consultation:

-Will Brunel commit to sharing its consultation response?

-In terms of addressing opt out rates, does Brunel endorse the DC option preferred by UUK or an alternative?

-Is Brunel willing to pay higher contributions than the current rate?

-Does Brunel endorse the benefits cuts proposed by UUK or not?

-Does Brunel want UUK to explore conditional indexation with UCU?

-Is Brunel willing to provide more covenant support, particularly in the form of a 30 year moratorium on employer exits?

-Would Brunel be willing to consider legal action against USS/TPR and/or express no confidence in USS?

We note that, although you have utilised a series of weekly Campus Communications e-mails to publicise your criticism (in your role as President of UUK) toward the UK government for deciding that students could not return to university campuses prior to 17th May, you have not used that same platform at Brunel to criticise USS for its highly flawed 2020 valuation and the subsequent proposal to shift from a Defined Benefits to a Defined Contributions scheme for lower wage earners. Hence, we seek explicit assurance that Brunel senior management will stand in solidarity with the Brunel UCU Branch regarding defence of the current Defined Benefits scheme. This is all the more important as Brunel’s USS related information-dispensing exercises (combined with rejection of our trade union branch efforts toward developing a working group with senior management concerning the USS pension scheme) do not represent genuine consultation, let alone negotiation, under the terms and conditions of our Recognition Agreement.

If you could respond to the letter within the next week (Monday 10th May), we would be most grateful. We shall be circulating any response to our members.

Sincerely,

Brunel UCU Branch Committee