Conditional Indexation: second report (December 2025)

UCEA and UCU have been working with support from the USS trustee to consider how to achieve greater stability in the scheme over time, reducing the volatility in contribution rates and Retirement Income Builder benefits seen in recent years.

As part of this work, UCEA and UCU agreed to explore Conditional Indexation (CI) benefit design options to identify if CI could improve USS member expected outcomes and/or deliver improved contribution and benefit stability within an affordable cost envelope for members and employers compared to the current Retirement Income Builder benefit design.

The first of two planned reports, published in June 2025, provided an interim update on progress and highlighted areas for further exploration.

The second report, available here, is designed to assess potential benefits and drawbacks of CI to assist UCU and UCEA in engaging with members and employers about whether exploration of CI should continue to a more detailed design phase.

It explores how decisions related to CI – particularly indexation – could be structured, governed, and communicated; quantitative modelling to assess the potential impact of CI on benefits and contributions under various scenarios, and; the development of criteria to evaluate whether CI offers a viable and balanced alternative to the current Retirement Income Builder design.

It does not seek to set out an optimal design for the benefits or governance structure that would apply under CI. Instead, it sets out the important trade-offs for members and employers that would be involved if the scheme were to move to a CI benefit structure to help inform whether an acceptable balance could be found.

Information on conditional indexation is also available on UCEA and UCU’s websites.