The University and College Union (UCU) has written to the government demanding ministers protect access to the Teachers’ Pension Scheme (TPS) for university staff, warning failure to intervene could lead to “irreparable damage”.
While post-92 universities are legally required to offer the pension to academics, a number of institutions – including Coventry, Staffordshire and Southampton Solent universities– have begun employing staff through subsidiary firms, meaning they are no longer obligedto offer the TPS.
The TPS has an employer contribution rate of 28.68 per cent, which post-92 universities claim is too high and further exacerbates their financial issues.
UCU’s general secretary Jo Grady has written to Bridget Phillipson, secretary of state for education, and Jacqui Smith, minister for skills, demanding that the government rules out any legislative changes that would allow universities to opt out of the TPS.
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Grady accused employer bodies of “aggressively” lobbying for these changes andalso said that the government must intervene to stop institutions using fire and rehire tactics to force staff out of the TPS and consider sanctioning employers for “anti-worker behaviour”.
Raj Jethwa, chief executive of the Universities and Colleges Employers Association (Ucea), said high pension costs were a“significant cause of financial distress” for universities and the body had a duty to “explore all the options available for the future and will continue to lobby for urgent change”.
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Grady added that policymakers should provide emergency financial support to help universities meet TPS contribution costs, similar to that already provided to schools and colleges.
The letter notes that in the “last week alone” Sheffield Hallam University and London South Bank University have sought to “force” staff out of the TPS, while disputes relating to pensions continue at Southampton Solent and Northumbria universities, among others.
“We need more direct government intervention in the sector than usual, but this is an exceptional moment. Failure to act will both see irreparable damage to higher education and severe weakening of TPS as a scheme, with wider fiscal ramifications,” the letter states.
“Allowing university employers to dismantle our pensions unchecked would directly contradict the government’s stated commitment to treat higher education as a public good. Continued Treasury inaction risks looking less like neutrality and more like complicity in the systematic weakening of one of the UK’s last world-leading sectors.”
Grady said that defined benefit pensions are a “vital part of employment in higher education” and the government “must act to defend them”.
“University employers are accelerating attempts to erode pension security, using the current financial crisis as cover. If ministers are serious about treating higher education as a public good, they cannot stand by while employers strip away the retirement security, and steal the deferred wages, of staff.
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“We need to see a clear government position: no opt-outs from TPS, no fire-and-rehire to cut pensions, and proper financial support to sustain the scheme. Failure to act risks lasting damage not just to universities, but to a nationally important pension scheme.”
Staff at Northumbria University have been on strike this week following a dispute over pensions, after the university announced it would offer incentives to staff on the TPS to transfer to a pension scheme with a lower employer contribution rate.
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The university claimed that the TPS was “significantly financially disadvantaging” post-92 universities.Earlier this monthɫֱreported that more than nine in 10 Northumbria staff were yet to agree to switch pensions, but the university said that expected many more to do so before the 31 May deadline.
Meanwhile, Sheffield Hallam University caused controversy after it announced that only REF-eligible academics would be able to keep their TPS pensions, in a move the union claimed would “divide” the workforce and prevent teaching-focused academics from taking on research opportunities.
Ucea’sJethwa said:“A fair and sustainable approach to pensions is urgent as HE institutions in TPS face substantial financial challenges which have been exacerbated by the extraordinary increases in employer pension contributions.
“All in the sector and beyond know that post-92 and many specialist institutions face a competitive disadvantage because of this mandated TPS participation, with employers paying TPS contributions of nearly 30 per cent. UCU must acknowledge that this is a significant cause of financial distress, increasing the risk of institutional failure and closure – as well as being expensive for staff. These issues lead UCU’s own campaigning priorities.”
“Targeting HE institutions without understanding the reasons and urgency for addressing TPS restrictions is unhelpful and unfair. Ucea has a duty to explore all the options available for the future and will continue to lobby for urgent change while UCU has not considered realistic alternatives to this beyond the recent request for financial subsidy.
“HE institutions strive to be employers of choice and this includes offering competitive pensions as part of their overall reward package.”
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