The governance of one of Lancaster University's two staff pension schemes has been put under the spotlight following the release of a major report.
Universities Superannuation Scheme (USS) is a pension scheme for academics and professional services staff nationally and it is the richest pension scheme in the UK, with a portfolio of over £60 billion. Depending on grade, the staff at Lancaster can either join USS or the Local Government Pension Scheme.
USS has been under significant scrutiny in recent years, and issues relating to it caused both the 2018 and 2019 University and College Union (UCU) strikes. The 2018 strike happened because UCU disagreed with an actuarial valuation of the pension scheme. The Joint Expert Panel (JEP) was formed to investigate this valuation by UCU and Universities UK (UUK), an advocacy organisation for university leadership. The first JEP report was released in September 2018, but its recommendations were effectively ignored by USS. This then helped cause the 2019 UCU strike, although that strike was also over pay and conditions.
On 13th December 2019, JEP released their second report. It made a series of recommendations, including the creation of a series of joint bodies within USS such as a valuation forum and a high-level joint union/employer steering committee; improvements to the Joint Negotiating Committee composed of UCU and UUK representatives; a new jointly-agreed purpose statement; a more appropriate valuation methodology informed by this purpose statement; and, an investigation into different approaches to contributions to look into the high level of scheme opt-outs among young and lower-paid staff.
UCU welcomed the report. Dr Jo Grady, UCU General Secretary and Lancaster alumnus, said that if it was implemented it 'should give scheme members greater confidence about how the scheme is run.'
There have long been concerns about the ethics of USS, which invests huge sums of money into fossil fuel companies, arms manufacturers, tobacco companies, and so on. Dr Grady, in her campaign to be elected UCU General Secretary, wrote that 'the single most important thing UCU can do is to force USS to divest from its large direct fossil fuel holdings and invest in green assets instead.' USS has been heavily criticised by scheme members for unethical investments, for instance in cluster bomb manufacturers Textron and oil company PetroChina.
The USS response to suggestions that it should divest from unethical investments is that if they did that, they would not have a 'seat at the table' and wouldn't be able to push companies for 'positive change'.
UCU has a mandate to go back on strike over USS until the start of March. Under the Trade Union Act 2016, which further restricted the power of trade unions to defend their members against unscrupulous bosses, ballots for strike action expire after six months. The UCU ballot opened at the start of September and so in order to go on strike after March, Lancaster UCU will have to re-ballot its members.
This may not be necessary, however, as UCU has recently announced a round of talks on the future of USS. The talks will be facilitated by the chair of JEP, Joanne Segars, and will include high-level representatives from USS, Universities UK, and UCU, including Dr Grady. There is a serious hope that these talks will avoid the necessity for further strike action, as Dr Grady said, 'If we are to avoid further serious disruption at universities over USS then all parties need to work on these key issues... and look at how to deliver a fairer and more sustainable valuation process.'