The ‘cost-sharing’ rule
On Friday 27 April the Joint Negotiating Committee (JNC) revoked the benefit proposals it recommended in January this year. In the absence of any new proposals from the JNC, the USS trustee has said that to fulfil its statutory obligations the ‘cost-sharing’ rule will take effect in parallel to the work of the JEP.
The proposed changes would see
- The 1% employer match discontinued
- Employers’ contributions to the USS Investment Builder on salary above the threshold to remain at 12%
- An increase in contributions from both employers and members on a 65:35 cost-sharing basis.
This increase would be on a phased basis, beginning in April 2019:
|From 1 April 2019||From 1 October 2019||From 1 April 2020|
|Source: USS members update|
These proposals are subject to a 60-day consultation with members which will start in September.
We are firmly requesting that the USS give the JEP report due consideration before any substantive changes are made to contributions. Any new benefit agreement arising from the JEP which might subsequently be recommended by the JNC could still be implemented.
We will continue to support the work of the JEP and hope that its report and the subsequent Joint Negotiating Committee discussions in the autumn lead to a sustainable, equitable and fair pension scheme. A prolonged period of higher contributions would require difficult choices over future priorities for pay and remuneration and would affect the affordability of the scheme for many of you.