Your questions answered

Question asked by Pina, Professional services

The negotiations are carried out by the Joint Negotiating Committee (JNC), which is made up of representatives of Universities UK (UUK) on behalf of employers and Universities College Union (UCU) which represents members. Along with an independent chair, they discuss and set the level of future pension benefits - if we find that USS needs to change contributions, the JNC decides how these should be shared between employers and members, or whether there should be a change to future benefits. If the UCU and UUK representatives cannot come to an agreement the chair can exercise their casting vote.

Our role is to make sure the benefits you’ve been promised can be paid. To do this we carry out valuations which are required by law at least every three years. These valuations calculate our funding position – they act like a financial health check for the scheme. We share this information with the JNC, which decides what should happen next. Find out more about the part we play in your pension.

Question asked by Richard, Research Fellow

At the moment, this is in the early stages. The JNC has set up a working group, which is looking at what changes could be made to reduce the cost of the scheme to members so that less members leave because of affordability. This group is developing a report which will be discussed by the JNC in April after which a consultation with stakeholders is expected to follow. You can find out more about this in a recent update from UUK.

Question asked by Rebecca, Professor

We don't have a view on the affordability of the contributions involved, that is a matter for the JNC to decide. Our primary legal duty as trustee of USS is to protect the benefits promised to USS members. The JNC – made up of UCU and UUK representatives, and an independent chair – decides what benefits are provided and how the contributions required to fund those benefits are shared between members and employers. You can read more on this and the UCU proposal here.

Question asked by Siobhan, Lecturer

As of 1 April this year, the salary threshold will reduce from £59,883.65 to £40,000. A joint contribution from you and your employer of 20% of your salary above £40,000 goes into the Investment Builder. Your employer covers the cost of the administration and managing your investments, so you don’t need to worry about the cost of that.

In terms of how you pick where you invest, you have two options. The first option, Do It For Me, is where our team of investment experts manage your funds for you. This is the default option, and we’ll automatically assign you this option, unless you tell us otherwise.

The other option, if you want to manage your own investments, is to choose Let Me Do It. To do this you need to log in to My USS. In the Investment Builder section of My USS you’ll get a choice of 10 funds to choose from, and you can invest in one or more of them. They range from lower risk funds with possible lower returns, to higher risk funds, with potential higher returns. You can find out more about this on our Investment Builder page.

In terms of how this works when you retire, the Retirement Income Builder will give you a guaranteed income for life and one-off cash lump sum. You can dial up your monthly pension and reduce the lump sum or vice versa – that’s up to you. Your Investment Builder, on the other hand, will give you a savings pot. The value of this savings pot will depend how much you’ve paid in and how well your investments have performed. However, you don’t need to take your Investment Builder savings at the same time as your Retirement Income Builder, you can leave it invested or you can take it earlier.

And you can take your Investment Builder pot in a variety of ways, including cash payments, drawdown, and using it to buy a guaranteed income for life by purchasing an annuity. It’s worth reading more about this on our using your Investment Builder pot page.

Question asked by David, Professor

Employment in the Higher Education sector has evolved, with more mobility amongst academics, but also increases in the number of professional services staff enrolled into the USS pension. This has meant more members leaving with less than two years’ service who until 1 April 2022 had different options available to them compared to those members with more than two years’ service. The JNC considered these issues and decided it was appropriate that these members build a full pension on the same basis as everyone else. This means that members who aren’t sure about their long-term future in the sector can join USS with confidence that whatever happens, they are building a valuable pension with a significant employer contribution.

Question asked by Paul, Professor (retired)

No. The JNC’s changes will only impact benefits built up after 1 April this year, so if you’re already retired, it won’t impact your pension.

The benefits you’ve already built up are safe and secure and are protected by law, and that goes for the benefits already built up by non-retired members too.