Uss

kidmugsy

Imastu, james d, what do you make of this (which I came across by googling)?
http://www.pinsentmasons.com/PDF/AGuntoyourHead-Auto-EnrolmentandtheUniversitiesSuperannuationScheme-June13.pdf

The words "pyramid scheme" come to mind. Also, 'why tackle a big problem when you can tackle a huge one?' Or are they trying a subtle ploy to see whether any institution wants to grasp a very expensive nettle and leave the scheme? But those would surely be the employers you'd least want to lose?

I dunno: I wonder what they're thinking about all this at Trinity, Cambridge?

Imastu

I took part in the formal response to the consultation for that change to the USS rules in respect of auto-enrolment - and I think the nice lawyer from Pinsent Mason has got the wrong end of the stick.

It was already mandatory for universities to enrol eligible employees in the USS, all the 2012 change did was confirm that the appropriate pensions scheme for autoenrolment of USS-eligible employees (i.e. those at or above a certain 'grade') was the USS. And the 'sanction' (or leaving cost) for any institution seeking to exit the USS was set in place donkeys' years ago.

I do think there is some scaremongering going on in the media commentary, things like the 'biggest deficit' - well it's the biggest scheme, so duh? And no mention of the fact that the deficit is much the same as it was last time it was formally revalued. Or that the percentage fundings (all 4 different ones) are much the same, and also similar to those rare examples of private sector final salary schemes.

No, it's not cast-iron safe. Nor is it notably any more in danger than it has been. As at June 2013, the position was that it had assets of £37.9bn, liabilities valued at £45.8bn (down from £50.1bn three months earlier). If you tweak the discount rate applied to those liabilities, it is in surplus. If you move it slightly the other way, it is in a massive deficit.

C'est la vie. Or in this case, more a case of c'est la mort?

Re Trinity College Cambridge (et al), I would think they're a bit miffed. But as I said, they acquired their wealth through luck and dubious means (well they were given it by people who acquired it through dubious means - slavery, Victorian industrial exploitation, overseas land grabs...) so in a word, tough...

kidmugsy

Imastu wrote: »

C'est la vie. Or in this case, more a case of c'est la mort?

Oh I doubt that Trinity will be left holding the bag: they'll cry "enough is enough" and clear off early, viewing the exit charge as money well spent. Less "last man standing" than "first man running", or so I assume. Unless the LSE beats them to it - but they might be short of the capital needed.

But my main point remains: the "media scaremongering" of 2005 proved to be right; USS proved to be woefully wrong. Why should they be trusted this time around when they sing the same song?

Perhaps it scarcely matters: perhaps soon enough it'll be a closed scheme and academics will be contributing to a DC scheme instead. Or perhaps Something Will Turn Up. My guess is that a lot of elderly people will go through lengthy periods of anguish over this.

I take it that even a closed USS would still be a formidably large entity, consuming money on a considerable scale. I don't know whether there is any precedent for a big multi-employer scheme folding: do you?