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Communications Briefing on USS: UCU's ballot for industrial action

29 September 2014

This communications briefing has been prepared by Universities UK (UUK) and the Universities and Colleges Employers Association (UCEA) to support HE institutions in communicating with their staff as the University and College Union (UCU) ballots its members about industrial action relating to potential changes to the USS.

UUK, on behalf of the USS employers, is seeking to ensure that USS remains a sustainable, attractive and affordable pension scheme for all members, both current and future. Future benefit changes are inevitable, but any changes proposed will be designed both to address the substantial deficit in the scheme and mitigate the risk that contribution rates will become unaffordable for both employers and employees. With significant complexity surrounding the process for change in USS, the content of sector communications needs to be factual, clear and concise. 

UUK, as the formal employers’ representative under the scheme rules, has maintained a continuing dialogue with UCU and the USS Trustees concerning the financial position of the USS and how this can be managed. These discussions will continue over the coming months and a programme of formal meetings between the employers, UCU and the USS Trustees to discuss the issues is in place. We are also considering the results of the recent employer consultation and a meeting of the USS Group of the Employers Pensions Forum is being held to review the employers’ approach and decide on the options for proposals. This means that the details of the proposed benefit changes that UUK will formally submit to the USS Joint Negotiating Committee (JNC) in November 2014 have not yet been finalised, although the need for further change is clear. A revised funding and benefit plan must be put in place in order to deal with a large deficit (expected to be around £8bn as at March 2014) and address the volatility in the USS funding level.

UCU balloting members for industrial action

Even at this early stage UCU is seeking to oppose the broad employer approach for future changes, despite the fact that the details of proposed changes remain undecided and discussions between the union and employers continue. Employers at 67 pre-92 HE institutions where USS is the principal pension scheme for academic and related staff have been given notice that UCU is balloting its members for industrial action (both strike action and action short of a strike) in relation to possible changes to the benefit structure of USS. Specifically, the trade dispute on which the ballot is based is the request made to the 67 individual HEIs in July 2014 for employers to change the terms and conditions of employment to guarantee existing USS pension provision for their employees.

Issuing a ballot can only be regarded as premature at this stage when UUK proposals for potential benefit changes are still being developed following the recent consultation with participating employers (which closed on 22 September). This means that UCU is seeking support for industrial action over changes that have yet to be finalised or fully discussed with the JNC.

UCU is a key stakeholder in the USS, representing all scheme members on the JNC, and it is at the forthcoming meetings of this committee in October and November that it can raise objections to the employers’ position. In fact there is a sub-committee of the JNC, comprising both UCU and UUK representatives, which has been reviewing the financial position during the last year and has more recently been looking together at modelling work on the proposed changes which has been prepared by USS. UCU have chosen to disregard this joint work and have produced their own estimates based on different assumptions. These UCU estimates include some plain factual errors (such as a claim that “benefits will not apply” above a salary threshold, when the employers’ approach includes the provision of a new Defined Contribution section).

Before the final implementation of any changes, the views of individual scheme members (as affected employees) will be taken into account during the statutory consultation which will take place once the JNC has finalised the package of scheme changes. This is expected to take place early in 2015. UCU’s premature action is clearly intended to seek a mandate from its members for industrial action to put pressure on the UUK negotiators before a JNC decision is taken. The UCU ballot will open on Wednesday 1 October and run to Monday 20 October.

The UCU’s ‘Defend USS’ campaign has begun, with material posted on their website at, including this leaflet which inadequately explains UCU’s modelling based on ‘proposals’ that employers have not yet even made:

Timeline of key forthcoming dates

Remainder of 2014 
Alongside a continuing programme of informal discussion meetings between employer representatives and UCU, there are a number of key meetings, including:

7 October
Employers’ representatives in the Employers Pensions Forum (EPF) USS Group meet to discuss the responses received from scheme employers following the recent UUK employer consultation, and decide on the proposals for future scheme design and contributions which will then be taken forward to negotiation with UCU.

22 October
USS JNC meeting where member representatives (UCU) will meet employer representatives (UUK) to consider initial proposals from the employers – and if UCU wishes, from UCU – for future benefit reform.

13 November
Further USS JNC meeting aiming to conclude discussions between the parties on potential benefit reforms and decide on the proposed changes that will be the subject of the statutory consultation by employers with affected employees.

Early 2015
The USS Trustee Board considers the JNC decision and asks scheme employers to commence the statutory employee consultation with affected employees on proposed USS benefit reforms which will last for at least 60 days. All active members of USS as well as employees who have opted out of USS or other USS eligible non-members should by law be included in the consultation as well as certain representative bodies. This consultation must be undertaken by each scheme employer with their own employees. The JNC and USS Trustees will then receive feedback from the consultation before making final decisions by June 2015.

EPF comment over UCU plans for industrial action ballot:

An Employers Pensions Forum (EPF) spokesperson said:

“Reform is necessary to address the sizeable and continuing deficit in USS. The employers’ objective is for the scheme to remain affordable, attractive and sustainable for both employees and employers, while addressing the deficit and reducing the risk of future contribution increases.”

“UCU’s ballot material includes misinformation about the employers’ proposals for reform that are not yet finalised. We are working with the USS Trustees and the UCU to consider what reforms are necessary and discussions concerning the financial position of the scheme and how this can be addressed are ongoing.”

Key messages relating to the USS

  • The USS has a sizeable and persistent yet volatile deficit. In March 2013, this deficit (the difference between the scheme’s assets and the value of the benefits for which it is liable) was £11.5 billion. In March 2014 the deficit is expected to be around £8billion. Reform of USS members’ future benefit structure is necessary to address the deficit and ensure that the USS remains viable.
  • The employers are working with the UCU and the USS Trustees to consider what approach is needed to address the deficit, including considering the necessary changes to the scheme’s future benefit structure. The employers’ objective is for the USS to remain affordable, attractive and sustainable for both employees and employers, while addressing the deficit and reducing the risk of future contribution increases.
  • The UCU modelling that is provided as supporting evidence for the ballot for industrial action is premature and ill-informed. By disregarding the modelling being considered jointly by UCU and UUK, UCU has provided misinformation to its members even though the employers’ proposals for reform have not yet been finalised and are the subject of continuing discussion between UUK and UCU.
  • UUK has just concluded consultations with USS employers on the possible options to address the deficit. The employers’ position will then be developed further in the coming weeks and USS will provide high quality modelling to enable understanding of any impact on future benefit accrual.
  • The benefits a member has built up before the date that any changes are implemented will be protected and will be calculated based on their service and pensionable salary at the date of change.
  • Institutions will receive a report on the outcome of the employer consultation following the EPF USS Group meeting and the employers’ proposals for reform will be publicly circulated once they are finalised later this autumn. UUK will also share modelling on the implications of the proposed reform for different categories of USS members in terms of their future benefit structure.
  • The employers’ proposals will be shared with UCU through the USS Joint Negotiating Committee (JNC) in October. The JNC consists of an equal number of employer and UCU representatives and an independent chair. We also expect the UCU to put forward their proposals for reform to the JNC.
  • Following the negotiations during the autumn and a decision by the JNC, a formal consultation with all affected employees and representative bodies on any proposed reforms to USS will take place in early 2015. Employees’ views must be taken into account by the JNC and USS Trustees before a decision to implement any changes is made.

Further information

UUK will be working with UCEA to supply employers with additional communications material throughout the development of the USS proposals and discussions for changes to the scheme. This process is expected to last until the summer of 2015.

Please note that communications materials such as FAQs on the funding deficit and the valuation process are available on the Employers Pensions Forum website.

FAQs on the valuation process are also available on the USS website at This site also hosts an update for members on scheme funding: