Why Marketisation Drove the Strike

Negotiations between the Universities and College Union (UCU) and Universities UK (UUK) resumed yesterday, but strike action continues. Writing in a personal capacity, University of Edinburgh lecturer and UCU member Grant Buttars says we shouldn't diminish the role that blind neo-liberal dogma has played in this pensions dispute...

As UCU members across the UK engage in what is without doubt the largest industrial action in Higher Education in a generation, it's worth putting what is happening into the wider context of what is happening in the sector.

On 22nd February, UCU members began 14 days of strike action over 5 weeks in response to attacks on our pension scheme. Our Defined Benefit (DB) under the University Superannuation Scheme (USS) is at risk of being destroyed as employers want to end guaranteed pension benefits and leave it all to how the scheme’s investments perform in the market. What does this all mean? A loss of £10,000 per annum when a typical member of staff retires.

The justification being given by the employers is the scheme is unsustainable. They want to 'de-risk' the scheme, but figures show this will lead to a huge deficit. I say ‘their figures’ deliberately because UCU’s own scheme analysis comes to entirely different conclusions. We see an undervaluation of assets and an overvaluation of future liabilities.

Before I get into the wider ramifications, it's important to briefly explain the mathematics of all this. By its own measure, the scheme is in £8bn of surplus and worth £60bn in total. By comparison, the turnover of the whole higher education sector is only £35bn. And yet we're told to accept it’s in deficit due to expected future payments. This estimate is also based on a scenario where the returns on its investments are significantly lower than they are or are projected to be.

Let's cut to to the chase: What's the cost of closing the scheme? Where will the surplus go? It certainly won't be bestowed upon us. It may go to the employers as a ‘payments holiday’. If we're being frank, it's only going to one place: USS pockets.

If you accept the deficit narrative, how will it be paid? It can’t be paid from the Defined Contribution (DC) scheme because it’s entirely separate. Just now, it’s being paid for from our contributions according to a recovery plan instituted after a previous deficit forecast. USS have since acknowledged that there was no deficit and yet the recovery plan continues regardless.

My union has been in lengthy negotiations with UUK. Despite a massive effort on the part of UCU, the employers walked away and our members voted in huge numbers to take action. Even with odds stacked against us under new anti-trade union legislation, we secured an unprecedented turnout and mandate.

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So let's be clear: what's wrapped up in the current pension scheme is our deferred wages and this is set against a backdrop of a real-term decline in staff salaries of 15-20% since 2009. In that time, there's been an explosion of pay for those at the very top and a proliferation of what can only be called ‘vanity’ capital projects. At my own institution, the new Principal & Vice Chancellor received a package worth £410,000, 33% more than his predecessor, including £42,000 towards his pension. This isn't an attack on specific individuals but a point that there's something systematically wrong within the sector.

So how do we put this in wider context? This dispute didn’t simply arise because of pensions alone but because of what's happening right across the sector. From casualisation of staff through to student fees, it's the marketisation of Higher Education that's at the heart of this. Universities may be public authorities and charities, but they're also increasingly businesses, which is reflected in the way they're managed and the strategic planning that goes with it.

In the neoliberal age, “the market will provide”. Despite countless examples of this not being the case being readily available, this orthodoxy is still to the fore in how our universities function. As David Harvey points out: “Capitalists behave like capitalists wherever they are. They pursue the expansion of value through exploitation without regard to the social consequences.” This is true for the wider economy and its true within our own sector.

The attack on pensions is a manifestation of this because it fundamentally alters the relationship between employee and employer. It moves us from a collective scheme to one where we are individual consumers. The scheme also undermines itself encouraging those who can afford to do so to look to other options, leaving those who can’t behind.

As Waeem Yaqoob (Cambridge UCU) recently said in a London Review of Books article: "What's proposed is a textbook case of the dismantling of a shared good through financialisation." The news from the picket lines in Edinburgh and around the country is full of stories of solidarity. The scale of participation in the strike is unprecedented. The huge support from the student body clearly demonstrates the connection between our conditions and theirs.

We have also seen belligerent management forced to backtrack, such as when St Andrews threatened 100% deductions for working to contract and were then forced to make a complete u-turn. The Universities themselves are far from singing with one voice, with various Vice Chancellors moving (to varying degrees) towards UCU’s position. We have also compelled them to to talk at ACAS.

We need to be firm and clear: our pensions are not a commodity and should not be treated as such – they are our security in retirement. Marketisation destroys working conditions for staff, but it's also damaging for students and their learning conditions. We know we have an unprecedented mandate – let's use it to maximum effect.

For the latest on the UCU strike, click here.

@gbuttars