Frank Field MP has said the £12.6bn deficit at the Universities Superannuation Scheme (USS) and the transfer advice individuals receive are topics which demand closer scrutiny.
The chairman elect of the Work and Pensions Committee (WPC), which is expected to become fully operational after the summer recess, has flagged up both issues through two interventions. These interventions highlight potential lines of formal investigation, although inquires can only be launched when the committee is fully staffed and decides to begin one.
The size of USS's actuarial deficit as of 31 March 2017 emerged when its annual reports were published a month ago, having increased 138% from £5.3bn at the previous triennial valuation on 31 March 2014.
Field has sent letters, seen by Professional Pensions, to USS chair of trustees Sir David Eastwood, Universities UK president professor Janet Beer, The Pension Regulator's (TPR) chief executive Lesley Titcomb and universities minister Jo Johnson.
The letters to the trustees and watchdog enquire about what information can be given about recent developments in the fund's deficit, patterns of investment and what might happen to the scheme over the next decade.
The correspondence to Johnson calls on him to look at how the salaries of university vice chancellors that run the USS relate to the pay they receive.
Field said: "An important aspect of looking at USS is it is almost an extension of the committee's inquiry in the last session of parliament on intergenerational fairness. This issue [USS's deficit] raises questions about how will the deficit be plugged and who is going to pay for it? If the students pay for it through higher fees, this raises more questions about intergenerational fairness."
In response, a spokesperson for USS explained the scheme is currently undergoing its 2017 valuation and it still has not decided how the deficit will be closed.
"We will shortly consult with Universities UK regarding the trustee's views, but the deficit is unlikely to be as large as the £12bn shown in our annual accounts and remains within affordable levels for sponsoring employers.
"The lower expected returns on assets will increase the cost of future pensions and our stakeholders - Universities UK and University and College Union will need to decide how to respond."
Meanwhile a Universities UK spokesperson said the organisation will send a full response to Field and added: "It is clear that changes need to be made to ensure pension costs and risks are controlled and these issues are being addressed."
A spokesperson for TPR said: "We remain closely engaged with the trustees of the USS regarding the funding of the scheme as part of our role to protect member benefits and the Pension Protection Fund. We do not comment on specific pension schemes or employers unless it is appropriate to do so."
Another area of work that Field wants to continue is the sustainability of defined benefit (DB) schemes.
Meanwhile, the quality of transfer advice has received more attention as the Financial Conduct Authority (FCA) fined an individual compliance oversight officer £75,000 in July.
Speaking to Citywire's New Model Adviser on 23 August, Field said he was worried about the advice members receive.
"I am concerned that companies hire the people who are actually going to give the advice. I think this is a treacherous area for people and if they are going to make a move they really need independent expert advice and not salesmen sent along from the company. So this is something we will be looking at."
Here the regulator said its primary concern is that DB scheme members and their advisers have all the information they need to make an informed decision and is working with the FCA to achieve this.
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