Thread by @JosephineCumbo

BREAKING: The giant USS pension fund has reported itself to the regulator after plunging stock markets triggered a breach a key funding measure.

Trustees will now consider whether contributions from employers and hundreds of thousands of members need to increase.

More follows

The funding measure breached by USS related to the USS's scheme's ability to pay pension promises without extra calls on employers for contributions.

A threshold for this "self sufficiency" ratio was breached for 5 consecutive business days on March 17.

This meant that the USS had to report a breach of its covenant to the Regulator and a requirement by its trustees to consider "appropriate" action in response.

This could include stepping up contributions.

Bill Galvin, group chief executive of the USS, yesterday wrote to the heads of more than 300 university employers sponsoring the scheme, to inform them of the covenant breach, and that trustees must not formally review the scheme's funding position.

The development came as the USS is due to formally value all its assets on March 31, as part of its 2020 scheme valuation.

The valuation comes as markets around the world are plunging due to the #Coronavirus.

In the email to University employers, Bill Galvin, group chief of USS, said:

"We recognise that there will be significant and understandable concerns among our sponsoring
employers and membership in general, particularly as we approach 31 March 2020".

Galvin: "Our current view is that the impact of Covid-19 will be very significant over the near-term. The impact
is more likely to be less material as we look further out."
We will not rush to judgement on how to deal with the current circumstances. We will remain vigilant."

The USS trustees will meet on March 26 to formally review the scheme's position in response to the breach, and consider "appropriate" action.

Separately, the USS is also reviewing the impact on the 2020 valuation schedule from what will likely be
"prolonged operational disruptions in institutions and for USS" due to the #Coronavirus outbreak.

USS said it does not expect the Covid-19 outbreak to impact on the payment of pensions.

However, it expects service levels to be impacted by the outbreak.

USS: "We can assure you that we have a business
continuity plan in place and have been making appropriate preparations".

The #USS Trustee Board will meet next week to consider what, if any, action should be taken over the covenant breach

"The 2020 valuation provides an opportunity to take a calm and considered approach to assessing current conditions and any changes to the long-term outlook."