What is actually going wrong with the government.....this USS scandal is shocking....

FIRSTTIMER

https://www.bbc.co.uk/news/business-49194091

LHW99

Don't actually see this is the government's fault, or that it is a scandal.
Note the article's title says ......"could be"......
There are a number of estimates of funding, depending on which crystal ball is used, and one which suggested the USS should take a similar line of moving staff to a DC scheme, as many other DB schemes have been is now questioned.
Unfortunately no-one's crystal ball is going to be particularly accurate except by luck.

mattvolatile

There's an enormous, ongoing process (including industrial action) about the valuation of the scheme, and members of the trustee body are currently accused of deliberately withholding pertinent information from the union rep on the board. UCU went on strike over this issue, and discussion continues about the details, particularly now focusing on rather technical issues. The best ongoing source of information is probably Mike Otsuka's blog at https://medium.com/@mikeotsuka, and Jo Cumbo at the FT is also paying close attention. https://www.ft.com/content/96cf2da6-7ad8-11e9-81d2-f785092ab560

The union line, based on the findings of an extensive joint negotiation committee including the university employers, is that the deficit is much, much smaller than previously suggested, and further that the trustees' plans to fix the deficit actually cause the problem it's trying to solve. See http://ussjep.org.uk/report-of-the-joint-expert-panel/

The PPF estimate given by John Ralfe (eternal sceptic of the USS, and really the only person ever called on to offer this pessimistic line) is nonsense when applied to the university sector, which operates both financially and practically in an entirely different way from a commercial company like BHS. For starters, USS has a multi-employer covenant, unlike Hoover and BHS which were single companies.

taka

Ok got to ask... why are you asking what is wrong with the government OP? USS is a private DB/DC hybrid pension scheme and is not government backed. From what I have understood to date the numbers are actually slightly less bad that they were!


Thanks for those informative links mattvolatile.

arnoldy

Yes it is quasi private but like most of higher education is basically underwritten by Government, and there is lots of money sloshing around, but it will probably all end in tears. Who is going pay back all the student loans that are written off in 20-30 years? 80%+ by some estimates.

LHW99

Who is going pay back all the student loans that are written off in 20-30 years? 80%+ by some estimates.

Surely not the USS pension scheme though?

Yet_More_Puddylove

The whole USS pension thing is a nightmare. I'm a member, and we have had a 0.8% hike in employee contributions (to 8.8% currently), then to 10.4% from 1st Oct 19, to 11.4% from Apr 20.
It can take USS years (literally) to give you a pension statement.
The website is dreadful - full of glitches, the modellers change every time you use them (for the same inputs) and it's virtually impossible to work out what you will receive.
I believe that UCU are balloting members about further strike action over pensions and pay (the recent pay offer is, I think, 1.8% so effectively a pay cut).

I'm also a TPS member - and the comparison doesn't help USS at all - their communications are clear, their website is simple and informative. No complaints there.

How I wish I could opt out of USS and rejoin the TPS...

mattvolatile

Student loans were largely designed as an accounting trick to turn spending into assets as part of the government's attempt to massage the deficit and debt figures, with a bonus slice of (utterly demented) ideological commitment to (amongst other things) marketisation as a way of improving standards and the long-term erosion of the social contract.

They've been forced to recalibrate their reporting standards recently for the reasons you identify, but in real terms, nothing much has changed. If you buy into this "who will pay it back" line, you buy into what is essentially an accounting fiction pursued almost entirely for political and ideological ends.

hyubh

mattvolatile wrote: »

Student loans were largely designed as an accounting trick to turn spending into assets as part of the government's attempt to massage the deficit and debt figures, with a bonus slice of (utterly demented) ideological commitment to (amongst other things) marketisation as a way of improving standards and the long-term erosion of the social contract.

They've been forced to recalibrate their reporting standards recently for the reasons you identify, but in real terms, nothing much has changed. If you buy into this "who will pay it back" line, you buy into what is essentially an accounting fiction pursued almost entirely for political and ideological ends.

Back on planet earth, student numbers all round, including those from 'disadvantaged backgrounds', steadfastly rose under Blair/Brown governments' tuition fees and loans policy, and rates of participation of the poorest are higher in England than they are in tuition fee-free Scotland.

Still has nothing to do with the USS...

hyubh

Yet_More_Puddylove wrote: »

The whole USS pension thing is a nightmare. I'm a member, and we have had a 0.8% hike in employee contributions (to 8.8% currently), then to 10.4% from 1st Oct 19, to 11.4% from Apr 20.

TPS now - 7.4% if earn less than £27,698, 8.6% if earn between £27,698 and £37,285, 9.6% between £37,285 and £44,209, 10.2% between £44,209 and £58,591, 11.3% between £58,591 and £79,896, and 11.7% if earn £79,896 or above (admittedly the last one is a bit academic for comparison given the lack of a limit on DB pensionable pay). Also limited salary sacrifice options (while still needs employer consent, USS allows for salary sacrifice on regular contributions).

It can take USS years (literally) to give you a pension statement.
The website is dreadful - full of glitches, the modellers change every time you use them (for the same inputs) and it's virtually impossible to work out what you will receive.

I'm also a TPS member - and the comparison doesn't help USS at all - their communications are clear, their website is simple and informative. No complaints there.

Blimey, love for Capita. Sounds like USS administration arrangements (still in house) need 'marketisation' and sold off to the highest bidder...

mattvolatile

hyubh wrote: »

Back on planet earth, student numbers all round, including those from 'disadvantaged backgrounds', steadfastly rose under Blair/Brown governments' tuition fees and loans policy, and rates of participation of the poorest are higher in England than they are in tuition fee-free Scotland.

That's a weird non-sequitor. I'm not sure why you think any of my points would require denying these well known figures, because there's nothing in my post which even suggests that these things aren't true.

But yes... irrelevant to USS, either way!