Earlier this year, the UCU strike action affected over sixty-four universities in the UK, with Newcastle University being one of them. After a blog post was published on the 13th of October analysing data given by USS, a discussion over the necessity of the pension deficit was reopened, leading to allegations that the USS had made an “error” in cutting pensions.
According to the Newcastle University UCU Branch, one of the main reasons for the strikes was the fact that “Newcastle University management (along with many other Russell Group institutions) want to change the USS pension scheme” in a way that could be “likely to reduce the value of... lecturers’ pensions to below subsistence levels”. This cut to staff pensions was caused by a supposed deficit in the USS that many people suspected was inaccurate, including Newcastle University student Jamie Cameron who wrote an article about on the topic for The Courier last year.
According to Jamie, Test 1, the method that USS use to produce their deficit projection, assumes the premise that every university in the scheme could collapse tomorrow and works out the deficit based on that scenario. Many hold the opinion that this made the pension cuts unnecessary because, as Jamie put it, “notion of a £7.5Bn deficit rests on an outcome which is practically unthinkable”.
In a blog post published on Medium, Dr Sam Marsh, a UCU representative and lecturer at the University of Sheffield, analyses the data provided by USS and argues that it was unnecessary to cut staff pensions. USS Briefs concluded from the blog post that “the Universities Superannuation Scheme is not in deficit according to its own valuation methodology”.
Dr Marsh told The Courier:
“Put simply, the long-term health of the pension scheme is much better than those with full access to the data have ever let on. There are now some pretty big questions over why this new data (which was) only released last fortnight even though I had asked for it over a year ago had (been) withheld until now.
“It is extra weight behind the claims that staff were making that the changes to the pension scheme were unnecessary. We should never have had to strike to make those in charge listen to us properly and look at the evidence.”
In a post to their website on the 16th of October, the USS disputed Dr Marsh’s claim of a “large and demonstratable error in the valuation”. They argued that: “The commentary that this analysis has generated is based on an incomplete understanding of the scheme’s current funding proposals and of regulatory requirements.” The post also claimed that Dr Marsh’s analysis was “not an adequate premise on which to set the funding arrangements for the scheme.”
When asked his opinion on this response, Dr Marsh said that the post was “interesting, to say the least” and claimed it did not directly address his concerns, instead attempting to “switch the emphasis away from the criticisms I was making onto other related matters.”
“I would have hoped for a more grown-up response to my findings, which are substantial and do need addressing properly.
In terms of supporting university staff, Dr Marsh said: “What staff and students want are almost always aligned. The problem is, those at the top increasingly see universities in terms of financial gain, helping themselves to large student fees while at the same time cutting back on their staffing costs. This has to stop!”