Changes to USS

Every effort has been made to present accurate information. Members are advised to check with their employer and/or the USS guides to confirm their understanding before acting on any information given. This presentation may be recorded for training and audit purposes.

Presentation for USS membersColin Busby and Eifion Morris APMI

Change

• The review of USS

• Changes affecting current members

• Changes affecting new joiners

• Tax relief allowances from 2011

• Your questions

The Review of USS

Review of USS

Changes affecting current members – Final salary section

Changes affecting current members

1 October 2011

Higher Normal Pension Age (NPA)

Normal Pension Age (NPA)65Example –retiring at 60 with employer consent

Age at 30 September 2011 50Service to 30 September 2011 20 yearsService since I October 2011 10 yearsPensionable salary £45,000.00

I’m buying extra service to retire at 60

Change to redundancy terms

Normal Pension Age to be linked to rise in State Pension Ages

Future increases to NPA - 66

April 2020 NPA increases to 66

Contribution increase to 7.5%

Salary (pa) Cost from take-home pay at 6.35% (per month)

Cost from take-home pay at 7.5% (per month)

Impact on take home pay each month

£10,000 £36.00 £43.60 - £ 7.60£15,000 £50.00 £61.80 - £11.80£30,000 £94.00 £116.80 - £22.80£45,000 £139.00 £173.60 - £34.60£60,000* £190.50 £225.00 - £34.50 £75,000* £238.00 £281.00 - £43.00

* 40% tax relief applied

Pension increases change

Pension increase change

Increases to official pensions USS increase

5% pa or less Increases matched

More than 5% pa but less than 15% pa 5% plus 50% of increases above 5%

More than 15% pa Overall ceiling of 10% pa

Deferred pension increases

Flexible retirement

Flexible retirement – early payment reductions

Other changes

What stays the same?

Changes affecting new entrants from 1 October 2011

Who joins new section?

How does Career Revalued Benefits work?

Cost sharing

Cost sharing

Tax relief allowances from April 2011

Tax relief – pre April 2011

Tax relief changes – April 2011

Salary at start of year

Salary at end of year (5% increase)

Pension and lump sum accrual (19:1)

10 years 20 years 30 years 40 years

£50,000 £52,500 £14,499 £16,756 £19,012 £21,268

£60,000 £63,000 £17,399 £20,107 £22,814 £25,522

£70,000 £73,500 £20,299 £23,458 £26,617 £29,775

£80,000 £84,000 £23,199 £26,809 £30,419 £34,029

£90,000 £94,500 £26,099 £30,160 £34,221 £38,283

£100,000 £105,000 £28,999 £33,511 £38,024 £42,536

£110,000 £115,500 £31,899 £36,862 £41,826 £46,790

£120,000 £126,000 £34,799 £40,214 £45,629 £51,044

£130,000 £136,500 £37,698 £43,565 £49,431 £55,297

£140,000 £147,000 £40,598 £46,916 £53,233 £59,551

£150,000 £157,500 £43,498 £50,267 £57,036 £63,804

£160,000 £168,000 £46,398 £53,618 £60,838 £68,058

£170,000 £178,500 £49,298 £56,969 £64,640 £72,312

£180,000 £189,000 £52,198 £60,320 £68,443 £76,565

£190,000 £199,500 £55,098 £63,671 £72,245 £80,819

£200,000 £210,000 £57,998 £67,023 £76,048 £85,073

£250,000 £262,500 £72,497 £83,778 £95,059 £106,341

Salary at start of year

Salary at end of year (10% increase)

Pension and lump sum accrual (19:1)

10 years 20 years 30 years 40 years

£50,000 £55,000 £20,437 £28,631 £36,824 £45,018

£60,000 £66,000 £24,524 £34,357 £44,189 £54,022

£70,000 £77,000 £28,612 £40,083 £51,554 £63,025

£80,000 £88,000 £32,699 £45,809 £58,919 £72,029

£90,000 £99,000 £36,786 £51,535 £66,284 £81,033

£100,000 £110,000 £40,874 £57,261 £73,649 £90,036

£110,000 £121,000 £44,961 £62,987 £81,014 £99,040

£120,000 £132,000 £49,049 £68,714 £88,379 £108,044

£130,000 £143,000 £53,136 £74,440 £95,743 £117,047

£140,000 £154,000 £57,223 £80,166 £103,108 £126,051

£150,000 £165,000 £61,311 £85,892 £110,473 £135,054

£160,000 £176,000 £65,398 £91,618 £117,838 £144,058

£170,000 £187,000 £69,485 £97,344 £125,203 £153,062

£180,000 £198,000 £73,573 £103,070 £132,568 £162,065

£190,000 £209,000 £77,660 £108,796 £139,933 £171,069

£200,000 £220,000 £81,748 £114,523 £147,298 £180,073

£250,000 £275,000 £102,184 £143,153 £184,122 £225,091

Salary at start of year

Salary at end of year (Promotion)

Pension and lump sum accrual (19:1)

10 years 20 years 30 years 40 years

£15,000 £20,000 £14,444 £25,214 £35,985 £46,755

£20,000 £30,000 £27,175 £49,452 £71,730 £94,007

£36,000 £45,000 £27,540 £46,264 £64,989 £83,713

£100,000 £250,000 £373,374 £722,261 £1,071,149 £1,420,036

AVC options for Final Salary members

AVC Options

AVCs and the Annual Allowance

How to pay AVCs – Added Years

Summary of changes

More information

• Pensions office contacts

• USS website – www.uss.co.uk

• Prudential – www.pru.co.uk/uss– 0800 515914