Staff at 52 UK universities are planning to strike over pensions over 14 days in the coming two months after talks with employers in the £70.1bn (€78.2bn) Universities Superannuation Scheme (USS) failed to satisfy their trade union.

The University and College Union (UCU) announced the planned strike action yesterday, saying it would start on 20 February and “escalate each week” to culminate with a week-long walkout in March. At the vast majority of the 52 universities the strike action is over pay as well as pensions, and follows walk-outs by UCU members at 60 universities in November and December.

Representatives of UCU, Universities UK (UUK), and USS have been holding joint talks since last month about USS.

According to a spokesperson for UCU, the trade union’s higher education committee was “not satisfied that employers were doing enough and sanctioned this next round of strikes”. This was on the basis of feedback from the tripartite meetings, which was presented to the UCU committee on Thursday.

This followed the last of five initial meetings scheduled for January, which have been facilitated by Joanne Segars, the chair of the joint expert panel appointed to help resolve the dispute about USS. The faciliated meetings were agreed to after the panel published its second report.

A spokesperson for UUK, the body for employers, said it regretted that further strike action was being planned “at a time when positive talks on the future of the scheme are making significant progress and are ongoing”.

“If universities want to avoid further disruption they need to deal with rising pension costs, and address the problems over pay and conditions”

Jo Grady, UCU general secretary

Benefits funding tussle

According to UCU, its general secretary Jo Grady has said that action by the trade union’s members has made employers more cooperative but “we haven’t seen the movement we need”.

“If universities want to avoid further disruption they need to deal with rising pension costs, and address the problems over pay and conditions,” she said.

The UUK spokesperson said the trade union wants employers to pay “still higher contributions at unaffordable levels”.

Employers had agreed to cover 65% of increased costs for maintain current pension benefits, taking their contribution to 21.1% of salaries from October 2019, amounting to a collective additional £250m a year, the spokesperson said.

“Members have been asked to make a fair contribution, too.”

Under the 2018 valuation, USS members’ contributions have been 9.6% of salaries since October and are due to rise to 11% from October 2021, with employers’ contribution set for an increase to 23.7%.

According to the spokesperson, the talks between UCU, USS, and UUK were set to continue at least until March and “are building a shared understanding on the future of the scheme, jointly developing governance reforms and considering alternative pathways for the 2020 valuation”.

The UCU spokesperson said the trade union would be continuing with the joint talks, and hoped that “real progress can be made” before 20 February.

In her latest update – about the fourth of five meetings that have been held – Segars said “the tripartite group continued to hold productive discussions”.

2020 valuation

USS is currently engaging with UUK, UCU and The Pensions Regulator about the methodology for its next valuation, which has to be completed by 30 June 2021 and will be based on a snapshot of the scheme as at 31 March this year.

In a recent update to USS employers, the pension scheme said “clear and collective financial commitments” to USS would be crucial to maintain the highest covenant rating possible for the 2020 valuation.

While it was possible that USS could contemplate taking more risk in its investment strategy, “this would require employers to further reinforce their commitment with some form of security”, the scheme added.

According to the update, USS is to send to employers a discussion document next month to get their views on some of the main features of the 2020 valuation, including USS’s proposed methodology and overviews of the approach to the covenant and risk appetite.

USS indicated that as at the end of 2019 the cost of funding new pensions looked to have increased by around 3%, from 28.7% of payroll to 32%, although this was on the basis of the methodology and demographic assumptions used for the 2018 valuation.