The diagram shows the relationship between the calculated pension liabilities of the USS DB pension scheme since 2002 from Actuaries’ Reports for the statutory valuations (and estimated Interim valuations for years when there was not a full valuation). Also shown are the gilt yields at the time of the valuation for three maturities: 5, 10 and 30 years.

You can see how strong is the inverse relationship between the calculated liabilities and the gilt yield. The real liabilities are nowhere near as variable because they depend on demographic not financial factors.

It is to be hoped that all involved in discussions about the future of the scheme including Conditional Indexation keep in mind this instability resulting from gilts-based discounting.

Source: USS Actuarial Reports, Debt Management Office

January 2026