Your pension, USS, and the changing pension landscape

USS isn’t immune to these changing conditions. Like two thirds of UK defined benefit pension schemes in the private sector, USS has a deficit – but that doesn’t affect our ability to make sustained investments, and our investment performance has been strong.


A defined benefit scheme, like the USS Retirement Income Builder, is a type of pension arrangement that gives a set level of benefits at retirement, based on salary each year and length of service.

In 2006, there were almost 3,500 defined benefit schemes in the private sector still open to new members. Ten years later, there were fewer than 700. By January 2018, just 19 of FTSE 100 companies offered defined benefit schemes to employees, and according to, 11 of those companies had pension liabilities greater than their equity market value.

At USS, we saw our assets in the USS Retirement Income Builder rise to £63.6bn in the 12 months to March 2018, thanks to above benchmark investment performance. That is an increase of £3.6bn over the last financial year which, compared to more than £10bn the year before, reflects the challenging investment environment that is being driven by uncertainty in global markets.

In October 2016, we introduced the USS Investment Builder, the new defined contribution section, offering members greater control and flexibility in their retirement choices. USS is not alone in introducing more innovative hybrid arrangements that combine defined benefit and defined contribution benefits, with John Lewis, BT and Unilever also offering hybrid arrangements in different forms.


A defined contribution scheme is a type of pension arrangement in which the member builds up a pot of savings for retirement. The pot is based on the amount contributed by both the member and the employer, how the contributions are invested and how those investments perform. It differs from a defined benefit scheme in that it does not offer a ‘set level’ of benefits.

The performance of USS Investment Builder funds has also been above benchmark in all but one fund, since they were launched, and this part of the scheme gives you the option of controlling your own investment choices. It also provides a range of flexible ways for you to access any pot you build up.

USS is working hard to ensure we can continue to deliver the best possible retirement outcomes for our members. USS has always been a leader in the UK’s private pensions market, and even as we change to reflect the current challenges, our goal is to ensure that remains the case.

For the latest insights and commentary from USS on the pension landscape, visit Views from USS.