An update on pensions and the pay and benefits review - 28 March 2018
We are acutely aware of the strength of feeling on the ongoing pensions dispute and the impact it is having on our community. We are listening to your concerns and your views have played an important role in shaping the College’s response to the situation to date.
As you probably will have already heard, on Friday of last week UUK and UCU announced a new proposal agreed under the auspices of ACAS that would put benefit reform discussions on hold while a Joint Expert Panel examines the current valuation and agrees key principles to underpin a future joint approach. The existing scheme would be maintained as a result until April 2019. Full details of the new proposal are included at the end of this message.
This new proposal responds specifically to the concerns about the data and analysis behind the current valuation which we raised in February when we called for UUK and UCU to convene an expert group. We welcome this new proposal as an important step towards greater transparency and we hope that experts from the College will be represented on the group. As we have said previously we will fully resource any of our staff who participate in this process. UCU and UUK are now consulting with their members and approaching USS and the Pensions Regulator to support this new proposal, given their statutory obligations to consult on and agree a scheme before the end of June 2018.
While the national organisations try to find a solution to the current dispute, we are focused on our . Today we are publishing an information pack with details on our funding streams, our expenditure and our capital investment. Together with the staff data pack you have already received, we hope this will help inform your feedback on the future balance of our investments. Our review runs until Friday 13 April and we look forward to your contributions.
Alice and James
Professor Alice P. Gast, President, Imperial College London
Professor James Stirling, Provost, Imperial College London
ACAS proposal announced 23 March 2018
UCU and UUK are now taking this proposal to consultation with their respective parties.
- A formally agreed Joint Expert Panel, comprised of actuarial and academic experts nominated in equal numbers from both sides will be commissioned, to deliver a report. Its task will be to agree key principles to underpin the future joint approach of UUK and UCU to the valuation of the USS fund.
- It will require maintenance of the status quo in respect of both contributions into USS and current pension benefits, until at least April 2019.
- There will be a jointly agreed chair whose first step will be to oversee the agreement of the terms of reference, the order of work and timescales with the parties. Any recommendations by the group must be based on a majority view of the panel without the use of a casting vote. A secretariat, jointly agreed by the parties, will be appointed.
- The panel will focus in particular on reviewing the basis of the scheme valuation, assumptions and associated tests. It will take into account the unique nature of the HE sector, inter-generational fairness and equality considerations, the need to strike a fair balance between ensuring stability and risk. Recognising that staff highly value Defined Benefit provision, the work of the group will reflect the clear wish of staff to have a guaranteed pension comparable with current provision whilst meeting the affordability challenges for all parties, within the current regulatory framework
- The panel will make an assessment of the valuation. If in the light of that contributions or benefits need to be adjusted in either direction, both parties are committed to agree to recommend to the JNC and the trustee, measures aimed at stabilising the fund to provide a guaranteed pension broadly comparable with current arrangements
- Alongside the work of the panel both sides agree to continue discussion on the following areas: comparability between TPS and USS; alternative scheme design options; the role of government in relation to USS; and the reform of negotiating processes to allow for more constructive dialogue as early as possible in the valuation process.
- Support for this process will need to be sought from the USS trustees and the pensions regulator, recognising their statutory responsibilities. Both UCU and UUK will make the necessary approaches to seek this support.
- Should this process prove acceptable to all parties this could provide the basis for the UCU to consult its branches and members on ending the industrial action currently underway within the sector.