Only a week after the Pensions Regulator finally authorised Royal Mail’s Collective Pension Plan as Britain’s first CDC scheme, a strike that had threatened the future of the Plan’s sponsor has been averted.
The news will come as a relief to everyone who holds the Royal Mail dear, including the CWU’s principal negotiator of the CDC solution Terry Pullinger. Terry has I understand been ill, may this news speed your recovery.
According to the BBC website ,a joint statement said:
“After almost a year of talks, Royal Mail and the Communication Workers’ Union (CWU) are pleased to announce they have reached a negotiators’ agreement in principle.
“The proposed agreement will now be considered by the executive of the union before being voted on by the union’s membership.
CWU general secretary Dave Ward and deputy general secretary Andy Furey said: “On the basis that the negotiators’ agreement is endorsed by the postal executive, we will put in place a full communications plan to engage members.
“Thank you for your support and patience. It has got us to this point.”
Worryingly, earlier this month, Royal Mail said that a return to industrial action could result in the postal service going into administration. It said the strikes have cost the company £200m in lost business and in covering striking staff.
The continued prosperity of Royal Mail is important to the Royal Mail CDC and – as it is 1/1 on the CDC list, to CDC as a concept. It is usual for ideas to breed , for their to be a mate. We hope that one comes along as the Royal Mail CPP looks an endangered species without a mate.
What this tells me is that anyone who wants to see CDC prosper as a concept must get behind it now. It is heartening to see First Actuarial celebrating the authorisation, Hilary Salt , Derek Benstead and the company were prime movers, advising the CWU. WTW advised Royal Mail, both have stated that they have clients looking to follow Royal Mail, now is the time for those employers to seek authorisation – if they want their own scheme.
If they want to participate in a multi-employer scheme, they will have to wait for the CDC regs and code 2.0, which we hope will shortly emerge following the closure of the recent DWP consultation.
Meanwhile , organisations such as the RSA, which hosts a working group looking at practical applications of CDC style pension thinking, should look to developments in the States and Canada around open-ended modern tontines to help savers solve the tricky issue of turning pots to pension. Adrian Boulding, David Pitt-Watson and Hari Mann have a powerful force for good in this group.
