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August 24th, 2018:

Something for the holidays – brief update on the USS Pension ‘holiday’

In the late 1990s the University of Southampton like other employers reduced its USS pension contributions to 14%. Tom Pike, Vice President of Imperial’s UCU wrote an open letter earlier this year saying “with the benefit of hindsight can be seen as the source of the current technical deficit — if employers had maintained an 18.55% contribution there would be another £7 bn in the fund, based on the known subsequent net levels of USS investment return.” Universities UK have argued that the ‘special rate’ of 18.55% met the cost of the future benefits then accruing, and met the shortfall in funding terms relating to the USS’s predecessor scheme, known as FSSU. Universities UK claim that linking the reduction in contributions to the current (disputed) deficit is misinformed.