28 September 2026 
Julia Ascott, Employment taxes specialist
Welcome to our pensions newsletter, summarising key developments across higher education pension schemes and the wider pensions landscape, with a particular focus on the issues most likely to affect institutional finances, pension strategy and governance.
As we set out in the August update, the key pensions issue for the sector remains the USS 2026 valuation. Following publication of the provisional results earlier this summer, UCEA is finalising its response to USS ahead of the end of September. USS's provisional valuation reported:
The debate continues around how best to balance contribution affordability, benefit security and long-term stability. Universities will be watching closely to see whether the valuation ultimately leads to lower contribution requirements, greater investment de-risking, benefit improvements, or a combination of the three.
UCEA has announced the appointment of Ian Wilson as a UCEA-nominated non-executive director to the USS Board. The appointment comes at a significant point for the scheme as it concludes discussions on the 2026 valuation and considers its future funding and investment strategy.
The Financial Times recently examined USS's investment strategy and governance arrangements, highlighting continuing discussion around how the scheme balances investment returns, risk management and long-term affordability, with a ‘compare and contrast’ exercise for 100% gilts versus 100% equity.
The article appears to question USS's investment performance relative to growth-focused benchmarks, however, USS argues that success should be measured against its liabilities and long-term funding objectives. The discussion is particularly relevant given the scheme's reported surplus and the sector's ongoing debate about future contribution levels.
USS has published responses to three DWP consultations (see formal consultation responses within briefings and analysis), covering scale requirements, DB surplus flexibilities and the General Levy review. Across all three responses, USS argues that policy should better recognise the characteristics of large open multi-employer schemes and avoid creating unintended consequences for employers and members.
USS has published its latest Taskforce for Climate-related Financial Disclosures (TCFD) Report, highlighting climate change as a significant long-term financial risk to the scheme. USS reports that it has met its 2025 portfolio emissions target and remains ahead of its 2030 target.
Recent discussion across the LGPS has focused on the role of local investment and governance arrangements within LGPS funds. Commentary has highlighted the challenges of balancing local economic priorities with fiduciary responsibilities to scheme members.
Meanwhile, the BBC reports on UCU claims of ‘fire and rehire’ at Cumbria University to remove staff from the LGPS and put them into a DC scheme. As is often the case, the position appears more nuanced than initial headlines suggest.
Key updates include HMRC clarification that the £30,000 limit for trivial commutation lump sum death benefits applies to the combined value of any original payment and subsequent McCloud top-up payment, progress towards pensions dashboards readiness, and new member resources for Pensions Awareness Week 2026. The bulletin also highlights further guidance from PDP, PASA and TPR on dashboard compliance and data matching.
TPS has reminded members and employers that administration of the scheme will transfer from Capita to Tata Consultancy Services (TCS) on 1 November 2026. To support the transition, a number of online and support services will be temporarily unavailable between 22 October and 2 November 2026, including member and employer portals, online applications and contact services.
Members and employers are encouraged to plan ahead and complete any urgent activity before the service suspension period. The change of administrator will not affect pension benefits or entitlements.
The Government has published the findings of an independent review into the administration of the NHS Pension Scheme and announced a further independent audit of scheme administration. The review examined the delivery of the McCloud remedy following delays in meeting statutory deadlines and identified recommendations covering governance, leadership, data management, digital systems and customer experience.
Alongside the review, the Government Actuary’s Department (GAD) has been appointed to undertake a comprehensive audit after additional administration issues were identified affecting a small proportion of members. NHS Pensions is reviewing records, contacting affected members directly where required, and correcting any underpayments or errors. The majority of members are not expected to be affected.
Employers are not required to take any action at this stage but are encouraged to remind staff to keep their contact details up to date.
SAUL marked Pension Awareness Week by encouraging members to give their pension the same attention they would give to growing a garden: start early, review progress regularly and allow time for growth. The campaign forms part of the wider Pay Your Pension Some Attention initiative, which aims to encourage people to check their pension arrangements, understand their retirement savings and take practical steps to improve future financial outcomes
HMRC has begun contacting individuals entitled to receive a Low Earner's Pension Payment, which addresses differences in tax relief outcomes experienced by some members of workplace pension schemes operating under net pay arrangements.
Although primarily affecting individuals rather than employers, institutions may receive questions from staff who have been contacted by HMRC.
HMRC has published Pension Schemes Newsletter 185, covering a range of pensions tax developments and administrative updates relevant to pension scheme administrators and advisers.
Following the retirement of Carol Prokopyszyn, UCEA is seeking a new university representative to join the USS Joint Negotiating Committee (JNC).
Given the current composition of the JNC, UCEA is particularly keen to hear from candidates with a strong finance background. This presents an excellent opportunity for CFOs, Finance Directors and other senior finance leaders from USS-participating institutions to contribute to discussions on one of the sector's most significant financial issues.
UCEA launched a range of new resources aimed at helping institutions understand and address gender and wider equality pension gaps. The resources include:
The initiative reflects growing recognition that pension outcomes are closely linked to wider workforce issues such as pay, progression, flexible working and caring responsibilities.
With new research from the Pensions Policy Institute finding that women aged 55-59 hold only around 54% of the pension wealth of men of the same age, these initiatives will help address both pay and pension inequalities across the workforce.
The latest survey from the Association of Consulting Actuaries suggests that defined benefit funding positions continue to strengthen:
For universities with self-administered schemes, the findings reflect the wider shift from deficit management towards governance of funding surpluses and long-term strategy.
First Actuarial has launched a new Higher Education Pensions Governance Service designed to support institutions participating in multiple pension arrangements.
The service aims to help universities strengthen oversight of pension costs, risks and governance across schemes such as USS, TPS and LGPS, reflecting growing demand for more coordinated pension governance.
The DWP has launched its consultation on the automatic consolidation of deferred defined contribution pension pots worth less than £1,000.
The Government estimates there are over 13 million such pots in existence. While principally affecting the defined contribution market, the proposals form part of the wider pensions reform agenda and are likely to be of interest to institutions involved in pension governance.
Government research suggests that almost seven million adults remain unclear about how much State Pension they are likely to receive. The findings highlight the continued importance of financial wellbeing and pension awareness initiatives.
The Pensions Regulator has provided further insight into its evolving regulatory and enforcement strategy. The emphasis remains on identifying risks to savers while using powers proportionately, although expectations around compliance and governance remain high.
Industry data suggests that the cost of running defined benefit pension schemes has risen by approximately one-third in recent years, with larger schemes not necessarily benefiting from lower operating costs.
Universities with self-administered schemes may wish to benchmark adviser fees, governance costs and administration arrangements as part of ongoing value-for-money reviews.
Research commissioned by Nest, Border to Coast and IFM Investors found that more than four in five savers would like to know more about how their pension funds are invested in infrastructure projects.
The findings reflect a growing emphasis on member engagement and transparency regarding investment strategies, particularly as pension schemes are increasingly encouraged to invest in productive finance and UK growth assets.
For universities involved in scheme governance, the article highlights the importance of communicating not only investment performance, but also how investment decisions support wider economic and societal outcomes.
There are a number of excellent pensions newsletters available from advisers, specialists and representative bodies. We’ve set out links to these newsletters or information on how to access them below:
We are pleased to be hosting a series of pensions webinars for our members throughout the year, featuring sector-specific content and practical resources tailored to higher education institutions.
Our next (online) session is with Howdens who will be providing a session on: Pensions Under Pressure: Helping Universities Balance Cost, Risk and Talent for all BUFDG and UHR members on Thursday, 22 October at 10.00am. You can find more details and register your place here.
If you missed the session from Law Debenture and the Education Pensions Club on self-administered DB schemes, you can catch up with the recording and access the slides here.
