There is “still a lot of work to do” to effectively communicate and educate scheme members of the Royal Mail collective defined contribution (CDC) scheme, Royal Mail Group director of pensions, Angela Gough, has said.

Speaking in a panel session at the launch event for Royal Mail’s CDC scheme, Gough emphasised the importance of ongoing communication and education to help members understand CDC.

“We will be doing this continuously,” Gough said. “We will be reminding people how the new scheme works.”

Adding to this, Communication Workers Union postal assistant secretary, Andy Furey, said that the union was committed to raising both awareness and knowledge.

“We want people to be more aware of what the future means to them so they can survive and live with dignity and respect in retirement. I think that’s vitally important,” he said.

He acknowledged that “a lot of work” has already been done to implement the CDC scheme but stressed that efforts to build member knowledge must continue.

“We have a lot more work… to raise the knowledge and awareness of what it all means to people and how they can benefit in the future,” he continued.

Royal Mail Collective Pension Plan trustee, Tegs Harding, also argued that clear communication and member engagement are key priorities.

“There is a big focus on communications and a big focus on member testing,” Harding said.  

“Just because we think it’s clear, members might not. We are really keen to have representatives sitting right there with us going through that user testing.”

Gough also acknowledged that while there are broader challenges in setting up CDC schemes, that investment is "really worth it".

“The benefits to members are huge," she stated. "Not having to make decisions about your pension is massive.”

She also suggested that while it is hard to set up CDC schemes, "hopefully, it won’t be at some point when master trusts offer it out to everybody".

However, Gough suggested that communicating realistic expectations was essential.

“We talk about communications all the time and I am super passionate about it and proud of the communications we've already done in this scheme,” she said.

“I think they are so important, and you need to get through the message that pensions can go down and they can go down in retirement. That message is really important.”

The Royal Mail Collective Plan, the UK’s first CDC scheme, was launched on 7 October and is set to offer over 100,000 Royal Mail employees a cash lump sum and an income in retirement.

The scheme was initially announced in 2018 and became the UK’s first CDC scheme in 2023 after passing The Pensions Regulator’s assessment process.

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