Dear University lecturers - get back to work
Discussion
Tony427 said:
With all due respect back I think I'm a little bit closer to the subject than you are. My wife is leaving far earlier than April 2019, and projections a matter of 8 weeks apart show significant decline in value although the imminent retirement date hasn't changed.
The USS has its very own pension calculator that uses your past salary and contributions history plus your present salary to do exactly what you say that they cannot do, provide a pensions forecast.
Your figures are wrong. Their admitted pensions defecit is now standing at £9 billion not £6 billion as you claim.
The £6 billion defecit is the figure they are desperately trying to down to and which is creating all the unrest within academia.
Also the defecit is not stretched over the next 100 years, its the defecit now , at this moment. Just one university in the MIdlands has a more than £300m defecit. Now multiply that by every University in the land. Then project that defecit with an aging academic population, taking yet more pensions and with employee and employer contributions static or reducing, the management explosion within Universities in the last couple of decades, leading to legions of very highly paid managers retiring with very good pensions, and the defecit as early as 2030 would be approaching the bill for HS2.
I was not saying that the Pensions regulator was dictating investment strategy. I was saying that USS wanted to use a more aggressive risk profile on their investments so that the underlying asumptions on which they base their calculations would enable them to massage the figures to show a lower defecit because the riskier investment strategy would give better forecast returns which gives lower forecast defecit.
They then would be able to say " Crisis, what crisis?"
The pensions regulator told them that they had to keep to their existing risk profile and the whatsit has hit the fan as a result.
Faced with this perfect storm there's only one way that USS pensions will go, and its not up.
Cheers,
Tony
Your posts continue to demonstrate that you have a fundamental lack of understanding of how DB pensions are calculated and how the funding of schemes work. My wife is also a member of the USS so I have a pretty detailed understanding of the benefit structure. I have also worked in the occupational pensions industry for the last 15 years so live and breathe this stuff every day of my professional life. The USS has its very own pension calculator that uses your past salary and contributions history plus your present salary to do exactly what you say that they cannot do, provide a pensions forecast.
Your figures are wrong. Their admitted pensions defecit is now standing at £9 billion not £6 billion as you claim.
The £6 billion defecit is the figure they are desperately trying to down to and which is creating all the unrest within academia.
Also the defecit is not stretched over the next 100 years, its the defecit now , at this moment. Just one university in the MIdlands has a more than £300m defecit. Now multiply that by every University in the land. Then project that defecit with an aging academic population, taking yet more pensions and with employee and employer contributions static or reducing, the management explosion within Universities in the last couple of decades, leading to legions of very highly paid managers retiring with very good pensions, and the defecit as early as 2030 would be approaching the bill for HS2.
I was not saying that the Pensions regulator was dictating investment strategy. I was saying that USS wanted to use a more aggressive risk profile on their investments so that the underlying asumptions on which they base their calculations would enable them to massage the figures to show a lower defecit because the riskier investment strategy would give better forecast returns which gives lower forecast defecit.
They then would be able to say " Crisis, what crisis?"
The pensions regulator told them that they had to keep to their existing risk profile and the whatsit has hit the fan as a result.
Faced with this perfect storm there's only one way that USS pensions will go, and its not up.
Cheers,
Tony
If your wife were to retire on 1 April 2020, she would receive a larger pension than if she retired on 1 April 2019, regardless of what changes they make to the benefit structure. This is because her benefits up to April 2019 will be calculated on the existing basis and nothing that is being proposed will change that.
If she retires one year later in 2020, even if she pays no further contributions in that year the benefit will be greater since the early retirement factor will be different or a late retirement factor will be applied if April 2019 is her NRD.
The funding position of the scheme is irrelevant to the benefit she will receive, unless the whole scheme becomes insolvent. Which with £60bn in assets isn’t likely to happen any time soon.
It actually worries me that people are making serious financial decisions based on the level of understanding that your posts demonstrate.
4x4Tyke said:
It is shocking that so many people can't think this through.
How would you feel is your agreed pension was plundered, you would be pissed.
It is insane that their contracts can respectively rewritten and the public are fine with this.
It’s insane that you would seek to comment on something that you clearly don’t understand.How would you feel is your agreed pension was plundered, you would be pissed.
It is insane that their contracts can respectively rewritten and the public are fine with this.
Nothing is being ‘plundered’ (but a point for emotional rhetoric even if it is nonsense) - pensions earned to date are protected, nothing is retrospectively being rewritten. What is being changed is that the future pension arrangement will be different, that is all.
In the real world, business adapt to changing circumstances and the terms on which employees are employed will necessarily change from time to time. Changes to pensions happened in the private sector 10-20 years ago. Of course people weren’t happy, but businesses have to recognise economic reality.
The same percentage contributions are being paid into a fund for the members benefit, but there will no longer be a guarantee of what those contributions will provide in terms of pension. That is all. If people don’t like it, they have the option of seeking alternative employment. In the real world, however, they may struggle to find an employer who is offering such a generous (18%) DC contribution...
Edited by sidicks on Friday 23 February 12:05
Rovinghawk said:
crankedup said:
For me it makes no sense for the U.K. to give billions of pounds in foreign aid whilst we cannot afford to fund our own requirements.
It's argued that foreign aid is a form of investment that yields more than it costs. I don't know the details but that's the suggestion.crankedup said:
Uni’ lecturers are vital to the future of the U.K. and it makes good sense to me that we value and reward as required to attract the best.
How many groups could the exact same thing be said about, from doctors to roadbuilders?crankedup said:
This is a system so beloved by private industry to reward FTSE boards, many of these people will have been taught in Uni’s.
Many of them will have been breastfed too- your logic suggests that nursing mothers should also have taxpayer money thrown at them. 
crankedup said:
Failure results in further decline in U.K. fortunes, we must invest in the future imo.
I agree with investment but there comes a point where it can't be afforded. We are past that point.Answers must be found, we agree that investment is the future to benefit the U.K. The fundamentals of success must include investment into health, education and infrastcture. Without this we are doomed to decline. Those that educate will take thier skills abroad unless we reward correctly, taking talent with them and those that receive that education are perhaps unlikely to return to the U.K.
As for foreign aid, I have never seen any returns from investment in tangible terms or any numbers. It’s pure madness to give away billions we do not have, portrays political vainity and pomposity whilst our walls crumble around us.
crankedup said:
If we cannot afford to invest then we are doomed. Of course we can afford to invest but it is a matter of priorities imo.
Answers must be found, we agree that investment is the future to benefit the U.K. The fundamentals of success must include investment into health, education and infrastcture. Without this we are doomed to decline. Those that educate will take thier skills abroad unless we reward correctly, taking talent with them and those that receive that education are perhaps unlikely to return to the U.K.
Just claiming that any public spending is ‘investment’, doesn’t make it so.Answers must be found, we agree that investment is the future to benefit the U.K. The fundamentals of success must include investment into health, education and infrastcture. Without this we are doomed to decline. Those that educate will take thier skills abroad unless we reward correctly, taking talent with them and those that receive that education are perhaps unlikely to return to the U.K.
Which universities abroad are providing generous DB pensions?
crankedup said:
As for foreign aid, [b[I have never seen any returns from investment in tangible terms or any numbers[/b]. It’s pure madness to give away billions we do not have, portrays political vainity and pomposity whilst our walls crumble around us.
Where have you been looking?sidicks said:
crankedup said:
Future, what future?
Not far away from reality at all, workers cannot afford to make ends meet whilst in work, never mind contribute for thier pension. Maybe some adventurous investing into emerging markets? don’t know, sidicks may wish to comment fully.
If they weren’t subsidising public sector pensions they have more money to fund their own...Not far away from reality at all, workers cannot afford to make ends meet whilst in work, never mind contribute for thier pension. Maybe some adventurous investing into emerging markets? don’t know, sidicks may wish to comment fully.
I agree with the proposal that a ring fenced taxation element should be used for the NHS and I would be in favour of a similar policy proposal that would work in the education establishment.
sidicks said:
crankedup said:
If we cannot afford to invest then we are doomed. Of course we can afford to invest but it is a matter of priorities imo.
Answers must be found, we agree that investment is the future to benefit the U.K. The fundamentals of success must include investment into health, education and infrastcture. Without this we are doomed to decline. Those that educate will take thier skills abroad unless we reward correctly, taking talent with them and those that receive that education are perhaps unlikely to return to the U.K.
Just claiming that any public spending is ‘investment’, doesn’t make it so.Answers must be found, we agree that investment is the future to benefit the U.K. The fundamentals of success must include investment into health, education and infrastcture. Without this we are doomed to decline. Those that educate will take thier skills abroad unless we reward correctly, taking talent with them and those that receive that education are perhaps unlikely to return to the U.K.
Which universities abroad are providing generous DB pensions?
crankedup said:
As for foreign aid, [b[I have never seen any returns from investment in tangible terms or any numbers[/b]. It’s pure madness to give away billions we do not have, portrays political vainity and pomposity whilst our walls crumble around us.
Where have you been looking?Are you suggesting that investment into education, health and infrastructure would not be a good investment into the future of the U.K., for that is what I am suggesting is good investment.
Generally reading and listening to general National media, Huffpost provides an interesting read but again nothing that can be considered to be a tangible gain imo.
Edited by crankedup on Friday 23 February 12:35
Edited by crankedup on Friday 23 February 12:40
crankedup said:
My position is that the U.K. needs to invest to keep ahead in the race to provide the high quality of education required. That is to attract the best available to provide the education with excellant attractive T&C for the teaching staff throughout.(Pay peanuts get monkeys is the cry in the private sector) and as Uni’s are running as businesses this should be thier priority to be maintained.
You can't run a business effectively if the business model is unsustainable Edited by crankedup on Friday 23 February 12:40
Rovinghawk said:
sidicks said:
Which universities abroad are providing generous DB pensions?
And teach in English?Not difficult to see how this can be expanded and no doubt will be.
liner33 said:
crankedup said:
My position is that the U.K. needs to invest to keep ahead in the race to provide the high quality of education required. That is to attract the best available to provide the education with excellant attractive T&C for the teaching staff throughout.(Pay peanuts get monkeys is the cry in the private sector) and as Uni’s are running as businesses this should be thier priority to be maintained.
You can't run a business effectively if the business model is unsustainable Edited by crankedup on Friday 23 February 12:40
crankedup said:
Do you think that couldn’t very easily be changed. My lads partners brother teaches English in China, they are, as a Nation, very ambitious to attract English teachers.
Not difficult to see how this can be expanded and no doubt will be.
What are his DB pension arrangements?Not difficult to see how this can be expanded and no doubt will be.
crankedup said:
Then you take actions required to make it so, reducing the reward to staff which are the backbone of this business should be the last area to attack. As always the highly paid at the top escape the wrath of the business accountants.
Are the ‘highly paid at the top’ not subject to the same DB scheme changes?crankedup said:
I agree with the proposal that a ring fenced taxation element should be used for the NHS and I would be in favour of a similar policy proposal that would work in the education establishment.
Imagine you raise an extra billion in tax & specifically ringfence it for NHS. Now imagine that another billion of non-ringfenced funding is pulled from the NHS and pissed up the nearest wall on whatever self-serving scheme is around at the time.Ringfencing achieves nothing other than helping emotive claims for more money.
crankedup said:
Do you think that couldn’t very easily be changed. My lads partners brother teaches English in China, they are, as a Nation, very ambitious to attract English teachers.
Not difficult to see how this can be expanded and no doubt will be.
English teachers teaching in English is unsurprising- other subjects might be different.Not difficult to see how this can be expanded and no doubt will be.
Do Chinese Unis have DB pensions? Do they have better payscales than UK? Enough to make up for one helluva commute?
When my uncle lectured at the Sorbonne he had to do so in French.
lauda said:
Your posts continue to demonstrate that you have a fundamental lack of understanding of how DB pensions are calculated and how the funding of schemes work. My wife is also a member of the USS so I have a pretty detailed understanding of the benefit structure. I have also worked in the occupational pensions industry for the last 15 years so live and breathe this stuff every day of my professional life.
If your wife were to retire on 1 April 2020, she would receive a larger pension than if she retired on 1 April 2019, regardless of what changes they make to the benefit structure. This is because her benefits up to April 2019 will be calculated on the existing basis and nothing that is being proposed will change that.
If she retires one year later in 2020, even if she pays no further contributions in that year the benefit will be greater since the early retirement factor will be different or a late retirement factor will be applied if April 2019 is her NRD.
The funding position of the scheme is irrelevant to the benefit she will receive, unless the whole scheme becomes insolvent. Which with £60bn in assets isn’t likely to happen any time soon.
It actually worries me that people are making serious financial decisions based on the level of understanding that your posts demonstrate.
I wouldn't worry , we will be fine, better than fine in fact. Must be the fact that I had already retired early, private pensions all paid up, and now have a pretty healthy life style business/ hobby which is great fun and which is throwing even more cash into my pensions as I mistakenly believe that this is the way to avoid paying tax. If your wife were to retire on 1 April 2020, she would receive a larger pension than if she retired on 1 April 2019, regardless of what changes they make to the benefit structure. This is because her benefits up to April 2019 will be calculated on the existing basis and nothing that is being proposed will change that.
If she retires one year later in 2020, even if she pays no further contributions in that year the benefit will be greater since the early retirement factor will be different or a late retirement factor will be applied if April 2019 is her NRD.
The funding position of the scheme is irrelevant to the benefit she will receive, unless the whole scheme becomes insolvent. Which with £60bn in assets isn’t likely to happen any time soon.
It actually worries me that people are making serious financial decisions based on the level of understanding that your posts demonstrate.
As an economic illiterate, God knows how I managed all that , so must have been the Business degree and the MBA . Or maybe it was the Company directorships which also provided me with my powerful physique and transplanted the hair from my head into a goatee beard. Or maybe it was the college lecturing I did when first retired to "put a bit back into the community" until I realised that colleges are really badly managed sausage factories and the call of commerce drew me back.
Tell me I'm wrong when your wife retires with a smaller pension than she thought she was getting because that is what is going to happen. It is inevitable.
If you think that the funding of the scheme is irrelevant because the assets of the scheme are £60b, you need to put the projected liabilities against this.
The USS have, hence the scrambling about chasing the odd three billion here and there. Its hard to get hold of, I mean you also lost it.
It's actually pretty worrysome for anyone in the USS scheme thats got say 15 to 20 years to go until retirement. All that time to look forward to reduced pension benefits.
Cheers,
Tony
.
Tony427 said:
Tell me I'm wrong when your wife retires with a smaller pension than she thought she was getting because that is what is going to happen. It is inevitable.
Don’t worry, she won’t. Because firstly, I understand how her benefit is calculated. And secondly, she’s leaving the USS next week and will be joining the Hampshire County Council fund, which is still DB. So we’ll be fine too
Tony427 said:
If you think that the funding of the scheme is irrelevant because the assets of the scheme are £60b, you need to put the projected liabilities against this.
The USS have, hence the scrambling about chasing the odd three billion here and there. Its hard to get hold of, I mean you also lost it.
It's actually pretty worrysome for anyone in the USS scheme thats got say 15 to 20 years to go until retirement. All that time to look forward to reduced pension benefits.
Cheers,
Tony
Tony - you seem very confused about what lauda has actually said. Why are you trying to tell a pension expert about DB pensions, when he clearly knows more than you?The USS have, hence the scrambling about chasing the odd three billion here and there. Its hard to get hold of, I mean you also lost it.
It's actually pretty worrysome for anyone in the USS scheme thats got say 15 to 20 years to go until retirement. All that time to look forward to reduced pension benefits.
Cheers,
Tony
Just because you are intelligent with decent (other) qualifications, doesn’t mean that you know more than a pension expert who has been doing this for 15+ years.
Edited by sidicks on Friday 23 February 13:59
4x4Tyke said:
It is shocking that so many people can't think this through.
How would you feel is your agreed pension was plundered, you would be pissed.
It is insane that their contracts can respectively rewritten and the public are fine with this.
Agreed, seems we live in a society and business world dominated by the bottom line only. What really gets my goat is those at the top gorging on money whilst the workers have some crumbs tossed at them. Exaggerated for effect of course.How would you feel is your agreed pension was plundered, you would be pissed.
It is insane that their contracts can respectively rewritten and the public are fine with this.
travel is dangerous said:
here we go. 'simply not affordable' = 'my employer doesn't value me enough to pay for a proper pension scheme'.
err? the employer is the university each employee works for?
Or alternatively..."here we go, let's stick our heads in the sand such that it doesn't matter how economically unviable a situation is, as long as you still get yours" err? the employer is the university each employee works for?
Where do the universities get their money from? (Eventually I suspect we will get to the point where you will realise it is economically unviable for every employee to have over 1m in a pension pot, no matter how valued you are, as the income simply cannot cover that and other running expenses. Including your salaries).
crankedup said:
. What really gets my goat is those at the top gorging on money whilst the workers have some crumbs tossed at them. Exaggerated for effect of course.
And yet you seem to be in favour of huge pensions for some, subsidised by many who will themselves be in straitened circumstances.Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff