In what one fellow described as possibly the most important decision to face the college in the past 50 years, Trinity College’s executive decision-making body has voted to leave the national pensions scheme for university staff — a move expected to cost £30m.

Now, the scheme, which funds staff pensions nationwide, is at risk of having its financial capacity downgraded. In light of Trinity’s expected departure, it will be placed on ‘negative watch’ — a leaked letter from national pensions scheme chief Bill Galvin has revealed. If one more employer comparable to Trinity in size leaves the Universities Superannuation Scheme (USS), the rating of its financial stability will be downgraded.

In 2017, employers’ fears of financial instability in investing in staffs’ pensions prompted them to propose drastic changes in their funding, leading to the largest staff strikes in British higher education’s history last year. 40,000 university staff across 64 institutions took to picket lines for 14 days of strike action, demanding the preservation of their pensions.

National pensions scheme on ‘negative watch’

On 7th May, national pensions scheme chief Bill Galvin wrote to head of the employers’ representative body, Alistair Jarvis — the “most pressing” of the issues discussed was that Trinity’s decision to leave the scheme had put it on the brink of a change in its rating for financial stability.


❝ PwC’s advice to the Trustee is that Trinity College, Cambridge withdrawing (if that is the decision it ultimately takes) does not in itself weaken the covenant. However, should one more strong employer withdraw from the scheme then the covenant would be downgraded from “Strong” to “Tending to Strong”.

According to the pension scheme’s official advisors, if one more strong employer chooses to leave the scheme, its financial capacity will be downgraded by one grade.

The UK Pensions Regulator’s ranking system to evaluate the strength of pensions schemes


The current rating of the pensions scheme's financial stability, characterised as having a strong asset position relative to its deficit size, and that there exists a “low risk of the employer not being able to support the scheme to the extent required in the short/medium term”.

Tending to strong

If another sizable institution follows Trinity, its financial capacity would be downgraded to ‘tending to strong’: a good asset position relative to its deficit and a positive outlook, but where there exists a “medium-term risk of employer[s] not being able to support the scheme and manage its risks”.

Tending to weak

A tending to weak rating occurs in situations where concerns have been raised around the strength of employers to support the scheme in light of its deficit size or the prospect of weak profits, signs of decline, or financial vulnerability.


A weak rating involves the risk of “potential insolvency” or such a large scheme that “it is unlikely ever [for employers] to be in a position to adequately support the scheme”.

Rated ‘strong’, the national scheme currently has the highest rating possible for its capacity to fund staff pensions. The downgrade would move it from ‘strong’ to ‘tending to strong’ — the second-highest out of four possible gradings.

Galvin’s letter said that advisors have recommended changing the scheme’s rules so that it would have greater power to determine whether an employer could leave the scheme, in order to prevent other employers from exiting. He also recommended that the rule change be considered “in the coming weeks”, in order for it to be included before an ongoing evaluation of the scheme’s financial position is complete.

In the past, Galvin has been outspoken about what he believes to be an increasingly precarious financial position of the national pensions scheme — and the decision by Trinity to leave could be used to justify future proposals from employers to take on less risk in their funding of staff pensions.

Students and staff calling for the preservation of staff pensions during an occupation of Old Schools last MarchLouis Ashworth

As seen in staff strikes last year, employers were motivated by concerns over the scheme’s financial situation to move toward a more conservative funding model in which employers would take on less risk, but where staff could have been left as much as £200,000 worse off.

Explained Why did university staff strike over pensions?

University and Colleges Union (UCU), the trade union for academics and university staff organised industrial action at 65 institutions nationwide in February and March, in protest against pension proposals put forward by Universities UK (UUK), an advocacy body for university employers. UUK proposed in November to replace defined benefit pension funds for incomes under £55,000 with defined contribution pension funds, a move intended to mitigate an estimated deficit of £6.1bn in the Universities Superannuation Scheme (USS).

The value of defined contribution schemes depends on returns from underlying investments in the stock market, as opposed to defined benefit schemes, which offer a guaranteed income upon retirement. UCU has cited analysis which estimates that staff may be up to £200,000 worse off upon retirement under entirely defined contribution schemes.

During strike action in late February, national bodies reached a provisional agreement which ensured defined benefit pension schemes for incomes below £42,000, while increasing employer and employee contributions by 1.3% and 0.7%, respectively. The agreement was resoundingly rejected by UCU members, however, and action short of a strike continued until late March, at which point UCU and UUK jointly agreed to the creation of a Joint Negotiating Committee to assess pensions changes. UCU members have voted to end the strike action, but the terms of future pensions scheme proposals remain unknown.

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Dr Sam James, president of the Cambridge branch of the employee’s union, commented: “As Trinity themselves acknowledge and has been reiterated by multiple authorities over the past eighteen months – USS themselves, the Joint Expert Panel convened as a result of the 2018 strike, and the actuarial advisers of all the key stakeholders – USS is in a sound financial position, and is far from needing to call on employers to pay pensions as they become due.”

When Varsity reported in December that the college would vote on whether to leave the national pensions scheme, a spokesperson said that Trinity’s withdrawal would have “no material impact on the scheme’s overall funding position or membership.” A spokesperson for the national pensions scheme reiterated in light of Galvin’s leaked letter that Trinity’s withdrawal “would, in isolation, have no material impact on [the scheme’s] funding position or overall strength”.

However, Galvin’s letter, written following a consultation with official advisors, indicates that there is potential for Trinity’s decision to ultimately generate material impact.

Project Bronze confirmed, after five years in the works

On 15th March, Trinity’s college council —its executive decision-making body — decided by 9 votes to 1 to leave the scheme following a consultation of the college fellowship which was criticised by one fellow as “ill-timed, rushed, and inadequate”. The Council aims to exit the scheme by preferably the end of September this year.

In meeting minutes marked ‘private and confidential’, it was noted that the college’s senior bursar and its fellow for communications would set up a working group to “prepare ways of communicating the decision and the reasons for it.”

Cambridge University staff protesting pension changes last yearLouis Ashworth

In a statement, a spokesperson for the college said: “Trinity College is reviewing pension arrangements for its academics. Consultation is underway and any decisions will be taken after the completion of this process.” They declined to comment on what remaining steps are involved in the consultation before the decision is confirmed.

Dr James commented on Trinity council’s vote: “Trinity is a very small USS employer, so would only be called on to cover a significant proportion of a funding shortfall if almost all other pre-1992 HE institutions were driven into bankruptcy. This doomsday scenario is vanishingly unlikely, and if it were to occur Trinity getting to hang on to its extensive landholdings would hardly mitigate the disaster.

“Such irrational extravagance is made possible only by Trinity’s unique combination of millions in ready cash and a very small USS-enrolled workforce.”

In a statement, a spokesperson for the national scheme added: “The Trustee’s primary objective is to ensure the valuable benefits promised by USS are secure for all of our members and options for protecting the strength of the collective financial support offered by sponsoring employers are currently under consideration.”

Leaked reports in December revealed Trinity’s proposal to leave the national pensions scheme, which would cost the college £30m. Officials called the proposal Project Bronze.

Reports showed that the main reason for Trinity’s departure was officials’ fear of what they called an unlikely but existential risk of financially insecure higher education institutions collapsing. The nature of the national pensions scheme entails that, in that scenario, the college would be forced to prop them up.


Mountain View

Revealed: How Cambridge attempted to rig the system and steer staff strikes

In a report marked confidential, officials had noted that any decision to leave the scheme would be met with “(negative) publicity.”

Dr Jason Scott-Warren, a member of the University’s executive decision-making body, said Trinity’s decision was “deeply regrettable and deeply misguided.”

He added: “It is depressing to see the college colluding with the ideological assault on a strong and highly-valued not-for-profit pension scheme. I hope it will be met with a local boycott of academic collaborations with Trinity and a refusal of USS members across Cambridge to supervise for the college.”

Trinity Senior Bursar Rory Landman, who put forth the proposal, said he had been considering the departure for five years, at an informal meeting held on 9th February for the college’s fellows to share their views with the council ahead of the vote. Landman did not respond to a request for comment.

Amongst the issues raised at the meeting were that the £30m premium “could usefully be spent on better things”, that the financial risk which exiting the scheme was intended to insure against “seemed very unlikely,” and that more debate should have been allowed as many fellows had not heard of the proposal “until recently.”

Minutes showed two out of fifteen recorded statements presented points in favour of the decision. One said that the decision could “surely be presented in a positive way, preserving our assets not only for selfish reasons but so that they can continue to be used to help others.”

Documents also recorded Landman’s opening statement at the meeting, in which he commented on the proposed £30m withdrawal: “One should not regret having insured one’s house against fire, when it does not in fact burn down.”