ROYAL MAIL: PENSIONS WORKING GROUP AND PENSION SCHEME BILL
Branches are advised that a meeting of the Pensions Working Group recently took place to discuss all matters relating to pensions and recent developments including the passage through parliament of the Pension Schemes Bill. This legislation includes the concept for enabling the introduction of Collective Defined Contribution (CDC) pension schemes. In this regard, the second reading of the Bill went through the House of Lords on 28thJanuary with full support from all parties.
It is clear there is a political consensus around this proposed legislation and that Royal Assent will be given later this year, thus making the ability to introduce CDCs a legal reality. It is also fair to say that the CBI has been supportive of CDCs and responded positively to the government consultation on this matter.
In moving the Pension Scheme Bill in the House of Lords, Baroness Stedman-Scott, the Parliamentary Undersecretary for Work and Pensions said “In developing these measures, I welcome the cross-party and external stakeholder support for the methodology and legislative approach that the Government have used”. Baroness Stedman-Scott went on to say “It is right for us to support employers and unions working together to bring about such a positive outcome”. The last sentence quoted was in reference to the collaborative working between Royal Mail and CWU who have been at the forefront in engagement to develop a CDC pension scheme.
Lord Hain and Baroness Drake spoke in the debate and in particular Lord Hain referred to the Union in his speech as follows:
“I commend Royal Mail and the CWU for their efforts in working closely together to pursue this new ‘third way’ pension scheme, which, as CWU national officer Terry Pullinger said at the time of the agreement, would ‘secure our members’ future employment, standard of living and retirement security’.”
We also wish to highlight the Pension and Lifetime Savings Association press release on the Bill’s introduction last October which said that CDC schemes “offer employers increased flexibility and choice in how they structure schemes to benefit savers.” This statement was also quoted by Baroness Stedman-Scott in her speech when moving the second reading of the Bill.
A new and welcomed part of this Bill is the extension to include Northern Ireland within its provision (originally N.I. was excluded as a devolved matter). Clearly this is a positive development for our members in Northern Ireland.
A link to DWP’s Explanatory Notes to the Pension Schemes Bill is as follows: