Steve Webb does not need introduction but the subjects he covers do – and he introduces ideas that may be new to us, no matter how we might like to consider ourselves pension experts!

The first part of this blog is from Steve , leading to a video that helps the bereaved get inherited pensions from their spouse.

The second part of this blog explains how CDC will pay pensions to surviving spouses.

The blog ends with a question to you which I’d like answers to!

So what about Collective Pensions (CDC)? What protection will they offer spouse’s.

I will be asking this question this morning about collective pensions (CDC). I will be asking Steve’s colleagues, Steven and Helen what they reckon the correct position CDC should take in providing an ongoing “workplace in retirement” to partners who’ve been bereaved of their spouse. You can participate in the debate by clicking here.

Our view is that the decision to protect is almost an obligation so we will be ensuring everyone who has a collective pension has a spouse’s pension as well. We’ll be doing so through our CDC (Pensions Mutual) every member will have a pension that pays out to a spouse as well s them. This may be a little unfair to those who have neither partner or any love for those they are still married to but the word “dependency” is important.

The vast majority of the problem is with men dying first (including of course in men only marriages). We are struggling to define a partnership with no marriage and we may arrive on a definition of a common law marriage but for the most part “spouse” is the person being protected.

The cost to the collective pension’s conversion rate in including a spouse’s pension is not substantial but the benefit when it is called upon is. What I mean by conversion rate is the pension you buy when your boss makes a payment on your behalf (or you make one yourself). The payment converts to pension and the price at which is does has a small deduction to make the payment to your spouse (if you die first).

So in one blog you get answers to two questions!

Like Steve, I don’t think that older people think much about the situation that would occur if they lost their spouse. we find it hard to talk about it to our partner and we’ve thought about this quite a lot.

Our answer is to take away the opportunity to fail to make provision and leave the spouse bereft. CDC schemes can do this effectively as part of its longevity process. It shares the cost and though some people will pay for something that they do not need, the cost is minimal and if the pension dies with them, the sharing works in favour of other members.

We want to explain this to everyone who are in our Collective Pension Scheme and will welcome people’s view. We are a mutual and ultimately will take the views of everyone aboard and change if we see support and see that support as helpful. Please give us the support of your views on this difficult subject and thanks to Steve Webb for his eloquent introduction to the topic of “bereavement and pensions”.