Frequently asked questions

It's firstly important to understand what a valuation is assessing. It aims to assess what assets a pension scheme currently has to fulfill its future commitments, and how much it is reliant on market-dependent investments to make up any shortfall in the future. The scheme is legally obliged to incorporate prudence into a valuation to ensure that if the risks they are taking don’t deliver the expected returns it is still able to pay the pensions already promised now and in the future. In this sense, every valuation is an assessment of risk: how much risk is the Pensions Regulator willing to accept for the latter to make up for the former? 

The 2020 valuation revealed a worsening of the scheme’s funding position - a sizeable deficit - which means additional contributions would be necessary to fund the scheme’s current benefit structure. The cost of future pension promises has also risen. 

As such, if the scheme wishes to retain its current benefits structure without taking a level of risk unacceptable to the Pensions Regulator, an increase in contributions is required. An alternative route would be to reform the current benefits structure to keep the cost within the current contributions being paid. This impacts on the benefits members receive in the future (but would not affect pension earning already accrued).

The USS participation agreement has an exclusivity clause, which means that you cannot change to a different pension scheme.  

The only exception is for SAUL members who are promoted whilst at Imperial and choose to remain in SAUL. 

If Imperial were to leave USS, we would still be required to pay our deficit recovery contributions upfront before being allowed to do so. The cost of this would be financially impossible. Due to the size of our commitment to the scheme, it is estimated it would be a multi-billion-pound cost.  

Despite the proposed contribution increases, USS does remain a valuable pension for staff in the Higher Education sector. The employer contribution rates are significantly higher than in other schemes, and the benefits offered are competitive with other public sector pension schemes.