Royal Mail Group (RMG), the Communication Workers Union (CWU) and Unite the Union have confirmed plans for a new collective pension scheme following a successful consultation process, with the scheme to be launched by the end of 2022 or early 2023.

The positive outcome to the consultation, which was launched last year, has been highlighted by the group as a key “milestone” for the scheme, with plans for the collective defined contribution (CDC) style scheme first confirmed in 2018.

RMG subsequently urged the government to introduce the appropriate legislation for the scheme, with a consultation later launched by the government in 2018, before CDC legislation passed into law in the Pension Schemes Act 2021.

As a result of this progress, and the successful member consultation, the CWU has now confirmed that the introduction of Royal Mail's collective plan is now only awaiting “final, minor legislative work” before a formal application can be made to The Pensions Regulator (TPR) to open the scheme.

Indeed, the government recently confirmed that CDC legislation for such schemes will come into force from 1 August 2022, with TPR also currently consulting on its draft code of practice for the authorisation and supervision for CDC schemes.

In light of this, the group stated that it hopes to launch the collective plan "by the end of this year or early 2023.

In a joint statement, RMG chief financial officer, Mick Jeavons, CWU DGS, Terry Pullinger, and Unite CMA national representative, Gary Sassoon-Hales, commented: “Together we’ve designed a new pension plan that gives our people two things: a cash lump sum and a wage in retirement.

“The consultation on the pension changes is now complete and we’ve considered people’s feedback. We’re excited that this brings the Collective Pension Plan a step closer to launch.”

Member communications from the Royal Mail Group also welcomed the “milestone” as a “positive development”, although it clarified that there are still “some further changes to the law required.

“There is anticipation that these final changes to the legislation should be completed by August, as all parties are currently working with the government on this important matter,” it stated.

“Once the details are finalised, we can then apply to TPR to open our scheme. After the application process has been completed, we should be able to deliver the new scheme in the latter part of this year.”

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