2020 valuation

 

Date
December 2019	The Joint Expert Panel publish their second report (JEP2), which makes recommendations on the valuation methodology.
December 2019	Imperial writes to the Pensions Regulator,  calling on them to take a flexible and thoughtful approach to JEP2. They responded  that they are ‘…engaging with the Joint Expert Panel (JEP) and will consider their recommendations carefully…’
January 2020	UUK consult with employers on recommendations from JEP2, to which Imperial provided a response
February 2020	UCEA and UUK publish a joint open letter, providing an update on progress to address concerns of university employees on pay, working conditions and pensions. You can find the letter here.
March 2020	USS issue valuation discussion document and consult on methodology and risk appetite.
September 2020	USS consult with employers on their proposed assumptions for the pension scheme’s Technical Provisions in relation to the 2020 valuation. In this document, USS set out their initial view on the assets, liabilities, long-term assumptions and the cost of the current benefits structure.
October 2020	Professor Ian Walmsley meets with USS representatives, along with our Director of Finance Tony Lawrence, and our internal experts Professors Richard Craster, Axel Gandy and David Miles. A number of questions were raised, including why the current consultation doesn’t encompass all aspects of the valuation process, the accommodation of only some of the JEP recommendations, and whether the asset modelling approach is appropriate in technique and time horizon. You can view a summary of the meeting and further details on the responses from USS.
December 2020	President Professor Alice Gast and Provost Professor Ian Walmsley write to USS endorsing the work of the Joint Expert Panel and urging full implementation of its proposals.
February 2021	Representatives from Imperial meet with UCU in order to discuss the USS valuation and agree upon an Imperial-UCU joint letter to USS urging the full implementation of the JEP's proposals.
March 2021	USS issue valuation report
March 2021	Imperial invites USS members to provide their feedback on the valuation and establishes regular staff drop-in sessions on pensions
April-May 2021	UUK launches its consultation on the valuation. You can view Imperial's response to the consultation [pdf].
April 2021	Representatives from Imperial meet with USS to discuss concerns with the valuation, its methodology and the debt monitoring framework. You can view a summary of the meeting.
May 2021	Imperial establishes a USS Valuation Working Group, chaired by Professor Richard Craster and comprised of staff representatives from across Imperial.
June-July 2021	UUK launches short consultation with USS employers. View Imperial's final response [pdf]‌
September 2021	The Joint Negotiating Committee made its recommendations, which were approved by the USS Trustee.  USS launched a short consultation with employers on the proposed recovery plan for responding to the deficit assessed by the USS Trustee as at 31 March 2020, and on a revised Schedule of Contributions effective from 1 October 2021. The USS Trustee is also consulting on the Statement of Funding Principles at the same time.
October 2021	Contributions will increase by no more than 0.2% for employees and 0.3% for employers.
January 2022	The USS consultation with members closed on Monday 17 January. Along with individual staff responses which were submitted directly to USS and to UUK, we also submitted a summary of Imperial staff views [pdf].‌
February 2022	Imperial submitted a response to the UUK consultation on the UCU proposal to conclude the 2020 USS valuation. View the response [pdf].
April 2022	The changes agreed as part of the 2020 valuation come into effect. Learn more on the USS website.

2018 valuation

• Following the conclusion of the 2017 valuation, USS consulted with UUK and employers on the 2018 valuation. This valuation included USS’s consideration of the report of the first Joint Expert Panel (JEP).
• The USS Trustees consulted on three options. Imperial, after consultation with Heads of Department and staff, stated a preference for Option 3. The majority of HEIs also opted for Option 3 and this was agreed by the USS Trustee and submitted to the Pensions Regulator.
• UUK then consulted with employers on protective measures to allow the Trustees to conclude that the covenant remains strong, which was a pre-condition to implementing Option 3. Following discussion at President’s Board, Imperial sent a response [pdf] that supported the package of protective measures subject to further details on implementation.
• The JNC agreed (by majority vote) on Option 3, that sets total contributions at 30.7% for the next two years and that the change in the rate should be shared 65:35 between employers and members respectively (21.1% for employers, 9.6% for employees from October 2019). You can read the responses from UUK and UCU who are the organisations represented on the JNC.
• This would avoid a significant, and for many unaffordable, increase to contributions set out in the USS default 2017 valuation position already agreed with the Pensions Regulator from April 2020, while allowing time for the Joint Expert Panel to complete their work and move quickly towards a new valuation in 2020, which is currently underway.
• The Pensions Regulator also needed to separately approve any new agreement reached between the parties. We have written directly [pdf] to the Pensions Regulator urging them to work with the other parties involved to come to a mutually agreeable valuation as soon as possible and avoid the default 2017 valuation contribution increases. Read the Pensions Regulator's reply [pdf].

 

 

 

 

 

The 2018 valuation resulted in a schedule of contributions set out below. This schedule remains in place until a further valuation is completed. 

 

The increase in contributions, outlined above, were part of the Trustee’s recovery plan submitted to The Pensions Regulator to address the scheme’s shortfall in funding of £3.6bn. 

• The USS Trustee commenced a consultation with UUK on the proposed Recovery Plan for responding to the deficit assessed by it as at 31 March 2018, and on a revised Schedule of Contributions to confirm the contributions coming into effect from 1 October 2019.  UUK have consulted with employers – you can view our response [pdf]. UUK has now formally responded to the USS Trustee.
• Separately, on 7 June we received a letter [pdf] from national UCU. Having discussed the draft with Heads of Department and received feedback and comments from the wider Imperial community we sent our response [pdf] back to UCU on 19 June. 
• There have been five meetings in January 2020 between UCU, UUK and USS to discuss and agree the approach for progressing the JEP’s recommendations. Read the statement from the fifth meeting.
• In December 2019, we wrote to the Pensions Regulator [pdf] calling on them to take a flexible and thoughtful approach to JEP2. They responded [pdf] that they are ‘…engaging with the Joint Expert Panel (JEP) and will consider their recommendations carefully…’.  Their continued support for these new talks and the outcome of the consultation process will be crucial to successfully concluding the 2020 valuation and securing the long-term future of the scheme, and we will continue to remind them of their commitment. 
• Following the JEP report, UCU, UUK and USS have developed Statements of Purpose and Shared Valuation Principles [pdf] and will continue discussions around scheme governance issues at future talks. 
• On 10 February 2020 UUK asked all USS employers whether they continue to support UUK’s position of keeping employer contribution rates at 21.1%, or whether they would like UUK to make a new offer to UCU. Imperial’s response was as follows: 
• On 19 February 2020 UCEA and UUK published a joint open letter to all staff at universities affected by strike action. The letter provides an update on the significant progress to address concerns of university employees on pay, working conditions and pensions. You can find the letter here and also on UUK and USS employers websites. 

• We submitted our response to the USS debt monitoring consultation on Monday 3 August 2020 - part of the 2018 valuation. View our response.