A mandate ‘to retain a decent, guaranteed pension’

An important statement of UCU’s negotiating position

University and College Union General Secretary Sally Hunt has issued the following significant statement of the union’s negotiating position:

Some of you have asked what UCU’s negotiation position is in these talks.

Our position is straightforward — we have a mandate from you to retain a decent, guaranteed pension.

I have also received clarification of the status of the Manchester resolution — “To refuse to accept detrimental changes to the USS pension scheme” — which I have previously discussed here and here. The clarification is that this resolution is advisory and non-binding. It is not an official statement of UCU policy.

A mandate “to retain a decent, guaranteed pension” is clearly more open-ended and accommodating than a resolution to “refuse to accept detrimental changes”. It signals significant scope for negotiation with the employer (UUK), beyond the very modest downward departure from the defined benefit (DB) status quo that UCU tabled at JNC on the 23rd of January. (See point 4.)

My understanding is that Sally Hunt’s statement was issued in the context of ongoing discussion between UCU and UUK that is premised on the belief that USS and the chair of JNC might be persuaded to accept an overturning of the 23 January JNC decision, so long as both sides can agree to something different. But such agreement would need to happen soon, given the pressures of the 30 June statutory deadline that USS keenly feels. A salient date which might just qualify as ‘soon’ is the 21st of February, the day before strikes are scheduled to begin.

Sally Hunt reports that the employer has refused to engage with efforts on the part of UCU to negotiate a decent level of DB accrual for this valuation:

UCU has repeatedly pressed the employers to say what combination of accrual rate, contribution rate and salary cap they would be prepared to go with in order to preserve the guaranteed pension. At least if we could agree on the desirability of a guaranteed pension, we could then work together towards a fair outcome for staff.

However, so far the answer has been that the employers do not want to preserve the guaranteed pension at all.

It is an amazing and disappointing stance and it is the reason why we now find ourselves on the brink of sustained strike action.

The onus is now clearly on the employer to signal a willingness to negotiate a settlement involving DB accrual somewhere between the zero level they have proposed and the status quo of 1/75 accrual at £55k.

As UCU pensions representatives were informed in a meeting on 12 January, the independent JNC chair Andrew Cubie had asked USS to develop proposals for JNC to consider, involving a decent DB salary threshold roughly midway between £0 and £55k (c. £30k-£35k). I believe that the majority of employers and USS members would welcome a resolution of this dispute in which the two sides get together in a room and reach a settlement within that range.

Sally Hunt correctly notes that “achieving this would be a lot easier if the employers were prepared to take on a small amount of extra actuarial risk”. The 42% minority of employers who are making a settlement so difficult could, for example, agree to bring themselves in line with the 58% of employers who accepted at least the level of actuarial risk that USS proposed in September.

I hope members of the press obtain urgent clarification from UUK regarding their willingness to negotiate a settlement, in order to call off strikes, that involves a level of DB accrual in which the two side meet each other halfway. Or are they instead intransigently committed to an absolute zero level of DB accrual?

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Professor, Dept. of Philosophy, Logic & Scientific Method, LSE

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