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USS Employer Pension Contribution – Impact on Research Projects

6 June 2019

USS Employer Pension Contributions increased from 1 April 2019 and further increases (from the 2017 valuation) are proposed for October 2019 and April 2020, subject to the outcomes of the 2018 valuation and consultation. 

USS image

Impact on awards (costed using the old USS rates)

In accordance with usual practice, UCL’s main funders have stated they will not provide supplement budgets to meet the increased USS costs for projects applied for (and awarded) using the old rates. As such it is important to recognise that staff expenditure will need to be managed within the original budget. The financial impact on individual research awards is difficult to forecast as this will depend on the project’s directly charged staff composition, time left to run etc. Options that may be available (subject to terms and conditions of funding) include:

  • Reduce the length of new appointments / extensions (however this is not an option for certain funding e.g. Fellowships)
  • Transfer budget from other headings within the award (e.g. consumables) to the staff budget.
  • Meet the shortfall from alternative funding sources. 
  • It is recognised that in some cases, there will be little option to mitigate the impact of the increased contributions, in these cases the deficit will need to be met locally. 

Please note whilst Research Services (Post Award) will adopt the increased rates when forecasting the costs of new appointments or contract changes (as part of the RS approval process), we will not be retrospectively reviewing approved appointments or contract changes.

Impact on future awards

Further to confirmation from UKRI and the Wellcome Trust that applications should be made using the new rates (2017 Valuation), the Employer USS rates have now been updated in Worktribe (for all Funders) as per the below table. 

Effective date

Employer rate

Employee rate

Total

1 October 2019

22.5%

10.4%

32.9%

1 April 2020

24.2%

11.4%

35.6%

UKRI have suggested that if the actual USS increases implemented for October 2019 and April 2020 are lower than the 2017 valuation rates included on grant applications HEI’s may need to re-cost impacted salary budgets and potentially return a portion of the awarded budgets. It is anticipated that other Funders will adopt a similar stance. 

In this event, Research Services will provide advice and support to ensure UCL is positioned to comply with any such requirements. Please get in touch with the team if you have any questions.