UCU fights and wins on an extension to USS early retirement factor change

The UCU Superannuation Working Group (SWG) have been engaged with USS since January 2024 regarding proposed changes to the Early Retirement Factors from 01 April 2024. Early Retirement Factors are the percentage reduction applied to a member’s pension if they retire before their Normal Pension Age (NPA). The further you are from NPA, the larger the reduction.

However, changes proposed from 01 April 2024, if implemented, would have meant a significant difference in pension entitlement between members retiring on 31 March 2024 and from 01 April 2024 onwards. Along with UUK, the SWG Negotiators met USS on a number of occasions to seek a delay to the implementation date. As per this linked USS communication, this change has now been delayed to 01 October 2024.

This delay is very much welcome and will give members considering Early Retirement the time to look at the finances of such a decision, engage their families, engage employers, and take independent financial advice. But 6-months is not long.

Given this, UCU would advise any member who is considering seeking early retirement in the next 12/18 months to take steps immediately to assess their options. It may well be that remaining in employment is the best option, but members should seriously consider all options now.

Financial Information can be obtained from Annual Pension Statements and the MyUSS portal on the USS website. We would encourage members considering early retirement to speak with family and employers now. For those members who see Early Retirement as a real option before 01 October 2024, we would suggest that members engage USS for necessary financial information before seeking independent financial advice. Members should note that UCU has a partnership arrangement with Quilter Financial – UCU – Financial advice from Quilter Financial Advisers – who may be able to assist.

While SWG are unable to stop the changes to Early Retirement Factors, this delay is significant as it provides members the time needed to consider all options and take advice. And while they will be continuing to meet USS on Early Retirement Factors going forward, they urge members considering Early Retirement to use this time well.

Planned changes to early retirement benefits in your USS Pension

We have recently learned of changes to your USS pension related to early retirement, which USS plans to make on 1^st April 2024. It is important you understand that if you are considering early retirement, the planned changes to Scheme Factors, if they go ahead, could seriously disadvantage you.

We believe it would be prudent for members considering early retirement to urgently:

Write to USS seeking the necessary financial information to inform their decision, asking for calculations for dates before and after 1st April 2024.
Make contact with HR to ensure the necessary work is completed so as not to delay any decision with USS. This contact from staff enables HR to notify USS and provide confirmation of notice period.
Seek independent financial advice to inform their decision-making. Members may wish to use the free service for UCU members provided by Quilter Financial UCU – Financial advice from Quilter

We are reliably informed that the UCU Pensions Negotiators are fighting this change, which was not part of the recent USS negotiations outcome. Nevertheless, at this point in time the change is planned for implementation on 1^st April and as the date is drawing near, we wanted to draw your attention to it.