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Universities going bankrupt (either morally or financially) thread


sancho panza

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I thought we had Uni thread but after 20 minutes searching couldn't find one....

Anyway,rumours have been circulating for some time that some are in trouble due to demographics/new shiny building sprees/vice chancellor pay/kids working out £50k for an Outdoor Adventure Degree to work in a facility with other people on minimum wage is a bad idea/debts/lack of foreign students etc etc.

image.png.4fd4fcd576b9a682e7fef68f56e96850.png

https://www.telegraph.co.uk/business/2024/05/16/third-rate-universities-selling-visas-rather-than-education/

Third-rate universities selling visas rather than education deserve to go bust

It’s time for fat cat vice chancellors to stop rubber stamping Uber driver applications

The Department for Post-Feminist studies needs extra staff. A new meeting room for the decolonising arithmetic research group needs to be finished. And it would be a shame if the summer trip to Cuba for a conference on imperialism couldn’t be paid for.

With the Government finally starting to restrict the visa bonanza fuelling the dizzying growth in student numbers, the Left and the university lobby are beginning to panic.

The bleating is delicious to listen to. We are, we are told, about to shoot ourselves in the foot, hampering one of our premier export industries.

This is nonsense. Universities cannot expect the UK to organise its immigration system solely to suit their business model.

If they can’t get by on selling visas they will have to get by selling education instead. It’s time for the fat cat vice chancellors to earn an honest living rather than rubber stamping the applications of Deliveroo riders and expecting bailouts from a country increasingly weary of their industry.

After all, they must have known that the visa boom wouldn’t last forever. The absurdly generous system put in place after we left the European Union allowed anyone studying for an undergraduate or postgraduate degree in the UK to stay and work in this country for up to two years after graduation, and even more significantly, bring dependants as well

In the year ending last September, 153,000 dependants of the 486,000 people on “study” routes were given visas to come to the UK, compared to just 15,000 in the year ending September 2019.

This was a clear absurdity, pushing immigration to ludicrous heights. Universities that were designed to be places that primarily advance human understanding of the world were being turned into visa machines; their main role in our new high skill, high wage economy was to keep Deliveroo and Uber supplied with low-cost drivers from anywhere in the world. 

It is possible the Government simply didn’t anticipate this behaviour, trusting universities to exercise restraint. If so, it was badly mistaken and Rishi Sunak has rightly clamped down on this route. The number of dependants being brought to the UK by foreign students has fallen 80 per cent, and it is likely that there will be further reductions as the year goes on.

This is good news for Britain but terrible news for the college High Table. As such, we are now witnessing an alliance between the open borders Left – taking a brief pause from its calls to bring half of Palestine to Britain on refugee visas – and the self-interested bureaucrats of the Higher Education machine worried their cushy gigs and over-inflated paychecks may suddenly be unsustainable. 

Between them, they make two arguments why the clampdown is a terrible mistake. The first is that without the revenue from foreign students, fees for British students will have to rise. The second is that it might even mean that some universities go bust, destroying jobs in regional towns and cities where they are often major employers. 

Seriously? If that’s the best they can come up with, then it might be time for a few first-year refresher courses. We could start with introductory economics.

Everyone agrees that higher education is a world-class British industry and one that deserves to be nurtured. Foreign students bring in valuable export earnings and some go on to be world class academics in our institutions. Others work overseas but retain links to, and affection for, Britain. No one would want to end any of that. It is a valuable asset, and one that is second only to the United States. 

But that doesn’t mean that the current regime is fit for purpose. If we are bringing in the “best and brightest”, that’s hard to square with the explosion in visas for taught masters courses at lower ranked institutions. Britain’s economy would tick over just fine without them, as it did before the post-Brexit liberalisation.

And given the strong public opposition to the measure, the universities can hardly expect Westminster to allow immigration policy to be dictated by the need to keep their cashflow healthy. The current rate of net migration has become politically unsustainable, and students, with the graduate visa extensions, are playing a major role in the explosion.

We simply do not build enough homes to meet the growing demand. For that matter, we don’t build the reservoirs or transport capacity, either.

Given that we would be unlikely to change our immigration policy simply to suit other industries, there’s no reason why we should design it solely to keep higher education in good financial shape either. Policy needs to be set for the health of the overall economy and the social fabric of society, and if that means some sectors need to make changes to the way they operate then that’s just the way it goes. 

If a few universities go bust in the process, so be it. There is no iron law that says the UK needs 160 odd universities. If a dozen or so were forced to merge, consolidate, or even close their doors completely, it is quite likely to be healthier for the entire system, proving that their existence can’t be guaranteed and forcing a few to rethink their business model.

If the universities can just find a professor of economics or business somewhere on the campus, they will be able to explain what happens to companies that fail to adapt to changing circumstances.

It’s time to let universities swim – or sink – on their own.

Edited by sancho panza
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this is worth a read,I think it was psoted into public epnsions thread

USS looks like a ponzi as younger academics appear to be dropping out for a variety of reasons undermining future solvency

https://www.hepi.ac.uk/2020/11/24/why-the-pandemic-is-likely-to-produce-a-shift-in-academics-pension-arrangements/

Why the pandemic is likely to produce a shift in academics’ pension arrangements

  • 24 November 2020
  • By Nick Hillman

The largest private sector pension scheme in the UK …

A couple of years ago, I spent much of the Christmas break in a Reading Room at the British Library. I was investigating the history of the Universities Superannuation Scheme (USS). It was more fun than it sounds.

The report I wrote built on the knowledge I gleaned while working for the pensions industry during the 2000s. It provided some fairly basic reminders about the USS.

For example, it emphasised that the USS is a private sector, not a public sector, pension scheme. Indeed, it is the largest private pension scheme in the UK. This matters, as its status (huge and private) makes it unlikely the Government would ever subsume the scheme, as many people seem to envisage.

(Yes, the Royal Mail Pension Plan was absorbed but the Royal Mail was being prepared for privatisation. With universities, the direction of travel would be in the opposite direction – absorption would pull autonomous universities closer to government, which would be bad for institutions that lost autonomy and bad for government that took on more debt.)

… with the largest deficit …

In my pamphlet, I noted that the USS faced the largest deficit of any pension scheme in the UK. I also pointed out that it is younger than many people suspect, having been established on April Fool’s Day 1975, nearly a decade after the high point for post-war occupational pension scheme membership in 1967. (According to the Office for National Statistics, occupational pension scheme membership doubled between 1953 and 1967 to 12.2 million, after which it fell back to 7.8 million by 2012.)

Despite its relative youthfulness and despite the fact that it has since ballooned to include 340 employers, the USS primarily covers staff (and former staff) at older universities. Staff at newer institutions typically come within the Teachers’ Pension Scheme and there are many other pension arrangements in the higher education sector too (such as the Local Government Pension Scheme, individual universities’ schemes for support staff and schemes for student unions’ sabbatical officers).

The challenges faced by the USS at the time I was working on my paper during Christmas 2018 remain but some have become worse and some have become clearer.

By far the biggest damage [to university finances] will come through its impact on the University Superannuation Scheme, not on things like whether they can keep attracting students

Paul Johnson, ifs

One thing that has become worse is the USS deficit. On one conservative measure, the deficit rose from £5.4 billion to £12.9 billion in the year to March, before the pandemic took full effect (as assets declined by £900 million and liabilities rose by £6.6 billion). Now, according to new analysis by the Institute for Fiscal Studies (IFS), ‘the effect of the pandemic on funded defined-benefit pension schemes sponsored by universities’ is the ‘most important risk to university finances arising from the COVID-19 pandemic.’ In The Times, the Director of the IFS, Paul Johnson, put it even more bluntly: ‘By far the biggest damage [to university finances] will come through its impact on the University Superannuation Scheme, not on things like whether they can keep attracting students.’

… and a high opt-out rate …

One thing that was already an issue back in 2018 but is now discussed more is the comparatively high USS opt-out rate – in recent years, between 15% and 21% of eligible new USS members have chosen not to be in the scheme. In days gone by, occupational pension schemes were deemed so valuable that paternalistic policymakers allowed them to be compulsory. Such a lack of choice did not sit well with the individualism of the 1980s so compulsion was made illegal – and just as the huge additional costs encountered by defined benefit pension schemes began to provide an incentive to drop out.

Given that the pension contribution of each active USS member unlocks a much larger pension contribution from their employer, it seems odd that anyone would refuse to join (especially now that automatic enrolment is the norm for workplace pensions). But having cash in hand now, perhaps in order to cover childcare costs or rent, can be a more urgent priority than having a greater sum gathering up for use in the distant future. (As a new graduate, I opted out of the Teachers’ Pension Scheme. It felt necessary but now it feels like I looked a gift horse in the mouth.)

As a result of such opt outs from the USS, the academic world is not bifurcated – as many people believe – into permanent positions and the precariat. It is trifurcated into permanent positions, permanent posts where the incumbent feels unable to take up all their benefits (like USS membership) and the precariat.

… and among the highest contributions …

In terms of the USS, this is a double whammy as it hits the excluded members of staff and the finances of the scheme. When you combine the USS’s high drop-out rate with the big increase in deferred members (who are no longer paying in but are not yet claiming their pension either), then the level of contributions necessary to fill in the USS deficit remains shocking but does at least become more explicable.

Quite simply, there are fewer active members whose employee and employer contributions are together expected to cover their own benefits and to fill in any deficit than there are deferred members and pensioners. Only 45% of USS members actively contribute to the USS for there are 205,000 active members, 180,000 deferred members and 75,000 retired members.

…. and unusual administrative arrangements.

One of my main sources for the HEPI report was a history of the origins of the USS written by Douglas Logan, the man who did the most to set the scheme up. (His book is more interesting than you might expect too.) The history matters because the problems the USS faces today are largely, though not entirely, a result of how it was established. In short, despite the self-congratulatory tone of Logan’s book, hindsight shows that – in key respects – the establishment of the USS and its early operation are a lesson in how not to set up a new pension scheme.

Some of the decisions should probably have been seen as errors even at the time but others came to look like errors only as the regulation of defined benefit pension schemes changed over time, adding huge costs and reducing important flexibilities that operated as important safety valves for scrupulous employers (but also as ways to cheat people out of pension entitlements – effectively, deferred pay – for less scrupulous employers).

1. Governance

When the USS was founded, the AUT (the forerunner of the UCU) demanded equal representation with the CVCP (the forerunner of UUK) on the USS management committee. Yet as not all USS members were in the AUT, as the employers were set to make much larger contributions than the employees and as the employers accepted the risk of higher future contributions, this was deemed inappropriate.

But the AUT’s lobbying did lead to a Joint Negotiating Committee (JNC), which ‘approves amendments to the rules proposed by the trustee, [and] can itself initiate or consider alterations to the rules’. The JNC had five CVCP (now UUK) and five AUT (now UCU) representatives, plus an independent chair. As a result, the USS ceded significant power to one trades union and what is sometimes described as ‘the vice-chancellors’ club’ as well as to the independent chair, who must resolve the deadlock when the two sides disagree.

Relative to other occupational pension schemes, where employers have more sway, the operation of the USS is messy and conservative. My history of the USS noted that sometimes this had been helpful – I described the positioning of the AUT / UCU on some major issues as ‘prescient’: ‘On issues like protecting the value of pensions through increases after retirement, the union position shifted from being out-of-the-ordinary to mainstream (and even statutory).’

Yet it remains true that, given the burden of contributions lands on employers when their voice is comparatively weak, it has been challenging to drive through the sort of reforms than many people have thought were necessary to bring pension entitlements more in line with those elsewhere in the labour market (including among other employers with charitable status).

2. Contributions

When the USS began, contributions were set at 12% for employers and 6.25% for employees. Over time, the former bounced around more than the latter, as the employers had perhaps unwisely committed to paying for any increases in costs. By 1983, the contribution of employers had shot up by more than half to 18.55% but that of employees was essentially unchanged at 6.35%. However, from 2011, a default ‘cap and share’ rule meant employers would, where necessary, cover only 65% of any future extra increases in cost.

By 2019, employees were paying 8% and employers 18%. Today, the contributions are 21.1% for employers and 9.6% from employees (with further increases planned to 23.7% and 11% respectively). Now, very much higher contribution rates have been mooted, even up to 67.9% of payroll (and the lowest figure is still a staggering 40.8%).

image.jpeg?resize=902%2C218&ssl=1

While such contribution levels – which could effectively mean a doubling in employer contributions to over 45% and employee contributions to nearly 23% – are theoretically possible, they are not really plausible if we want to retain a successful higher education sector that seeks a careful balance in the use of its income.

Across the UK, the average employer pension contribution is reported to be 4.5%. University staff count as private sector workers, because universities are independent and autonomous, and over half of private sector staff in a workplace pension receive employer contributions of under 4%. Meanwhile, less than 3% of private sector employees with workplace pensions across the UK enjoy employer contributions at the level offered by the USS, of 20% and over. In part, this reflects the mass closure of defined benefit pension arrangements like the USS, as they tend to have higher contribution levels.

image-1.png?resize=728%2C618&ssl=1

3. Structure

The USS is a last-man-standing scheme, described on one pension website as ‘a multi-employer’ scheme in which ‘the liabilities … pass to the last employer in the scheme where the other employers have ceased to participate or become insolvent.’ This was not inevitable, for it is possible to run a multi-employer scheme in which each employer has their own segregated portion.

A last-man standing scheme does not stop a solvent employer from leaving, as Trinity College, Cambridge, controversially did recently. But this route is not feasible for many: Trinity not only has deep pockets but also had ‘fewer than 20 full-time permanent members of academic staff solely employed by the College in the scheme’. If other employers in a strong financial position were to leave, it would weaken confidence in the USS itself because those that would be left supporting the scheme would be – collectively – less strong than previously. In sort, it would undermine the mutuality that has always underpinned the USS.

The challenge is that the USS was established when there was a deeper sense of the UK having a single higher education system than there is today. Back in 1975, there were far fewer universities, the recent trends towards devolution had not happened and the so-called ‘marketisation’ of higher education, which encourages institutions to compete against one another, was (arguably) still decades away.

Conclusion

Each one of these three factors – the governance, contribution and structural arrangements – can perhaps be defended individually. Together, they have produced a situation where employers are being expected to pay more than they can reasonably afford while employees are paying so much that many potential members feel they must opt out. Some people think bolder investment strategies offer a way out. Even if they do, the Pensions Regulator is sitting in the wings waiting to pounce on behaviour it regards as inappropriately risky.

Overall, the way the USS was established means there is a certain inevitability to today’s problems thanks to the operation of path dependency, where earlier decisions determine later decisions. Some of the heat and anger in recent industrial action over university pensions do not, perhaps, sufficiently reflect that fact. But path dependency is not the same as inevitability and, at some point soon after the pandemic, the USS arrangements will need to be fully reconsidered once more.

In short, despite the controversy and opposition that it will cause, one possible change to the higher education sector caused by COVID-19 could be a reshaping of the higher sector’s pension arrangements, starting at our older institutions that still dominate the USS.

Edited by sancho panza
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48 minutes ago, sancho panza said:

I thought we had one but after 20 minutes searching....

 

Aspects of this are covered in the thread below but it's wide ranging and doesn't purely focus on the finances so this new thread is useful.

 

 

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1 hour ago, sancho panza said:

this is worth a read,I think it was psoted into public epnsions thread

USS looks like a ponzi as younger academics appear to be dropping out for a variety of reasons undermining future solvency

https://www.hepi.ac.uk/2020/11/24/why-the-pandemic-is-likely-to-produce-a-shift-in-academics-pension-arrangements/

Why the pandemic is likely to produce a shift in academics’ pension arrangements

  • 24 November 2020
  • By Nick Hillman

The largest private sector pension scheme in the UK …

A couple of years ago, I spent much of the Christmas break in a Reading Room at the British Library. I was investigating the history of the Universities Superannuation Scheme (USS). It was more fun than it sounds.

The report I wrote built on the knowledge I gleaned while working for the pensions industry during the 2000s. It provided some fairly basic reminders about the USS.

For example, it emphasised that the USS is a private sector, not a public sector, pension scheme. Indeed, it is the largest private pension scheme in the UK. This matters, as its status (huge and private) makes it unlikely the Government would ever subsume the scheme, as many people seem to envisage.

(Yes, the Royal Mail Pension Plan was absorbed but the Royal Mail was being prepared for privatisation. With universities, the direction of travel would be in the opposite direction – absorption would pull autonomous universities closer to government, which would be bad for institutions that lost autonomy and bad for government that took on more debt.)

… with the largest deficit …

In my pamphlet, I noted that the USS faced the largest deficit of any pension scheme in the UK. I also pointed out that it is younger than many people suspect, having been established on April Fool’s Day 1975, nearly a decade after the high point for post-war occupational pension scheme membership in 1967. (According to the Office for National Statistics, occupational pension scheme membership doubled between 1953 and 1967 to 12.2 million, after which it fell back to 7.8 million by 2012.)

Despite its relative youthfulness and despite the fact that it has since ballooned to include 340 employers, the USS primarily covers staff (and former staff) at older universities. Staff at newer institutions typically come within the Teachers’ Pension Scheme and there are many other pension arrangements in the higher education sector too (such as the Local Government Pension Scheme, individual universities’ schemes for support staff and schemes for student unions’ sabbatical officers).

The challenges faced by the USS at the time I was working on my paper during Christmas 2018 remain but some have become worse and some have become clearer.

By far the biggest damage [to university finances] will come through its impact on the University Superannuation Scheme, not on things like whether they can keep attracting students

Paul Johnson, ifs

One thing that has become worse is the USS deficit. On one conservative measure, the deficit rose from £5.4 billion to £12.9 billion in the year to March, before the pandemic took full effect (as assets declined by £900 million and liabilities rose by £6.6 billion). Now, according to new analysis by the Institute for Fiscal Studies (IFS), ‘the effect of the pandemic on funded defined-benefit pension schemes sponsored by universities’ is the ‘most important risk to university finances arising from the COVID-19 pandemic.’ In The Times, the Director of the IFS, Paul Johnson, put it even more bluntly: ‘By far the biggest damage [to university finances] will come through its impact on the University Superannuation Scheme, not on things like whether they can keep attracting students.’

… and a high opt-out rate …

One thing that was already an issue back in 2018 but is now discussed more is the comparatively high USS opt-out rate – in recent years, between 15% and 21% of eligible new USS members have chosen not to be in the scheme. In days gone by, occupational pension schemes were deemed so valuable that paternalistic policymakers allowed them to be compulsory. Such a lack of choice did not sit well with the individualism of the 1980s so compulsion was made illegal – and just as the huge additional costs encountered by defined benefit pension schemes began to provide an incentive to drop out.

Given that the pension contribution of each active USS member unlocks a much larger pension contribution from their employer, it seems odd that anyone would refuse to join (especially now that automatic enrolment is the norm for workplace pensions). But having cash in hand now, perhaps in order to cover childcare costs or rent, can be a more urgent priority than having a greater sum gathering up for use in the distant future. (As a new graduate, I opted out of the Teachers’ Pension Scheme. It felt necessary but now it feels like I looked a gift horse in the mouth.)

As a result of such opt outs from the USS, the academic world is not bifurcated – as many people believe – into permanent positions and the precariat. It is trifurcated into permanent positions, permanent posts where the incumbent feels unable to take up all their benefits (like USS membership) and the precariat.

… and among the highest contributions …

In terms of the USS, this is a double whammy as it hits the excluded members of staff and the finances of the scheme. When you combine the USS’s high drop-out rate with the big increase in deferred members (who are no longer paying in but are not yet claiming their pension either), then the level of contributions necessary to fill in the USS deficit remains shocking but does at least become more explicable.

Quite simply, there are fewer active members whose employee and employer contributions are together expected to cover their own benefits and to fill in any deficit than there are deferred members and pensioners. Only 45% of USS members actively contribute to the USS for there are 205,000 active members, 180,000 deferred members and 75,000 retired members.

…. and unusual administrative arrangements.

One of my main sources for the HEPI report was a history of the origins of the USS written by Douglas Logan, the man who did the most to set the scheme up. (His book is more interesting than you might expect too.) The history matters because the problems the USS faces today are largely, though not entirely, a result of how it was established. In short, despite the self-congratulatory tone of Logan’s book, hindsight shows that – in key respects – the establishment of the USS and its early operation are a lesson in how not to set up a new pension scheme.

Some of the decisions should probably have been seen as errors even at the time but others came to look like errors only as the regulation of defined benefit pension schemes changed over time, adding huge costs and reducing important flexibilities that operated as important safety valves for scrupulous employers (but also as ways to cheat people out of pension entitlements – effectively, deferred pay – for less scrupulous employers).

1. Governance

When the USS was founded, the AUT (the forerunner of the UCU) demanded equal representation with the CVCP (the forerunner of UUK) on the USS management committee. Yet as not all USS members were in the AUT, as the employers were set to make much larger contributions than the employees and as the employers accepted the risk of higher future contributions, this was deemed inappropriate.

But the AUT’s lobbying did lead to a Joint Negotiating Committee (JNC), which ‘approves amendments to the rules proposed by the trustee, [and] can itself initiate or consider alterations to the rules’. The JNC had five CVCP (now UUK) and five AUT (now UCU) representatives, plus an independent chair. As a result, the USS ceded significant power to one trades union and what is sometimes described as ‘the vice-chancellors’ club’ as well as to the independent chair, who must resolve the deadlock when the two sides disagree.

Relative to other occupational pension schemes, where employers have more sway, the operation of the USS is messy and conservative. My history of the USS noted that sometimes this had been helpful – I described the positioning of the AUT / UCU on some major issues as ‘prescient’: ‘On issues like protecting the value of pensions through increases after retirement, the union position shifted from being out-of-the-ordinary to mainstream (and even statutory).’

Yet it remains true that, given the burden of contributions lands on employers when their voice is comparatively weak, it has been challenging to drive through the sort of reforms than many people have thought were necessary to bring pension entitlements more in line with those elsewhere in the labour market (including among other employers with charitable status).

2. Contributions

When the USS began, contributions were set at 12% for employers and 6.25% for employees. Over time, the former bounced around more than the latter, as the employers had perhaps unwisely committed to paying for any increases in costs. By 1983, the contribution of employers had shot up by more than half to 18.55% but that of employees was essentially unchanged at 6.35%. However, from 2011, a default ‘cap and share’ rule meant employers would, where necessary, cover only 65% of any future extra increases in cost.

By 2019, employees were paying 8% and employers 18%. Today, the contributions are 21.1% for employers and 9.6% from employees (with further increases planned to 23.7% and 11% respectively). Now, very much higher contribution rates have been mooted, even up to 67.9% of payroll (and the lowest figure is still a staggering 40.8%).

image.jpeg?resize=902%2C218&ssl=1

While such contribution levels – which could effectively mean a doubling in employer contributions to over 45% and employee contributions to nearly 23% – are theoretically possible, they are not really plausible if we want to retain a successful higher education sector that seeks a careful balance in the use of its income.

Across the UK, the average employer pension contribution is reported to be 4.5%. University staff count as private sector workers, because universities are independent and autonomous, and over half of private sector staff in a workplace pension receive employer contributions of under 4%. Meanwhile, less than 3% of private sector employees with workplace pensions across the UK enjoy employer contributions at the level offered by the USS, of 20% and over. In part, this reflects the mass closure of defined benefit pension arrangements like the USS, as they tend to have higher contribution levels.

image-1.png?resize=728%2C618&ssl=1

3. Structure

The USS is a last-man-standing scheme, described on one pension website as ‘a multi-employer’ scheme in which ‘the liabilities … pass to the last employer in the scheme where the other employers have ceased to participate or become insolvent.’ This was not inevitable, for it is possible to run a multi-employer scheme in which each employer has their own segregated portion.

A last-man standing scheme does not stop a solvent employer from leaving, as Trinity College, Cambridge, controversially did recently. But this route is not feasible for many: Trinity not only has deep pockets but also had ‘fewer than 20 full-time permanent members of academic staff solely employed by the College in the scheme’. If other employers in a strong financial position were to leave, it would weaken confidence in the USS itself because those that would be left supporting the scheme would be – collectively – less strong than previously. In sort, it would undermine the mutuality that has always underpinned the USS.

The challenge is that the USS was established when there was a deeper sense of the UK having a single higher education system than there is today. Back in 1975, there were far fewer universities, the recent trends towards devolution had not happened and the so-called ‘marketisation’ of higher education, which encourages institutions to compete against one another, was (arguably) still decades away.

Conclusion

Each one of these three factors – the governance, contribution and structural arrangements – can perhaps be defended individually. Together, they have produced a situation where employers are being expected to pay more than they can reasonably afford while employees are paying so much that many potential members feel they must opt out. Some people think bolder investment strategies offer a way out. Even if they do, the Pensions Regulator is sitting in the wings waiting to pounce on behaviour it regards as inappropriately risky.

Overall, the way the USS was established means there is a certain inevitability to today’s problems thanks to the operation of path dependency, where earlier decisions determine later decisions. Some of the heat and anger in recent industrial action over university pensions do not, perhaps, sufficiently reflect that fact. But path dependency is not the same as inevitability and, at some point soon after the pandemic, the USS arrangements will need to be fully reconsidered once more.

In short, despite the controversy and opposition that it will cause, one possible change to the higher education sector caused by COVID-19 could be a reshaping of the higher sector’s pension arrangements, starting at our older institutions that still dominate the USS.

4 years is a long time in volatile markets. 

https://www.pensionsage.com/pa/USS-funding-position-encouraging-as-surplus-hits-7-6-bn.php

The Universities Superannuation Scheme (USS) trustee has said that the scheme's funding position looks "very encouraging" ahead of the key decision points for its 2023 valuation, with the latest monitoring update revealing a £7.6bn surplus.

The update was shared alongside the latest quarterly monitoring report to the end of March 2023, the effective date of the 2023 valuation, with USS group chief executive, Bill Galvin, stating that the direction of travel for the scheme is "clear".

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This i worthy of a seperate thread.

However, it aint just HE.

See - 

 

 

In general, the panic thats occurred with private sector DB pensions has started to happen now, in he public sector.

You can see it everywhere.

The flap over Drs pay is cos while there pay might be lowish, their pension if fucking expensive - NHS is around 50% of pay.

See - 

I had a look at  USS - I found out that CovUni were briefly a member. I guess was part of strategy to attract higher performing staff from the better Unis, where are USS.

The post 92 Polys etc are all members of the Teacher Pension System - TPPS

The TPP has just swung to 28% employer 10% employee - it aint enough.

Pretty much the public is white collar and majority wimmin.

This was Gidotrs accelerated SRA -> 67.

USS has its own wiki - 

https://en.wikipedia.org/wiki/Universities_Superannuation_Scheme

Its in better states then it was during Zirp - better yields.

The people in charge of Trinity were 200% corect - 

2019 exit by Trinity College, Cambridge[edit]

On 15 March 2019, in a move that came to be dubbed 'Trexit' (an allusion to Brexit), the Council of Trinity College, Cambridge voted to withdraw the college unilaterally from USS as of 31 May 2019, replacing the USS scheme with a defined benefits scheme, to avoid the college bearing responsibility for other pensions in the UK higher education system in the event of foreclosures in the sector. The buyout reportedly cost the college £30m.[citation needed] The move prompted some Cambridge academics to boycott supervising Trinity College students,[25][26][27][28] with over 450 Cambridge academics pledging to withdraw all labour from the college by 19 June.[29] Cambridge University's graduate student union supported the boycott, discouraging postgraduate students from taking up teaching for Trinity.[30] The General Secretary elect of UCU, Jo Grady, published an open letter calling on the college's fellows to change their course, arguing that to do so was in their interest and the interest of the USS pension scheme generally.[31][32]

On 21 June 2019, Trinity's fellows voted by 73 votes to 46 to leave USS. In October "several" fellows, including the historian Alexandra Walsham, resigned their fellowships.[33] Reportedly 550 Cambridge staff opted out of discretionary work with Trinity, and Trinity students began to report difficulty finding supervisors. Protests were staged at the inauguration of Trinity's new master, Sally Davies. The University and College Union considered a boycott.[30][34] In February 2020, Arundhati Roy had cancelled her Clark Lecture in English literature at the request of Cambridge UCU,[35] supplying it for publication in written form instead.[36][37][38] In the wake of Trinity's departure from the scheme, the Covenant Advisor to the USS Trustee, PwC, advised that the covenant remained strong but would now be placed on 'negative watch', with the threat that it might be downgraded to 'tending to strong' should another employer exit from the scheme.[39] By May 2021, the USS Trustee was said to have become 'inordinately concerned' with the risk that other employers might follow Trinity's lead, and this prompted the employers' organisation, Universities UK (UUK), to formulate proposals for a 20-year moratorium on departures.[8]

Basically, its like Acme Corp offering a DB pension to its employee. But having a commitment to fund short falls i nthe like of TopShop, Debenhams, <insert reamed org here>

 

The lbue ollar of LA work has been hived out - street cleaning, cooking etc etc.

Unless the pension setup changes, the same will have to happen with white collar work.

 

Heres a link to CS Aplha via the BMA 

https://www.bma.org.uk/pay-and-contracts/pensions/additional-pensions-advice/civil-service-pension-scheme-alpha-scheme

 

 

 

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31 minutes ago, Bear Hug said:

4 years is a long time in volatile markets. 

https://www.pensionsage.com/pa/USS-funding-position-encouraging-as-surplus-hits-7-6-bn.php

The Universities Superannuation Scheme (USS) trustee has said that the scheme's funding position looks "very encouraging" ahead of the key decision points for its 2023 valuation, with the latest monitoring update revealing a £7.6bn surplus.

The update was shared alongside the latest quarterly monitoring report to the end of March 2023, the effective date of the 2023 valuation, with USS group chief executive, Bill Galvin, stating that the direction of travel for the scheme is "clear".

Id love to se actuarial lfe expect info on private sector workers versus public sector.

NHS, etahing, Unis are full of very well rested white collar workers, wholl average a life expectancy touching 90.

 

 

 

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29 minutes ago, Bear Hug said:

4 years is a long time in volatile markets. 

https://www.pensionsage.com/pa/USS-funding-position-encouraging-as-surplus-hits-7-6-bn.php

The Universities Superannuation Scheme (USS) trustee has said that the scheme's funding position looks "very encouraging" ahead of the key decision points for its 2023 valuation, with the latest monitoring update revealing a £7.6bn surplus.

The update was shared alongside the latest quarterly monitoring report to the end of March 2023, the effective date of the 2023 valuation, with USS group chief executive, Bill Galvin, stating that the direction of travel for the scheme is "clear".

Im not saying it's currently insolvent but the direction of travel is clear if less people are joining

Also,what happens if a Uni goes under is that the liabilities pass to the remaining Uni's as per the article above.

taking the value of 2023 payouts £2,169,000,000 ) and dividing by the number of current retirees (84,000) you get an average pension of £25,000 per current pensioner

admittedly,liabilities to current member and deferred members will be lwoer,but ultimately if the average pot is £138,000,then how long will it last when Unis start going under and passing their liabilities onto the remaining unis?

https://www.uss.co.uk/-/media/project/ussmainsite/files/about-us/report-and-accounts/uss-report-and-accounts-2023.pdf?rev=ecbc7081dd6349db822cfdcba18d5769&hash=51D4A97031C768D8761D3C1D778BEF4D

Page 2-My comment.Assets/members =£138,000

image.png.bb43a49a1bc99e64185fde22ec7bfdc7.png

page 6.-MC-assets down likely due to bond markets taking a beating.Assets down from £89bn to £73bn

image.png.7513f7f2b4fe46ade48dc434967854d8.png

page 16 membership details-216,000 paying in,81,000 taking out,220,000 waiting to tkae out

image.png.752fa437f535b9c34f8e35c220a6836d.png

image.png.e13a0c626d1f35f910c2a389f7f52e9e.png

image.png.7ac7a67014b91064ebb3a6c5813381f7.png

page 64-MC-there is a surplus on contributions in,monies out but there's 440,000 o the USS membership yet to draw their pension

image.png.ef21e6ff26f814f33ac56a861b7907c6.png

page 64-MC confirming drop in asset values

image.png.772f559e95b6fa2fccc147b2f31232b2.png

 

page 66

image.png.bbbf7575a0e421b56bfae62db82fca16.png

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32 minutes ago, spygirl said:

This i worthy of a seperate thread.

However, it aint just HE.

See - 

 

 

In general, the panic thats occurred with private sector DB pensions has started to happen now, in he public sector.

You can see it everywhere.

The flap over Drs pay is cos while there pay might be lowish, their pension if fucking expensive - NHS is around 50% of pay.

See - 

I had a look at  USS - I found out that CovUni were briefly a member. I guess was part of strategy to attract higher performing staff from the better Unis, where are USS.

The post 92 Polys etc are all members of the Teacher Pension System - TPPS

The TPP has just swung to 28% employer 10% employee - it aint enough.

Pretty much the public is white collar and majority wimmin.

This was Gidotrs accelerated SRA -> 67.

USS has its own wiki - 

https://en.wikipedia.org/wiki/Universities_Superannuation_Scheme

Its in better states then it was during Zirp - better yields.

The people in charge of Trinity were 200% corect - 

2019 exit by Trinity College, Cambridge[edit]

On 15 March 2019, in a move that came to be dubbed 'Trexit' (an allusion to Brexit), the Council of Trinity College, Cambridge voted to withdraw the college unilaterally from USS as of 31 May 2019, replacing the USS scheme with a defined benefits scheme, to avoid the college bearing responsibility for other pensions in the UK higher education system in the event of foreclosures in the sector. The buyout reportedly cost the college £30m.[citation needed] The move prompted some Cambridge academics to boycott supervising Trinity College students,[25][26][27][28] with over 450 Cambridge academics pledging to withdraw all labour from the college by 19 June.[29] Cambridge University's graduate student union supported the boycott, discouraging postgraduate students from taking up teaching for Trinity.[30] The General Secretary elect of UCU, Jo Grady, published an open letter calling on the college's fellows to change their course, arguing that to do so was in their interest and the interest of the USS pension scheme generally.[31][32]

On 21 June 2019, Trinity's fellows voted by 73 votes to 46 to leave USS. In October "several" fellows, including the historian Alexandra Walsham, resigned their fellowships.[33] Reportedly 550 Cambridge staff opted out of discretionary work with Trinity, and Trinity students began to report difficulty finding supervisors. Protests were staged at the inauguration of Trinity's new master, Sally Davies. The University and College Union considered a boycott.[30][34] In February 2020, Arundhati Roy had cancelled her Clark Lecture in English literature at the request of Cambridge UCU,[35] supplying it for publication in written form instead.[36][37][38] In the wake of Trinity's departure from the scheme, the Covenant Advisor to the USS Trustee, PwC, advised that the covenant remained strong but would now be placed on 'negative watch', with the threat that it might be downgraded to 'tending to strong' should another employer exit from the scheme.[39] By May 2021, the USS Trustee was said to have become 'inordinately concerned' with the risk that other employers might follow Trinity's lead, and this prompted the employers' organisation, Universities UK (UUK), to formulate proposals for a 20-year moratorium on departures.[8]

Basically, its like Acme Corp offering a DB pension to its employee. But having a commitment to fund short falls i nthe like of TopShop, Debenhams, <insert reamed org here>

 

The lbue ollar of LA work has been hived out - street cleaning, cooking etc etc.

Unless the pension setup changes, the same will have to happen with white collar work.

 

Heres a link to CS Aplha via the BMA 

https://www.bma.org.uk/pay-and-contracts/pensions/additional-pensions-advice/civil-service-pension-scheme-alpha-scheme

 

 

 

I think Iwe dicsussed UUS on that thread but the main reason im psoting on here is becuase it's a contributory factor.once one uni goes under it prertty much forces those pension costs onto others.

if that ahppens at the same time as less studetn s borrow £50k for -(insert sh1t degree)- then the bankruptcies could occur more quickly.

I will have a look at leicester Uni.when I get time.from memory they were sailing close to the wind 4/5 years ago

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Yadda yadda yadda
35 minutes ago, spygirl said:

Id love to se actuarial lfe expect info on private sector workers versus public sector.

NHS, etahing, Unis are full of very well rested white collar workers, wholl average a life expectancy touching 90.

 

 

 

Very good point. Are there more women too?

Looking at the figures above it is no surprise that new staff members are opting out of the University scheme. It may be very generous but not many young people can either afford or have the inclination to contribute 10% + of their wages to a pension. Especially if they're paying a student loan as well as tax and rent.

Do people need to save so much for their retirement? If they don't own their own home and thus have to pay rent at retirement then yes, otherwise no. I suspect many newer employees would be happy with smaller pension contributions as they would be better able to afford their share. As they get older they can make additional private provision if they want.

Edited by Yadda yadda yadda
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27 minutes ago, Yadda yadda yadda said:

Very good point. Are there more women too?

Looking at the figures above it is no surprise that new staff members are opting out of the University scheme. It may be very generous but not many young people can either afford or have the inclination to contribute 10% + of their wages to a pension. Especially if they're paying a student loan as well as tax and rent.

Do people need to save so much for their retirement? If they don't own their own home and thus have to pay rent at retirement then yes, otherwise no. I suspect many newer employees would be happy with smaller pension contributions as they would be better able to afford their share. As they get older they can make additional private provision if they want.

The public sector is totallysutffed with wimmin

The biggies are teachers (wimmin) and NHS (nurses)

 

 

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The whole visa stuff has to be seen in party political terms. The Tories are eagerly shitting the bed ready for Labour to have to lie in it. Labour will inherit a collapsing university sector and associated pension schemes, and be forced to either hose it down with taxpayer cash or reopen the student-visa floodgates. Five years of carping from the opposition benches and moron voters might actually forget the last five years, and buy into Tory talk of them being and alternative to Labour's open borders.

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25 minutes ago, sancho panza said:

Also,what happens if a Uni goes under is that the liabilities pass to the remaining Uni's as per the article above.

Most of the unis at the bottom end, will be the bums on seats post '92s, whose staff are mostly in the TPS and LGPS. I'd expect most of the closures to happen to them.

It's funny though, that the sector has been so badly managed for the last 15 years or so that I wouldn't be surprised to see a Russell group uni go.

For example, Cardiff university built an entirely unnecessary college structure in between the schools and the management, that just sits there soaking up money, and then spent a fortune on a load of new buildings, including a hugely expensive "centre for student life" which had no clear business case, as it doesn't generate any material revenue.

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34 minutes ago, sancho panza said:

I think Iwe dicsussed UUS on that thread but the main reason im psoting on here is becuase it's a contributory factor.once one uni goes under it prertty much forces those pension costs onto others.

if that ahppens at the same time as less studetn s borrow £50k for -(insert sh1t degree)- then the bankruptcies could occur more quickly.

I will have a look at leicester Uni.when I get time.from memory they were sailing close to the wind 4/5 years ago

Yep - for the USS. Tnats why Trinity - the Trinity trustees  or whatever ye olde term is used - looked at the USS, looked at the state of the other Unis, looked at Zirp, looked at the liabilities, and thought - Fuck It.

Cheapest 30m anyone will ever spend.

 

https://www.mjr19.org.uk/cambridge/USS/Trinity.html

It weakens the USS

BS. Not having proper funding fucks USS.

It shows a lamentable lack of solidarity

The people in charge of Trinity will be *LEGALLY* obliged to protect the college.

Pensions are not solidarity, They are funding.

Stupid Marxist cunt.

 

 

 

However .. the most likely to fail are the post 92 - Ploys, Fe colleges, that crap.

These are in the TPS.

 

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13 minutes ago, SpectrumFX said:

Most of the unis at the bottom end, will be the bums on seats post '92s, whose staff are mostly in the TPS and LGPS. I'd expect most of the closures to happen to them.

It's funny though, that the sector has been so badly managed for the last 15 years or so that I wouldn't be surprised to see a Russell group uni go.

For example, Cardiff university built an entirely unnecessary college structure in between the schools and the management, that just sits there soaking up money, and then spent a fortune on a load of new buildings, including a hugely expensive "centre for student life" which had no clear business case, as it doesn't generate any material revenue.

Which posted said - There no such thing as HE management.

Hes correct.

 

 

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52 minutes ago, sancho panza said:

Im not saying it's currently insolvent but the direction of travel is clear if less people are joining

Also,what happens if a Uni goes under is that the liabilities pass to the remaining Uni's as per the article above.

taking the value of 2023 payouts £2,169,000,000 ) and dividing by the number of current retirees (84,000) you get an average pension of £25,000 per current pensioner

admittedly,liabilities to current member and deferred members will be lwoer,but ultimately if the average pot is £138,000,then how long will it last when Unis start going under and passing their liabilities onto the remaining unis?

https://www.uss.co.uk/-/media/project/ussmainsite/files/about-us/report-and-accounts/uss-report-and-accounts-2023.pdf?rev=ecbc7081dd6349db822cfdcba18d5769&hash=51D4A97031C768D8761D3C1D778BEF4D

Page 2-My comment.Assets/members =£138,000

image.png.bb43a49a1bc99e64185fde22ec7bfdc7.png

page 6.-MC-assets down likely due to bond markets taking a beating.Assets down from £89bn to £73bn

image.png.7513f7f2b4fe46ade48dc434967854d8.png

page 16 membership details-216,000 paying in,81,000 taking out,220,000 waiting to tkae out

image.png.752fa437f535b9c34f8e35c220a6836d.png

image.png.e13a0c626d1f35f910c2a389f7f52e9e.png

image.png.7ac7a67014b91064ebb3a6c5813381f7.png

page 64-MC-there is a surplus on contributions in,monies out but there's 440,000 o the USS membership yet to draw their pension

image.png.ef21e6ff26f814f33ac56a861b7907c6.png

page 64-MC confirming drop in asset values

image.png.772f559e95b6fa2fccc147b2f31232b2.png

 

page 66

image.png.bbbf7575a0e421b56bfae62db82fca16.png

Pension liabilities could have dropped too, even more than assets. Buyout market is still very active, funding levels are high at current interest rates and higher mortality. Not seen numbers for uss, just in general. 

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leicester uni a walk through their 2023 annuals.

Whats intersting?

1) value of annual pension top up £7.5mn

2) total assets circa £500mn, net assets £87mn which i think is poor given that likely includes them overvaluing their substantial real estate assets

3) involved in a £150mn scheme to build uni bedrooms which looks equity based with private sector partners.

4) around pag 75,details on income from accomodation/premisses comes in at £25mn but outgoings £30mn

5) staff costs are substantial £200mn,incoming fees from studetns are £180mn with £120mn in grant incoem

6) interesting to note that the UNi thinks fees which were set at £9k in 2012 are now worth only £6k adjsuting for RPI of 50% over the period.

7) loan coupons are cheap with some big £20mn loans going out to 2049 at 3.25%

https://le.ac.uk/-/media/uol/docs/about-us/publications/financial-statements/financial-statements-2223.pdf

page 33

 

image.png.5c22264c10361e6bf3229f54a225a0ff.png

image.png.5ed5f52788289486ff4daad2d7067e77.png

#image.png.110b416ca971b205eb2e924faafbb78e.png

image.png.bc91e0d4eeb1a72bfb041692557e80b4.png

image.png.8299a1059a744a19ad3f55d18af6a5a1.png

 

page 36-interesting highlighting riseing costs and immigration and have built all the accomodation pcitured in the last 5 years

image.png.fcc666e03d57348bfb4e617c61532f85.png

image.png.655975c5feb90f751cb84a009699b587.png

image.png.4ec24cd2f0f88948116a97f2a24ce61c.png

found the following on page 72 this is the Freemens project a £150mn build out

image.png.07f67b03c85da2e7b31f47c3bdc71ba5.png

image.png.401b8e4f141c812f016dfc943f28606c.png

 

page 59

image.png.cf374a74392d314a816023d5d363308b.png

image.png.c81b15af7572029f20a2b070054a87eb.png

 

page 60-interesting that net assets =£87mn on a balance sheet of £500mn.

image.png.b9a271ca17b30396df1a3c1cd495e9a8.png

image.png.0b754e4eefc50890ea4fcb9fff673752.png

page 63

image.png.77a4583b1c745feb8b7c69b1c2babdc4.png

image.png.55c69c17119e2e9dff63c606c6a29591.png

image.png.53b877f428faa44503273ba21d1d7cb0.png

 

page 64

image.png.c04ff3df9cf6061bf6866efbe4748c67.png

 

page 69

image.png.8454cacfdec13d36eca1b04f19a6330e.png

page 76.details on loans,substantial but at good rates for teh further out stuff.

image.png.c7343b866e4ef1a3670194bc538b7f8d.png

image.png.428d945331497bdbabdb19fee6bd8add.png

 

page 77 details on the USS pension deficit recovery costing £7mn per annum.Assets of scheme at 2020 valuation were £66bn and estimated need was £80.6bn

image.png.cc175d7f39b4578644d71ddcf2a117d2.png

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3 hours ago, Yadda yadda yadda said:

Very good point. Are there more women too?

Looking at the figures above it is no surprise that new staff members are opting out of the University scheme. It may be very generous but not many young people can either afford or have the inclination to contribute 10% + of their wages to a pension. Especially if they're paying a student loan as well as tax and rent.

Do people need to save so much for their retirement? If they don't own their own home and this have to pay rent at retirement then yes, otherwise no. I suspect many newer employees would be happy with smaller pension contributions as they would be better able to afford their share. As they get older they can make additional private provision if they want.

i did some calcs for a friend who works at a Uni based on him being offered £16k er annum at 68.Ave age death 79 fr males.I workd out hed pay in something like £400k between him and uni from 32 to 68, but then hed collect circa £192k in pension if he didnt die early.

I did the calcs jsut putting it in a FTSE tracker witout taking up the Uni contribution and it paid him more over time and then he could leave it his kids.

That USS pension looks fubar to me.

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11 minutes ago, sancho panza said:

i did some calcs for a friend who works at a Uni based on him being offered £16k er annum at 68.Ave age death 79 fr males.I workd out hed pay in something like £400k between him and uni from 32 to 68, but then hed collect circa £192k in pension if he didnt die early.

I did the calcs jsut putting it in a FTSE tracker witout taking up the Uni contribution and it paid him more over time and then he could leave it his kids.

That USS pension looks fubar to me.

But if he withdrew from the pension, I don’t think he would get the employer contribution to put elsewhere. I may be wrong on that though. 

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2 hours ago, Axeman123 said:

The whole visa stuff has to be seen in party political terms. The Tories are eagerly shitting the bed ready for Labour to have to lie in it. Labour will inherit a collapsing university sector and associated pension schemes, and be forced to either hose it down with taxpayer cash or reopen the student-visa floodgates. Five years of carping from the opposition benches and moron voters might actually forget the last five years, and buy into Tory talk of them being and alternative to Labour's open borders.

FOr a lot of studetns bringing kids,there's a one off hit from them bringing moeny in but children in schools/NHS needs/child tax credits etc and the UK prob loses on average (substantially so msot likely)

Agree on second bit,labour being handed the dog poo sandwich straight out of the mcirowave

 

2 hours ago, SpectrumFX said:

For example, Cardiff university built an entirely unnecessary college structure in between the schools and the management, that just sits there soaking up money, and then spent a fortune on a load of new buildings, including a hugely expensive "centre for student life" which had no clear business case, as it doesn't generate any material revenue.

fascinating insight FX thank you.

Ive psoted up on a leicester uni £150mn project and fromwhat I cant tell on the income statement their accomodation/hotel business is down £6mn a year on £25mn turnover.Obviously,there may be cross over costs but still.

Coventry uni have spent a fortune on their campus.

At elast leciester is russel group

2 hours ago, spygirl said:

 

However .. the most likely to fail are the post 92 - Ploys, Fe colleges, that crap.

These are in the TPS.

 

theres two aspects to the looming curnch,part is pensions and part what @SpectrumFX allusdes to is the property and teaching sides of the business.

leicester uni as shown has a huge wage bill and is very relaint on grant and studetn numbers as youd expect I guess but given the other issues eg lack of flex in balance sheet and constant topping up of USS at £7mn p.a.,then leicester might survive but I susect more marginal players eg cumbria will lose first.

I mean where would you rather go leicester UNi or one noones heard of?

2 hours ago, Bear Hug said:

Pension liabilities could have dropped too, even more than assets. Buyout market is still very active, funding levels are high at current interest rates and higher mortality. Not seen numbers for uss, just in general. 

no the data is clear and Ive psoted it upthread.there's roughly 520k member sof the USS,220k defered and 80k claiming.

of the expenditue ave pension is £25k p.a. and given ave assets per member is £138k it's massively underfunded.

also nore from uss data that total assets dropped £16bn iirc to £66bn in 2023 from 2022.that ebcause they were heavy buyers of 1% gilts and the like 2010 on.

it's a disaster waiting to happen imho.

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1 minute ago, One percent said:

But if he withdrew from the pension, I don’t think he would get the employer contribution to put elsewhere. I may be wrong on that though. 

thats the alarming thing OP

He wouldn't get the employer contribution but from the maths it was close asto whether he'd be better off.

here it is and pelase remember these are rough figures

.he pays in £4k so they pay in £9k

after 30 years his pot should be £390k.they then promise to pay him circa £16k to £18kiirc until he dies.wife then gets half.so if he lives to 80 then even at £18k he gets £216k back.

if he invest his £4k himslef an gets a 5% retunr then over 30 years he'll have a pot of £249k.if he returns 6% then he gets £290k givning him an income of £17k per annum but and this is crucial,the moeny is his and can be left to his kids.

I'm likely missing something but that extra cash is getting paid out to current pensioners

https://www.uss.co.uk/for-members/your-pension-explained/what-you-pay-and-what-youll-get

  • You pay in 6.1% of your salary each month.
  • You get tax relief on your contributions, so some of the money that you normally pay towards tax goes into your pension instead.
  • Your employer pays in 14.5% of your salary each month towards your benefits and running USS.

What you get

 

A guaranteed retirement income from the Retirement Income Builder, the defined benefit part

  • Every year, you’ll build a block of pension based on an accrual rate (1/75 of your salary, up to the salary threshold).
  • You’ll also get a one-off cash lump sum (tax-free up to a certain limit) of three times your pension amount to take at retirement.

A flexible savings pot with the Investment Builder, the defined contribution part

  • You and your employer will add to this (as well as the Retirement Income Builder) if you earn above the salary threshold.
  • You can choose to make additional contributions to this part to save more – even if you don’t earn above the salary threshold.
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9 minutes ago, sancho panza said:

thats the alarming thing OP

He wouldn't get the employer contribution but from the maths it was close asto whether he'd be better off.

here it is and pelase remember these are rough figures

.he pays in £4k so they pay in £9k

after 30 years his pot should be £390k.they then promise to pay him circa £16k to £18kiirc until he dies.wife then gets half.so if he lives to 80 then even at £18k he gets £216k back.

if he invest his £4k himslef an gets a 5% retunr then over 30 years he'll have a pot of £249k.if he returns 6% then he gets £290k givning him an income of £17k per annum but and this is crucial,the moeny is his and can be left to his kids.

I'm likely missing something but that extra cash is getting paid out to current pensioners

https://www.uss.co.uk/for-members/your-pension-explained/what-you-pay-and-what-youll-get

  • You pay in 6.1% of your salary each month.
  • You get tax relief on your contributions, so some of the money that you normally pay towards tax goes into your pension instead.
  • Your employer pays in 14.5% of your salary each month towards your benefits and running USS.

What you get

 

A guaranteed retirement income from the Retirement Income Builder, the defined benefit part

  • Every year, you’ll build a block of pension based on an accrual rate (1/75 of your salary, up to the salary threshold).
  • You’ll also get a one-off cash lump sum (tax-free up to a certain limit) of three times your pension amount to take at retirement.

A flexible savings pot with the Investment Builder, the defined contribution part

  • You and your employer will add to this (as well as the Retirement Income Builder) if you earn above the salary threshold.
  • You can choose to make additional contributions to this part to save more – even if you don’t earn above the salary threshold.

Thanks for taking the time, appreciated 

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3 hours ago, SpectrumFX said:

I wouldn't be surprised to see a Russell group uni go.

In the link above which documents current staff cutbacks and other measures, Exeter seemed to be the only Russel group uni to feature at the moment.

I visited there about 8 or 9 years ago, and the place was packed full of new and completely soulless buildings.

Since they seemed to care only about money, I suggested as a joke to the academic I was visiting that they should introduce a night shift to cater to their Australian students. There was a pause of about 2 seconds during which I think he was considering whether to suggest this seriosly to his head of department.

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7 minutes ago, dnb24 said:

The fundamental issue is that there's massive overcapacity in the sector.

They need a bunch of the worst run places to go bust, and the government to stand back and let them fail. That needs to keep happening until there's enough students to go around the remaining universities.

That won't happen though. The government love to meddle, and the sector is full of entitled whiners who have their ear.

Edited by SpectrumFX
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Just now, SpectrumFX said:

The fundamental issue is that there's massive overcapacity in the sector.

They need a bunch of the worst run places to go bust, and the government to stand back and let them fail. That needs to happen until there's enough students to go around the remaining universities.

That won't happen though. The government love to meddle, and the sector is full of entitled whiners who have their ear.

That’s because they absolutely arse raped vocational education to enable a mass expansion of non-degrees so as to saddle young people with massive debt.  

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