Pensions plus

Pensions Plus is open to employees who are members of the Universities Superannuation Scheme (USS). It will allow members to benefit from savings in National Insurance Contributions (NIC) by changing the way pension contributions are paid.

What is Pension Plus?

Pensions Plus is not a new pension scheme, it’s simply a more effective way of making payments into your current pension.

Members of the USS Pension Scheme (Final Salary and Career Revalued Benefits Sections) will be able to participate in Pensions Plus. Your participation will be automatic unless it’ shown to have an adverse effect on your take-home pay or your entitlement to state benefits.

You’ll be informed if this applies to you. Participation is not compulsory and you can opt out.

How does it work?

You no longer pay regular pension contributions directly to the USS. Your contractual gross pay is reduced by the appropriate contribution rate due under USS rules. The University will instead make the equivalent payment into the USS Pension Scheme, in addition to the normal employer contribution.

As a result of the way contributions are made, your take-home pay will (in the majority of cases) increase because you will be paying less NIC.

This is because the salary from which the employee pension contributions were previously paid is subject to NIC, but contributions made by the University into your pension are not.

Note that under the terms of the USS, Pensions Plus applies to regular pension contributions only but does not apply to Additional Voluntary Contributions (AVCs) paid to the USS to secure additional service or fixed amount of pension, or to Prudential.

Additional regular contributions to the USS Investment Builder can be set up on a Pensions Plus basis. One off lump sum payments to the USS Investment Builder cannot be set up on a Pensions Plus basis.

Changes to terms and conditions

By participating in Pensions Plus you are agreeing to a change in your terms and conditions of employment.

It’s important you understand the changes to your contractual pay and payment of pension contributions. All other terms and conditions of your employment remain unaffected:

  • Your Pension entitlements are not adversely affected by this change.

  • The overall level of contributions going into the Scheme, and all benefits payable under the USS Pension Scheme, will remain unchanged by participation in Pension Plus.

  • There will be no reduction in your Pensionable Pay as a result of taking part as this is based on your ‘Reference Salary’, your total pensionable salary before any adjustment for Pensions Plus. .

  • Pensions Plus will not affect any other salary-related payments or benefits that you receive from the University such as salary increases and overtime, as these will all also be based on your Reference Salary.

  • Your Reference Salary will be the amount stated in any personal official letters, for example, mortgage letters, loan applications or job references.

  • Pensions Plus does not affect your income tax, as employee pension contributions already attract tax relief.

  • In the majority of cases you will pay less NIC, increasing your take-home pay.

  • All amounts shown in this information are calculated in respect of the 2015/16 tax year and are subject to future changes in line with legislation, which is typically reviewed on an annual basis with any changes normally coming into effect from 6 April each year.

Frequently Asked Questions