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#USS has just circulated a pdf with "responses to questions we did not have time to cover during the webinar itself". But it doesn't include a response to the question I submitted👇. Perhaps they're still working on that one:
This from their response to Q4 is a bombshell in which #USS tries to shift some responsibility for the drive to de-risk onto @UniversitiesUK @USSEmployers 💣😯👀👇. 
I believe that #USS is referring to @UniversitiesUK @USSEmployers' failure to endorse the maximum growth in reliance on covenant as CPI+2% (general salary growth) that #USS proposed in its Feb 2017 valuation. See this blog👇.
medium.com/@mikeotsuka/uu…
medium.com/@mikeotsuka/uu…
See @Sam_Marsh101's tweet👇on my👆blog post.
Re #USS's bombshell👇in which they announce that trustees have a risk appetite of £19bn reliance on covenant rather than JEP-proposed £13bn. 1/
.@UniversitiesUK @USSEmployers & @ucu should respond as follows: This is a VERY interesting revelation. We can live w/ your rejection of 10 yr delay in de-risking & smoothing of future service, so long as you implement £19bn reliance. 2/2
Increasing reliance from £13bn to £19bn would decrease the TP deficit by about £3bn and the future service discount rate by about 2.25%.
In their answer to Q1, #USS says these four JEP proposals would increase risk👇. They also say that "adopting all of the changes proposed would fall outside the Trustee's risk appetite".1/
But, in their aforementioned bombshell, #USS says that the trustee has a risk appetite of £19bn reliance on covenant rather than JEP-proposed £13bn. 2/
The valuation #USS released in January embraces £13bn reliance plus investment outperformance in deficit recovery plan, while rejecting 10 yr delay in de-risking & smoothing of future service. 3/
If, however, reliance is increased from £13bn to £19bn, there would be no need for investment outperformance in deficit recovery plan, since the deficit would go down by £3bn (see👇), from £3.6bn to £0.6bn. 4/
So @UniversitiesUK @USSEmployers & @ucu should call on #USS to adopt just the following risk-increasing measure: increase of reliance to £19bn. 5/
Given how small TP deficit would become, DRCs within the limits of the Aon/UUK contingent contribution proposal would be fully justified. Moreover, cost of future service would go down by 2.25% (see👇), lowering lower bookend from 29.7% to c. 27.5%. 6/
UUK could say: in spite of the fact that 27.5% lower bookend would be actuarially justified, we would be willing to accept a more modest lowering to Aon/UUK proposed 29.2%, so long as #USS accepts accompanying Aon/UUK contingent contribution proposals in full. 7/
Assuming that they are consistent, rather than intransigent & unreasonable, #USS should endorse this justification for accepting the Aon/UUK contingent contribution proposal in full. 8/8
