08 August 2017 
Karel Thomas, Executive Director
As you know, we commissioned Mercer again to provide an outline methodology for institutions to arrive at a suitable discount rate, that reflects their liability profile, and can be used in the calculation of the USS deficit recovery liability required under FRS102. The updated guidance for discount rates based on market conditions as at 31 July 2017 has now been issued and can be downloaded here. For historical reference, this paper sets out the discount rate information based on 28 February 2017 market conditions and this paper provides guidance on using the rates.
In summary, actual discount rates derived as at 31 July 2017 are higher than those derived as at 28 February 2017. This will result in lower provisions at the 31 July 2017 year end than those estimated using 28 February 2017 market conditions.
