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USS ponders £6bn alternatives push

Universities Superannuation Scheme, a UK pension fund with £22bn under management, is reportedly thinking of moving up to 20% of assets into strategies including private equity and infrastructure.

Following an asset-liability assessment carried out by Mercer Human Resource Consulting, Universities Superannuation Scheme (USS) is considering big changes to its allocation strategy, according to a report in today’s Financial Times

USS is the UK’s second largest pension fund with assets of £21.7 billion (€31.6 billion; $40.4 billion), of which 80 percent are currently invested in public equities. Now USS, whose investments are overseen by chief investment officer Peter Moon, is considering the incremental reallocation of up to £6 billion away from the public markets and into alternative strategies such as private equity and infrastructure investing, the FT reported. 

The newspaper quoted Moon as saying that as a first step, the USS envisages investing £1.5 billion into asset classes other than quoted equities by March 2008.

The management committee of the USS trustee company is to make a decision on the proposed changes on June 14.

The pension, which invests the savings of over 200,000 UK academics and university employees, revealed a £6.6 billion deficit in 2005.