Is implementation of CDC ruled out for 2019

Post by **rogersh** » 29 Dec 2018, 18:44

It was stated by Terry Pullinger in the latest edition of "the voice" that the CDC scheme is expected to feature in the Queen's speech in May.
Would it be a correct assumption that earliest implementation would not be until April 2020 ?

arnold cheshire · Post by **arnold cheshire** » 29 Dec 2018, 19:05

Yes it's not happening soon

arnold cheshire · Post by **arnold cheshire** » 29 Dec 2018, 19:06

rogersh wrote:It was stated by Terry Pullinger in the latest edition of "the voice" that the CDC scheme is expected to feature in the Queen's speech in May.
Would it be a correct assumption that earliest implementation would not be until April 2020 ?

The queen will not be speaking about it

Post by **RobertT** » 29 Dec 2018, 19:26

Terry Pullinger initially said that only secondary legislation was needed. Then he said CDC could be introduced via existing DC legislation.
But in practice primary legislation will actually have to be introduced! Which means a longer time frame.

So personally, I take what Terry says about CDC with a pinch of salt.

The way I understand things is that a consultation is currently ongoing, and if the government decide to go ahead, then it has to be in the Queens speech at the state opening of parliament for the legislation stage to begin. Although I could be wrong on that.
What the exact timetable will be is hard to say, especially as Brexit is expected to take up a lot of parliamentary time.

There are news stories on this site with different takes on how long things will take. But as pension changes tend to happen on 1st April, then 2020 is the earliest CDC is likely to be introduced. With perhaps 2021 or even 2022 being more realistic?

arnold cheshire · Post by **arnold cheshire** » 29 Dec 2018, 19:31

I don't want it but thanks Robert T

Woody Guthrie · Post by **Woody Guthrie** » 29 Dec 2018, 20:54

There's also the fact that this kind of complex pension legislation doesn't just come from a big book of pensions, it has to be written by pension experts, picked apart by lawyers, ammended where necessary and then rechecked by the lawyers again and that's just to get a set of workable draft proposals together, all that takes time and money and somebody has to want to invest both of these things into a pension model that depending on who you talk to isn't that desirable in pension industry circles.

And then you have to find time and space to get it through parliament.

If this comes off at all it could be another 3-5 years and by that time you're looking at a different government. My best guess and it's only a guess is that we'll probably end up where we were headed in the first place...into a DC scheme. Either that or we're on the cusp of something special and it's a very long cusp.

heapsy · Post by **heapsy** » 30 Dec 2018, 01:32

I honestly don't think it will happen. The way both Labour and Tory governments have chipped away at pensions tells me they do not want anyone to have a decent retirement. If they manage to have a retirement at all. Do your selves a favour and put as much away as you can into a S&S ISA. If you don't, you will work until you drop. Even Labour have cottoned on to it.

Post by **Navalron** » 30 Dec 2018, 11:00

Pensions ARE still the best way to save for retirement especially with RM contributions which are generous compared to most other companies and also the reduction in national insurance and tax. But like I've said in this section before, I hope that it does happen but I'm 99.9% sure that it wont.

heapsy · Post by **heapsy** » 30 Dec 2018, 11:37

Navalron wrote:Pensions ARE still the best way to save for retirement especially with RM contributions which are generous compared to most other companies and also the reduction in national insurance and tax. But like I've said in this section before, I hope that it does happen but I'm 99.9% sure that it wont.

Agreed, you're right on both points. Problem is people are being ripped off / put off by the whole pension / saving / investment thing by governments constantly meddling. Many don't understand the rules, as we keep reading about on this forum. Not getting their heads around just how much they might need is another major issue. Sadly, many people don't / wont actually think about retirement because it isn't here right now, so in their minds it isn't an issue. The government don't seem keen on this new style of pension. I'm wondering if it's because they are frightened it will fail. They may also be wondering how they will be able to screw people out of their pensions, as it seems to be a common theme with all the major parties.

Post by **RobertT** » 30 Dec 2018, 12:31

It's been less than 12 months since RM and the CWU agreed the principle of CDC. During 2018 we've seen the Work & Pensions Select Committee discuss it, the pensions industry mull it over and the now the government is undergoing a formal consultation. So in my opinion, that's actually quite a lot in a relatively short space of time.

What needs to be realised is that CDC is a new concept for UK pensions and new bespoke legislation needs to be drawn up. In practice it's never going to be a particularly quick process!

Bringing in that legislation was considered a few years ago, but it was deemed unnecessary as there weren't any employers willing to dip their feet in the water. Plus CDC was thought not to fit in very well with flexibility rules.

But that has changed!
RM wants to offer it to it's workforce, and documents posted on these forums suggest CDC pensions can be accessed flexibly too.

As time's gone by I've had different opinions about whether CDC will happen or not, and I increasingly think it will! On paper at least, it's good alternative to the individual DC scheme and a lot more attractive to an employer than DB.
I don't think the government would be consulting on it, if they weren't taking it seriously.

Woody Guthrie · Post by **Woody Guthrie** » 30 Dec 2018, 16:09

I don't think the government would be consulting on it, if they weren't taking it seriously.

At the moment the government has over 4,000 live consultation documents and almost 300 regarding pensions.
The fact that it's got to the consultation stage in almost 12 months means very little.

Post by **RobertT** » 30 Dec 2018, 17:17

Woody Guthrie wrote:
I don't think the government would be consulting on it, if they weren't taking it seriously.
At the moment the government has over 4,000 live consultation documents and almost 300 regarding pensions.
The fact that it's got to the consultation stage in almost 12 months means very little.

I don't know where you got that info from but this government site suggests there's 81 open consultations with only 6 of them concerning pensions.

None of those 6 are of the same stature that were talking about with CDC, and non of them require primary legislation or represent a new type of pension scheme being introduced. Infact CDC is not included in the list at all!

The CDC consultation document is available to view here, and it seems to me the government are quite keen.

Here's a few quotes from it:

The government believes that it is right that we support innovation aimed at providing good outcomes for members seeking an income in retirement, and the type of pooled scheme proposed by RM deserves consideration.

With this in mind, we are focusing initially on creating an appropriate legislative framework for CDC schemes of the broad form and nature proposed by RM. The initial tranche of pooled risk schemes will have to operate within that framework.

We therefore propose to legislate to create the regulatory framework which will enable the type of CDC scheme proposed by RM to operate. We also intend to make provision for the legislation to be able to be modified and adapted by means of secondary legislation. This will allow us to take account of changes needed in the light of experience arising from RM. This will also allow for a more flexible and responsive approach if we need to adapt the regime for other CDC schemes.

k979aaa · Post by **k979aaa** » 12 Jan 2019, 22:27

The UK government is the most seedy organisation it legislates on porn before pensions I mean seriously all MP'S have VPN's in their homes and still cannot control their urges in the chamber yet we are expected to wait for these bunch of tossers to get their act together for our futures the mind beggars or did I say buggers! belief