USS funding position -- how to understand the situation?

pinkteapot

grastgirl wrote: »

I'm trying to follow what is written in the UCU proposal. It talks about closing the final salary scheme in favour of CARE, I'm assuming that the final salary entitlement already built up will also go and that all years prior to Apr 2016 would be part of CARE. Am I reading it correctly?

No. As I understand it, entitlement already built up is protected. All contributions made from April 2016 will be CARE, but this entitlement will accrue on top of what you've already built up in FS.

They're closing the FS section to new contributions. What's in there stays in there. At least that's what I've understood so far!

Southend1

pinkteapot wrote: »

No. As I understand it, entitlement already built up is protected. All contributions made from April 2016 will be CARE, but this entitlement will accrue on top of what you've already built up in FS.

They're closing the FS section to new contributions. What's in there stays in there. At least that's what I've understood so far!

FS accrued service remains but FS is defined as date the FS section closes, not FS on leaving employment. Also it's subject to an inflation cap so may be worth a lot less by retirement (particularly if there are a few years of high inflation between now and then).

Southend1

UCU modeller of the individual impact of the current proposals is at http://defenduss.web.ucu.org.uk/whats-my-pension/

NB I couldn't get this working in internet explorer but it was fine on google chrome

pinkteapot

Southend1 wrote: »

UCU modeller of the individual impact of the current proposals is at http://defenduss.web.ucu.org.uk/whats-my-pension/

NB I couldn't get this working in internet explorer but it was fine on google chrome

Just did this. Interesting. Then I saw:

Salaries assumed to increase each 1 August in line with RPI.

Errrrrrrr. :rotfl:

I'm a recent industry joiner so in that horrible CARE section that none of you want to join.

Southend1

pinkteapot wrote: »

Just did this. Interesting. Then I saw:

Errrrrrrr. :rotfl:

I'm a recent industry joiner so in that horrible CARE section that none of you want to join.

Yeah lol at the RPI assumption!

The CRB section isn't bad at all and is in many ways fairer than the FS section so I am not against it in principle. For me I have been paying an additional 1% to maintain FS benefits but now find my final salary will be the salary at the date the section closes and not the date I leave employment which is very unfair.

Also I am worried about the introduction of a DC section as this clearly paves the way for the phasing out of the DB section.

My biggest pet hate with uSS is the inflation capping that was introduced. A couple of years of high inflation could easily wipe a massive chunk off a deferred pension.

I don't have any issue with ensuring the scheme is sustainable but I feel that the trustees have conned us here. Their job is only to establish what contribution rate is needed to maintain scheme benefits, however they have got into bed with UUK in order to start dismantling USS as a DB scheme in preparation for privatisation of the sector. Any proposals for change should come from the JNC.

kidmugsy

Southend1 wrote: »

my final salary will be the salary at the date the section closes and not the date I leave employment which is very unfair.

Yes, it seems harsh to me. I suppose it's just part of the struggle to cope with the existing unfunded liabilities, and to stop more accumulating. Anyway, the remedy is clear: move out of the universities.

Southend1 wrote: »

Also I am worried about the introduction of a DC section as this clearly paves the way for the phasing out of the DB section.

I imagine so; it's what's happening everywhere else.

Southend1 wrote: »

My biggest pet hate with uSS is the inflation capping that was introduced. A couple of years of high inflation could easily wipe a massive chunk off a deferred pension.

The only consolation I can suggest is that you look at the inflation protection you'd get at the PPF. In my case it would be approximately nil.

Southend1 wrote: »

in preparation for privatisation of the sector.

What can this mean? The universities, at least the proper ones, are already private. You are not a government employee.

Southend1

kidmugsy wrote: »

Yes, it seems harsh to me. I suppose it's just part of the struggle to cope with the existing unfunded liabilities, and to stop more accumulating. Anyway, the remedy is clear: move out of the universities.



I imagine so; it's what's happening everywhere else.



The only consolation I can suggest is that you look at the inflation protection you'd get at the PPF. In my case it would be approximately nil.



What can this mean? The universities, at least the proper ones, are already private. You are not a government employee.

There's no prospect of needing PPF assistance. It's the valuation method that's flawed not the scheme.

And I know I'm not a government employee. Universities are charities set up by royal charter. They are far from private companies, despite the desire of government and many VCs to marketise and privatise our higher education system. Unfortunately we have started down the slippery slope but I believe it isn't too late to pull back yet before too much irreparable damage is done.

kidmugsy

Southend1 wrote: »

There's no prospect of needing PPF assistance. It's the valuation method that's flawed not the scheme.

If you mean by that that it's possible to cherry-pick a valuation method that would represent the scheme as prosperous, I'm sure that's true. The same is doubtless true for Detroit.

"There's no prospect of ..." is just complacency.

Southend1 wrote: »

And I know I'm not a government employee. Universities are charities set up by royal charter. They are far from private companies, ....

I didn't suggest that they were private companies. They are "private", in principle, in the same way Harvard is, and that's not a private company. Their difference from Harvard is that they are poor, and accordingly take a large chunk of their funding from the government, leaving them wide open to endless interference. You still haven't really answered my enquiry: what is this "privatisation" that people get their knickers in a twist about?

Southend1

kidmugsy wrote: »

If you mean by that that it's possible to cherry-pick a valuation method that would represent the scheme as prosperous, I'm sure that's true. The same is doubtless true for Detroit.

"There's no prospect of ..." is just complacency.




I didn't suggest that they were private companies. They are "private", in principle, in the same way Harvard is, and that's not a private company. Their difference from Harvard is that they are poor, and accordingly take a large chunk of their funding from the government, leaving them wide open to endless interference. You still haven't really answered my enquiry: what is this "privatisation" that people get their knickers in a twist about?

Privatisation of universities could take a number of forms. Essentially what has already begun is privatisation by stealth. It begins with things like the outsourcing of facilities management, catering services etc. Then potentially moves on to administrative functions. Along with that comes marketisation which is of course well under way, with the money following individual students. There is already an attempt at cultural shift from the top - students are called customers, there is an obsession with numbers and growth, taking on huge debts to find infrastructure. Numbers caps are off, next fee caps will be removed. The next step will be to shift from talking about generating surplus which is necessary for sustainability to profit, and once a clear for profit motive is embedded then the involvement of private companies e.g. Serco in the running of the actual academic affairs of the universities will begin.

And so the privatisation will be complete and we will have wrecked higher education completely for future generations.

kidmugsy

Southend1 wrote: »

It begins with things like the outsourcing of facilities management, catering services etc. Then potentially moves on to administrative functions.

I thoroughly approve of outsourcing activities at which a university has no particular expertise. Should they really do their own window-cleaning?

If outsourcing were to provide a solution to the curse of administrators taking over the universities, that would be a thoroughly good thing.

Neither has anything whatever to do with "privatising" that I can see.

Southend1 wrote: »

Along with that comes marketisation which is of course well under way, with the money following individual students.

I don't know exactly what you mean, but if this is reform designed to give students a better crack of the whip from dons and penpushers, excellent say I.

Southend1 wrote: »

There is already an attempt at cultural shift from the top - students are called customers, there is an obsession with numbers and growth, taking on huge debts to find infrastructure.

I don't like managerialist cant either, but I don't see the point of calling it "privatisation". Mind you, the old tradition (in many places) of the interests of students taking a firm second place to the interest of dons has needed changing. I suppose a bit of twaddle about "customers" would be a small price to pay if the students' interests really were advanced.

Southend1 wrote: »

Numbers caps are off, next fee caps will be removed. The next step will be to shift from talking about generating surplus which is necessary for sustainability to profit, and once a clear for profit motive is embedded then the involvement of private companies e.g. Serco in the running of the actual academic affairs of the universities will begin.

And so the privatisation will be complete and we will have wrecked higher education completely for future generations.

I thought we might be past the age where people would have a fit of the vapours at any prospect of change. Are you a Victorian damsel by any chance? Still, I have to admire a conspiracy theory which links a disagreement about a discount rate to a plot by the Forces of Evil to take over the universities. Well played!