Higher education union UCU is balloting for strike action over university bosses’ plans to scrap guaranteed pension benefits from the Universities Superannuation Scheme (USS).
At the moment, higher grade staff in the older “pre-92” universities get a pension based on their average earnings across their career. This is already on worse terms than staff in newer universities and school teachers. But now the employers want to scrap even this deal in favour of making our pensions entirely dependent on the performance of pension scheme investments. A consultative ballot saw over 86% voting that they’d be prepared to take action, even before the worst of the plan became clear.
The backdrop to the employers’ move is a deliberate decision by the Government and its regulators to insist on such “prudent” investing that it’s almost impossible for pension schemes like USS to demonstrate they have sufficient funds to pay pensions in the worst case scenario. But the regulator’s “worst case scenario” involves an almost complete collapse of the UK university system. If things get that bad, pensions are unlikely to be anyone’s main worry. It’s an excuse to cut the pay that staff expect to receive in retirement.
University bosses are already making cuts to try and compensate for a likely financial dip due to Brexit and a fall in the number of 18-year-olds. They will fight to keep their pension contributions down. But they have the money. Staff costs have fallen as a percentage of university expenditure. At Southampton University (where on top of the pensions attack management is trying to cut 75 jobs), the figure was 60% a decade ago and just 53% now. Between 2014 and 2018 English universities increased their capital spending (on buildings, for example) by 60% as they sought to win new students with showy campuses. The consequence of marketisation in higher education is that more money goes on these projects, and less is left for the bread-and-butter costs of running a university.
Saving the “defined benefit” element of USS will not be an easy win. UCU is rightly warning that it will need sustained strike action, not just a day here and there. But this is a fight it is vital to win. Vote Yes!
The ballot opens in the week beginning 27 November.