The cost sharing consultation: an update

The employer consultation on the cost sharing provisions is now half way through - you have until Friday 2 November 2018 to leave your response.

The cost sharing provisions would see both member and employer contributions rise and the employer’s 1% matched contribution end from 1 April 2019.

Along with your employer, we will review all feedback to the consultation, so it is important for you to respond before the deadline of 5pm on 2 November 2018.

As our timeline shows, the cost sharing process runs parallel to – but entirely separate from – the JEP process, meaning it was vital for employers to consult with you from 3 September, before the Joint Expert Panel (JEP) published its report.

In our statement on the JEP report, we have reaffirmed that, in the absence of a Joint Negotiating Committee (JNC) decision, cost sharing remains the only default process that the trustee is legally able to operate for addressing the regulatory and legal obligations of the latest valuation.

It is important, therefore, that members take the opportunity to engage with the cost sharing consultation before the window for comments closes.

The proposals put forward by the JEP’s report would require employers to be willing to take on higher levels of risk – and to pay higher contributions – than has been formally expressed to us to date. They would also require increases in member and employer contributions that are higher than the initial 28.3% proposed from April 2019 under the cost sharing provisions.

UUK and UCU are now considering the JEP report, and we will continue to engage with them as they consider their respective positions. This is expected to inform subsequent JNC discussions later this year. We have repeatedly expressed the view that the JEP report could provide the basis for UCU and UUK to agree a way forward that could be introduced before the significantly higher phases of cost sharing increases come into effect, and we sincerely hope that comes to pass.

Published date: 2 October 2018