LTB 396/21 - Royal Mail Collective Pension Plan - Members' Consultation

[POSTMAN]

LTB 396/21 – Royal Mail Collective Pension Plan – Members’ Consultation
No. 396/21

17th September 2021

Dear Colleagues

Royal Mail Collective Pension Plan – Members’ Consultation

Branches will be aware that the Pension Schemes Act 2021 received Royal Assent in February this year and this provided the primary legislative framework for Collective Defined Contribution (CDC) pension schemes in the UK. Royal Mail Group (RMG) and CWU had previously committed to implementing a CDC scheme and since Royal Assent, we have been working with RMG on plans to introduce a new collective pension scheme for the benefit of our members.

Consultation on the new Royal Mail “Collective Plan”

I am pleased to advise you we have now reached the stage whereby RMG will be launching a consultation with CWU for a new Royal Mail Collective Pension Plan (to be known as the “Collective Plan” for short). This is a legal requirement for a change in pension plan and as part of this process, they will write to our members with information about the proposed change and give them an opportunity to provide feedback and ask questions.

The formal consultation launches on Tuesday 21st September and closes on Sunday 21st November. Consultation packs will soon start to land on our members’ doormats.

The following Tripartite Statement has been agreed between CWU, Unite and RMG:

‘Together, we have worked hard over the last few years to design an exciting new pension plan for our people and, with consultation underway, we are pleased to see the Royal Mail Collective Pension Plan take a step closer to launch. We all believe that you will be best served by this Plan which would provide a lump sum and a wage in retirement in a way that is sustainable and affordable for the business and members.’

Mick Jeavons Terry Pullinger Gary Sassoon-Hales

RMG Chief Financial Officer CWU DGS (P) Unite CMA National Representative



Members can access information in regard to the consultation via the following RMG link:

www.myroyalmail.com/collective-plan

The RMG website provides answers to important questions our members may have and also explains what happens next. In addition, there is the ability to ask specific questions directly via the website. For further assistance, a FAQ comparison table has been produced which outlines how the benefits in the Collective Plan compare to those in the RMPP and RMDCP. The table is attached to this LTB for your information.

Following the consultation, assuming a positive response, if all goes smoothly, the Collective Plan will be launched in 2022. Members who have been with RMG for more than one year would stop building up benefits in the Royal Mail Pension Plan (RMPP) and the Royal Mail Defined Contribution Plan (RMDCP) and start building them up in the Collective Plan instead. Benefits they have already built up in RMPP or RMDCP would be there for them when they retire.

In closing, the main purpose of this LTB is to signal the launch of the consultation arrangements, which is a legal process. We would anticipate further information being provided next week.

Any enquiries in relation to the content of this LTB should be addressed to the DGS(P) Department.

Yours sincerely

Andy Furey

Acting Deputy General Secretary (Postal)

Attachment to LTB 396/21

[Woody Guthrie]

At least it has a name now. RMCPP to add to RMPP, RMDCP and RMSPS...

[RobertT]

At least it has a name now. RMCPP to add to RMPP, RMDCP and RMSPS...

We knew that a while back!

[RobertT]

https://www.cwu.org/news/royal-mail-mem ... SVZOi1KlKk

From Monday morning, pensions consultation packs will start landing on Royal Mail employees’ doormats, as the final statutory step towards the establishment of the groundbreaking new scheme…

Since the Pension Schemes Act 2021 received Royal Assent back in February, the CWU and the company have been working though plans to introduce the new Royal Mail Collective Pension Plan.

And the mailouts to members represent another significant milestone in this process, the statutory 60-day consultation – which is a legal requirement before new pension schemes can be launched.

CWU deputy general secretary postal Terry Pullinger told CWU News: “This is a very positive development that means we are one step nearer delivering on our key policy of better pensions for all, which will mean that every single Royal Mail employee will be able to look forward to a decent and dignified retirement – and also have confidence that they belong to a safe and robust pension scheme.

“It’s been a long road and it was several years ago now, back in 2015/16, when we began talking about collective defined contribution (CDC) pensions. So, it’s good to see this vision getting closer to becoming a reality for all. Our members do a superb job every day – and a decent wage in retirement is what they thoroughly deserve.”

CWU assistant secretary Andy Furey, who has departmental responsibility for pensions within the union’s postal department, explains: “Following the consultation, assuming a positive response, the Collective Plan will be launched next year.

“Members who’ve been with Royal Mail for more than one year would stop building up benefits in the Royal Mail Pension Plan (RMPP) and the Royal Mail Defined Contribution Plan (RMDCP) and start building them up in the Collective Plan instead.

“And benefits they have already built up in RMPP or RMDCP will be there for them when they retire.”

The formal consultation launches on Tuesday 21st September and closes on Sunday 21st November. Consultation packs will start to land on our members’ doormats from Monday onwards.

[zubriz19]

Work for 7 years and 6 months now taking ihr how much will they pay me ? Also I have 153 hours holiday left , I am full time 35 hours contract can anyone please advice me how much will I get paid ?

[RobertT]

Work for 7 years and 6 months now taking ihr how much will they pay me ? Also I have 153 hours holiday left , I am full time 35 hours contract can anyone please advice me how much will I get paid ?

Not sure what this has got to do with the CDC pension?

Assuming you're getting IHR with lump sum, then you'll get 34 weeks pay(tax free), plus I think 9 weeks PILON which is taxable.
You should get paid for any outstanding holidays you are due, bearing in mind you're only entitled to a pro rata amount up to the date you leave.

[zubriz19]

Thank you so much it’s really helpful to understand

[Dexydog]

Just received a letter stating this plan will commence on 7th October 2024.
Dies anyone know where and who with these funds are being run by?
In the app I've put down to opt into the 1% lump sum, but doesn't say who it is invested with- further down avc's are with Scottish Widows, so opted in at 10%.
Currently only got RMDCP which is managed by Scottish Widows.
My question I suppose is, will all the funds in the new scheme be held by them- and if so I assume will shoe separately to the existing scheme.
I have emailed the executive shown on the app all the above questions, but no reply after a week.
Anyone have any idea??

[RobertT]

The money will be invested in a few different asset classes, like equities, bonds, property, etc.

There's going to be a substantial amount of money going into the overall pot, which will start to build up into the £Billions in quite a short space of time.

There doesn't seem to be any upfront info on exactly who the fund managers will be, but there's going to be quite a few!
The RMPP has around 30 if I remember correctly and the RMCPP is likely to be similar.

There is some basic investment info on the RMCPP website for you to read, but it doesn't go into much detail.

The new scheme, including AVC's, is completely separate from all existing RM pension schemes.

[Dexydog]

Are we likely to see more info soon?
Surely if the pension is changing we should be allowed to know who it sits with, how we can access info on its progress etc.
The only solid info I can see is any avc's will be with SW.

[RobertT]

Are we likely to see more info soon?
Surely if the pension is changing we should be allowed to know who it sits with

There's a good chance the annual report and accounts will provide names of the investment managers used. But as they take a certain amount of time to collate, I assume the first one(2024/25) will be released sometime in 2026.
Otherwise the trustees might put it on the website?

how we can access info on its progress etc.

It's not really the type of scheme you can just login to and get an up to date valuation, as you can with the RMDCP.
As per the info on the website, the scheme actuaries will value the scheme on an annual basis to determine how much pension and lump sum you'll get. They will then send a statement with the figures.

The only solid info I can see is any avc's will be with SW.

You will be able to see the progress of AVC investments online, via the money4life website.

[Dexydog]

Thanks RobertT for taking the time as always.
You're a gem on this site

[Krafty]

We received a letter in June 2024 explaining about the Royal Mail Collective Plan and AVCs.
It mentioned that any AVCs will be invested into the Collective Plan's default AVC Lifestyle Strategy and this can be changed after joining.

Any idea how I go about looking into this and changing it?

[Hyrrokkin]

We received a letter in June 2024 explaining about the Royal Mail Collective Plan and AVCs.
It mentioned that any AVCs will be invested into the Collective Plan's default AVC Lifestyle Strategy and this can be changed after joining.

Any idea how I go about looking into this and changing it?

Waiting for this info myself - i would think we will get something by post in the new couple of weeks.
Although i have seen mention of a self-service portal coming soon (assuming means pension website to check pension/details/change funds etc etc.

[heapsy]

I'm waiting too. I wont be staying until 67, so I want to take more control of my investments.