USS - General discussion

Pat38493

I don’t know anything much about USS pensions, but it’s been stated on other threads in the past that DB pension administrators are under no obligation to inform members in advance if early retirement factors or commutation rates change.  In fact they don’t even have to tell them at all until they individually request an estimate or quotation - at least this is what was stated on other threads, whether or not this is an desirable way for things to operate.

Simes122

Pat38493 said:

I don’t know anything much about USS pensions, but it’s been stated on other threads in the past that DB pension administrators are under no obligation to inform members in advance if early retirement factors or commutation rates change.  In fact they don’t even have to tell them at all until they individually request an estimate or quotation - at least this is what was stated on other threads, whether or not this is an desirable way for things to operate.

I don't think it's desirable - but yes they have made factor changes almost under the radar before.  I think it's the timing of this one, coincident with precursor announcements that some people planned around.   Eg retire after 1 Apr 24, and you'll get more money was the inducement, but the catch is that the factor change was not signposted in a similar timeframe, so we've made long term decisions based on incomplete info.  That's my beef.  Had I known I wouldn't have just extended my employment contract to end April for example.  A bit of stability was perhaps what I was hoping for.

MPLMPL

Pat38493 said:

I don’t know anything much about USS pensions, but it’s been stated on other threads in the past that DB pension administrators are under no obligation to inform members in advance if early retirement factors or commutation rates change.  In fact they don’t even have to tell them at all until they individually request an estimate or quotation - at least this is what was stated on other threads, whether or not this is an desirable way for things to operate.

No doubt true; however, see below from USS guide for IFAs. The factors have been reviewed after each triennial actuarial valuation. After the March 2020 valuation, new ERFs were published to be used from April 2020. After the March 2023 valuation, ERFs published to be used from April 2023. Wasn't expecting them to be reviewed until April 2026.

Simes122

MPLMPL said:

Pat38493 said:

I don’t know anything much about USS pensions, but it’s been stated on other threads in the past that DB pension administrators are under no obligation to inform members in advance if early retirement factors or commutation rates change.  In fact they don’t even have to tell them at all until they individually request an estimate or quotation - at least this is what was stated on other threads, whether or not this is an desirable way for things to operate.

No doubt true; however, see below from USS guide for IFAs. The factors have been reviewed after each triennial actuarial valuation. After the March 2020 valuation, new ERFs were published to be used from April 2020. After the March 2023 valuation, ERFs published to be used from April 2023. Wasn't expecting them to be reviewed until April 2026.

Ooh that is really interesting!  I wonder what the scheme rules say and why have they modified the factors out of sequence and are they allowed to do that outside of a triennial actuarial valuation.

Grant1968

Simes122 said:

I have raised a complaint to USS over this. 

The lack of comms is shocking and tbh, once people digest this information, I think many will lose what little trust they had left in USS and vote with their feet.

I too have raised a complaint (complaints@uss.co.uk). If enough members complain, perhaps we can buy a bit of breathing space.

Simes122

Worth complaint publicly on Twitter - a couple of us have already.   I’ve established that the worse ERF more than eradicates any gain I had from the so called restoration of benefits.  I’m worse off overall than if they hadn’t done that!  Cant be right.

dsw_123

I tried playing about in the modeler to see if I could see any large drop if I pushed my retirement beyond  April 2024.  Instead I just saw small month by month increases which makes me wonder if these changes have been implemented correctly/fully in the modeler as when I did the sums myself I saw an about 10% drop in my projected pension (admittedly based on just on the figures in the retirement builder breakdown) before and after the changes to the ERFs.

I have used the contact us option on the USS website to express my view that these changes are out of keeping with the expected timeframes for ERF reviews  and questioning the lack of publicity in contrast to the cuts in contribution rates and the lump sum.

My employer had the gall to describe the reduction in  contribution rate as "like getting a payrise", funnily enough  I don't recall them describing the rise in contributions as " like taking a pay cut"

Universidad

dsw_123 said:

My employer had the gall to describe the reduction in  contribution rate as "like getting a payrise", funnily enough  I don't recall them describing the rise in contributions as " like taking a pay cut"

I have a lasting memory of the employers justifying one of the USS pension cuts based on a model that included an expectation of significant pay rises year on year, and those same employers refusing to give us anything close to what their model assumed, in the pay negotiation going on at the very same time.

Grant1968

dsw_123 said:

I tried playing about in the modeler to see if I could see any large drop if I pushed my retirement beyond  April 2024.  Instead I just saw small month by month increases which makes me wonder if these changes have been implemented correctly/fully in the modeler as when I did the sums myself I saw an about 10% drop in my projected pension (admittedly based on just on the figures in the retirement builder breakdown) before and after the changes to the ERFs.

I have used the contact us option on the USS website to express my view that these changes are out of keeping with the expected timeframes for ERF reviews  and questioning the lack of publicity in contrast to the cuts in contribution rates and the lump sum.

My employer had the gall to describe the reduction in  contribution rate as "like getting a payrise", funnily enough  I don't recall them describing the rise in contributions as " like taking a pay cut"

I spoke to USS on Monday and they confirmed that the new factors are not included in the online calculator. Never mind though, the factors will be included after 1st April, when obviously it will be too late to change plans. Reminds one of major major in Catch 22...

NickBFS

Grant1968 said:

I spoke to USS on Monday and they confirmed that the new factors are not included in the online calculator. Never mind though, the factors will be included after 1st April, when obviously it will be too late to change plans. Reminds one of major major in Catch 22...

Even if they were included now, it would be too late for most people as most institutions tend to have a 3 months notice requirement for retirement. They would have needed to be publicised and incorporated in the calculator last year to allow most people to take them into account in their planning.