Union to Strike over Pensions at 61 UK Universities

The UK’s University and College Union (UCU) said it will stage “an escalating wave of strikes” at 61 British universities after talks over a pension dispute between the union and the employers’ representative Universities UK (UUK) ended without an agreement.

“Staff who have delivered the international excellence universities boast of are understandably angry at efforts to slash their pensions,” said UCU general secretary Sally Hunt in a release. “They feel let down by vice-chancellors who seem to care more about defending their own pay and perks than the rights of their staff.”

The union, which represents more than 110,000 higher education employees, said the strikes will be held over a four-week period, beginning in late February with a five-day walkout. The strikes are scheduled to be held between Feb. 22 and March 16.

The dispute between the two sides is over UUK’s proposal to end the defined benefit element of the Universities Superannuation Scheme (USS) pension and replace it with a defined contribution retirement plan. UCU says this would leave employees with significantly less retirement savings than they would have under the current pension plan.

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UCU said that based on independent modeling of the USS’ pension change proposals, a typical university lecturer would lose £200,000 ($282,800) in retirement savings if the UUK plans were enacted.

In the recent strike ballot, UCU members overwhelmingly supported industrial action, according to UCU, with 88% of members who voted backing strike action, and 93% backing action short of a strike. The union said it hoped that the vote results would spur more vice-chancellors to publicly pressure UUK to agree to a deal.

The union said that two rounds of cuts in USS benefits since 2011 have already left USS members with pensions worth less than those of participants in the Teachers’ Pension Scheme.

“Strike action on this scale has not been seen before on UK campuses,” said Hunt, “but universities need to know the full scale of the disruption they will be hit with if they refuse to sort this mess out.”

Tags: Pension, strikes, UK, University and College Union

UK defined contribution (DC) pension plans grew by £5.4 billion ($7.64 billion) to £48 billion in 2017, a 21% increase from the previous year, according to a new report released by The Pensions Regulator (TPR).

“The success of automatic enrollment has put DC schemes—and particularly master trusts—at the heart of pension saving in the UK, and our figures illustrate this trend,” said Anthony Raymond, head of regulatory policy, analysis, and advice at TPR, in a release. “For these new and existing savers, we have a role to protect their benefits and so we are working hard to drive up standards of trusteeship.”

Raymond said TPR is implementing the Pension Schemes Act 2017, which requires master trusts to meet a clear set of standards in order to obtain authorization to operate.

TPR’s annual DC trust report found that 90% of people currently saving into a private sector pension are doing so through a DC plan. Additionally, memberships are up 29% from the year before to 12.6 million people, and are up by more than 400% since 2010. Master trusts make up a majority of the increase, and account for 10 million DC savers, up from 270,000 at the start of 2012.

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The report also found that while membership and total asset value are on the rise, the number of DC plans continues to decline. TPR said that the number of plans, not including micro or self-administered ones, has more than halved since 2010. to 2,180 from 4,560.

“We welcome the continued reduction in numbers of DC schemes,” said Raymond. “We have been concerned about a tail of sub-standard schemes and have been encouraging trustees who cannot or will not meet the standards we expect to consider consolidation.”

Other key findings of the DC trust report include:

The average asset per membership has declined to £3,900 in 2017 from £4,700 in 2016 due to an increase in the number of first-time pensions savers.

51% of plans use a default investment strategy.

61% of all private sector workplace pension members are in DC plans.

90% of all those currently saving are investing into DC plans.

The total amount transferred out of DC plans has increased by 34% in the past year to £1.7 billion from £1.3 billion.

Tags: Defined Contribution, Pension, The Pensions Regulator, UK