TPR authorises UK's first CDC pension scheme

[RobertT]

https://www.pensionsage.com/pa/TPR-auth ... scheme.php

The Pensions Regulator (TPR) has assessed and authorised the UK’s first collective defined contribution (CDC) pension scheme, the Royal Mail Collective Pension Plan (RMCPP).

TPR highlighted the "milestone" as demonstration of how the regulator is pursuing its strategy to embrace innovation to help meet pension savers’ needs.

Commenting on the news, TPR executive director of frontline regulation, Nicola Parish, said: “I am delighted that we have authorised the first CDC scheme, which is a clear demonstration that we are serious about embracing innovative approaches to deliver the pensions of tomorrow.”

Minister for Pensions, Laura Trott, added: “TPR authorising the first CDC scheme is a landmark moment, and this is just the beginning.

"We have seen the positive effect of these schemes in other countries and our plans to extend our CDC framework will enable more pensioner savers to achieve the retirements they want.”

Applications for CDC schemes officially opened in August 2022, after the Pension Schemes Act 2021 first introduced an authorisation and supervision regime for CDC schemes.

Under the regime, applicants are required to show they meet stringent criteria, including that those who run the scheme meet fitness and propriety requirements, have the right systems and processes in place, can show the scheme is financially sustainable and have robust member communications.

Although CDC schemes can only currently be set up by single employers, the Department for Work and Pensions recently consulted on plans to extend CDC to accommodate multi-employer schemes, also considering the potential for CDC as a decumulation only option.

[RobertT]

https://www.myroyalmail.com/collective-plan

Update on the Collective Plan launch

There has been a lot of work going on to move forward with the Royal Mail Collective Pension Plan (the Collective Plan for short).

As a reminder, we designed the Collective Plan with the CWU in a way that’s sustainable for everyone and, when it launches, it will change the way people at Royal Mail save for their retirement. Most people will stop building up benefits in their current pension plan and start building up benefits in the new plan. The new plan will give our people a lump sum and an income for life after they retire.

We have hit some important milestones and wanted to share them with you

An independent Trustee Board, comprising of professional trustees, Royal Mail employees and union members, has been appointed to run the Collective Plan. They were responsible for applying to the Pensions Regulator to authorise the Collective Defined Contribution (CDC) section of the Collective Plan The application was submitted in 2022.

In April 2023, The Pensions Regulator informed us that the application was successful.

Next steps

Receiving authorisation is an important step. However, there are some further changes that are needed to the law to make launching the Collective Plan possible. We are continuing to work with Government, the CWU, Unite CMA and others on this. Government is aware that our people have been waiting for the Collective Plan to launch and that we need changes to the law to make this happen.

Our people don’t need to do anything right now. We will let them know when we are ready to launch the Collective Plan and will write to them in plenty of time with details of the plan and their options.

In the meantime, our people continue to get information from any pension plan that they’re in now.

You can find the consultation information, original booklet and FAQs that were added during the consultation further down this page.

[robking]

Will start 1st of July would be my guess as that's a quarter of the way through the financial year and half way in the calendar year.
If they can't clear the remaining hurdles in time 1st of October is another possibility.

[RobertT]

Will start 1st of July would be my guess as that's a quarter of the way through the financial year and half way in the calendar year.
If they can't clear the remaining hurdles in time 1st of October is another possibility.

It can start whenever it's all set up, there's no need for it to be a set period into the financial year. Although the 1st of any given month seems more logical than any other random date.

[Schiff]

I believe that they have to give people at least 3 months notice before starting the new scheme, so 1st July is already out. If they have to wait for some kind of additional legislative change before giving that notice to staff then how long is a piece of string.

[renrag40]

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

[heapsy]

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

1st April has been the date of all previous changes to the pension scheme. I'm hoping it will be that late. Trying to get a bit more into the current AVCs. Tbh, I'm not sure I want to join a scheme with 67 as the retirement age, I wont be in the job that long.

[freespeech]

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

1st April has been the date of all previous changes to the pension scheme. I'm hoping it will be that late. Trying to get a bit more into the current AVCs. Tbh, I'm not sure I want to join a scheme with 67 as the retirement age, I wont be in the job that long.

Same here….hope to be gone within three years and would like to build up more in AVC’s and cash balance. Will consider options for the new scheme but less than three year’s contributions aren’t going to be worth much at all.

[heapsy]

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

1st April has been the date of all previous changes to the pension scheme. I'm hoping it will be that late. Trying to get a bit more into the current AVCs. Tbh, I'm not sure I want to join a scheme with 67 as the retirement age, I wont be in the job that long.

Same here….hope to be gone within three years and would like to build up more in AVC’s and cash balance. Will consider options for the new scheme but less than three year’s contributions aren’t going to be worth much at all.

I reduced my AVC payments to stay within PSE. Pensions wont tell you what the limit is and the minimum wage increased by 9.1%. Gutted tbh, but it takes about 2 weeks to put everything right if you drop out.

[RobertT]

I believe that they have to give people at least 3 months notice before starting the new scheme, so 1st July is already out. If they have to wait for some kind of additional legislative change before giving that notice to staff then how long is a piece of string.

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

1st April has been the date of all previous changes to the pension scheme. I'm hoping it will be that late. Trying to get a bit more into the current AVCs. Tbh, I'm not sure I want to join a scheme with 67 as the retirement age, I wont be in the job that long.

I think they just said they'll tell us when CDC would start about 3 months beforehand. I don't think there's anything official or legal about that time frame, although I could be wrong.

I'm not sure what other legislation needs to be put in place before it can start, but these things can happen quite quickly if the powers that be want them to.

1st April has been the date of most previous changes to the RMPP. Although the change from section A to section B of POSSS, as it was known at the time, actually happened on 1st December back in 1971.

The RMDCP was started in February 2009, following the closure of the RMPP to new entrants in 2008.

The RMCPP will be a completely separate scheme to the existing ones, so 1st April isn't relevant.

[cartero707]

I reduced my avc's to £85 and stayed within limits. Looking to increase again if we get a pay rise.

[Hyrrokkin]

If the further legislation doesn't pass through parliament by the of July then nothing will then happen until mid September because of their summer recess...... no doubt visiting some of their constituents in Tuscany during it.
If 3 months notice has to be given then realistically we would be looking at some point in the new year.
My guess..... 1st of April 2024....... April Fools Day.

1st April has been the date of all previous changes to the pension scheme. I'm hoping it will be that late. Trying to get a bit more into the current AVCs. Tbh, I'm not sure I want to join a scheme with 67 as the retirement age, I wont be in the job that long.

Same here….hope to be gone within three years and would like to build up more in AVC’s and cash balance. Will consider options for the new scheme but less than three year’s contributions aren’t going to be worth much at all.

I reduced my AVC payments to stay within PSE. Pensions wont tell you what the limit is and the minimum wage increased by 9.1%. Gutted tbh, but it takes about 2 weeks to put everything right if you drop out.

Pretty pathetic they will not do that - you are asking for information not advice

I am paying £108 Flexiplan & Bonusplan payment
This weeks payslip showed no change guess i will find out next week if i have gone over PSE limits

[rambo1]

Yipee, another pension to add to the list..........and this one you don't even know what you'll be getting.

[Shirtbuttons]

Can I opt out as I only have 6 years to go but hoping to be out within 4 years max. Not sure if I’ll even make that. 36 in and really ready to go asap.

[robking]

Can I opt out as I only have 6 years to go but hoping to be out within 4 years max. Not sure if I’ll even make that. 36 in and really ready to go asap.

Nobody HAS to join the new pension scheme but you'll be mad not to, it's worth doing even if you have only weeks to go, you get tax relief and the employer pays money in too, it's like turning down an extra pay rise.