The Government has issued two consultations today (and a response to a consultation on R-CDC now more than a year old).

We are being asked to compare and contrast two methods of offering decumulation of a pension pot , one that preserves the freedom of owning a pot of money, one that swaps pots for an irrevocable pension.

This blog looks at what the 49 responses to the first consultation thought.

It will now be necessary for commercial DC master trusts to offer a framework called guided retirement in which what was called R-CDC and is now called Retirement Collective Pension Scheme (RCPS), can sit as the default or as an option..

The DWP views expansion of RCPS to a retail market, where individual savers choose pensions, as a potential option for the future but out of our immediate scope. This may be something that could be explored in the future if there is demand.

L&G chief executive of retail Laura Mason told Professional Pensions that while L&G welcomed the government’s focus on helping savers turn their pensions into a sustainable retirement income, there is “no one-size-fits-all solution” and that guided retirement will need to combine increased support with flexibility and choice.

“A RCPS could be a valuable part of that landscape, but it is one option rather than a predetermined default. By pooling longevity risk and managing investments collectively, it has the potential to deliver higher expected incomes while taking complex decisions out of people’s hands.

“But higher expected income isn’t free. CDC involves investment risk and, unlike an annuity, income isn’t guaranteed. The goal is to help each member find the right balance for them between income, flexibility and certainty.”

The Guided Retirement framework offers a DC scheme to offer access to someone else’s CDC scheme as an option – this puts it in the same place as the annuity purchase. Whether DC schemes will offer it is of little importance if it gets limited take up and allows the DC scheme to focus on in-house options such as “flex and fix“.

The choice for employers will be to to stick with the DC scheme and accept the Guided Retirement offered, switch the DC master trust to get the Guided  Retirement wanted or transfer to a workplace CDC that’s there for the saver’s whole of life.

The responses to the original consultation of R-CDC suggested that R-CDC would be underwritten and not generally available

2.28. Several respondents suggested that a minimum pot size will be required. A small number of respondents suggested the minimum pot size should be in the £20,000 – £30,000 range. However, some responses suggested that average pot size within the scheme would need to be higher, around £100,000.

The Government is aware that there is concern that opening the door to existing trusts could be a problem for proprietors of retirement schemes and are consulting on whether to have a minimum transfer into the collective plan

The government has published a consultation on Guided Retirement policy which is seeking views on the minimum viable pot size for providing a regular income in retirement

Master trusts worried about not achieving scale requirements will not be able to get round “scale” by having a collective pension in its Guided Framework.

RCPS are outside of the scope of the measures, as the requirement is intended for accumulation-phase auto-enrolment schemes rather than decumulation-only arrangements. For Master Trusts who have a RCPS, the £25 billion requirement will apply to the main default arrangement used for automatic enrolment accumulation.

Irrevocability on RCPS collective pensions looks a serious worry for those running them as members finding they are in ill health or see their income going down will have a year to reverse out, on what terms they can get out is another matter.

The government is minded to allow a period of up to one year in which a member may convert their RCPS pension to flexi-access drawdown. Further details relating to this proposal are set out in the Autumn Budget 2026^{[footnote 8]} and the Pension Schemes Newsletter 186^{[footnote 9]}.

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This feedback on how RCPS should develop sheds some interesting light on transfers into workplace pension collective pensions;

3.18. We do not intend to place any legislative barriers in our regulations that would prevent people in FCA-regulated schemes from accessing RCPS via Guided Retirement. Section 58 of the Pension Schemes Act … will enable the FCA to use its general rule-making powers to make Guided Retirement rules to facilitate this.

3.19. In response to questions about access for SIPP holders, our policy intent remains that access to RCPS will only be available through Guided Retirement. Accordingly, SIPP members will only be eligible where their SIPP falls within the scope of Guided Retirement under the Guided Retirement provisions in the Financial Services and Markets Act 2000 (inserted by the Pension Schemes Act 2026) and FCA Guided Retirement rules. We will work together with the FCA to develop this thinking further in future. For our full position in respect of retail access, please refer to our response to consultation Question 3.

3.20. In relation to comments raised regarding Consumer Duty, we note that members are already subject to a range of existing protections in the trust-based regime. These include trustees’ fiduciary duty, supported by TPR’s wider regulatory powers, as well as the authorisation and supervisory frameworks in place for Master Trusts and CP schemes. Where responses raised that there may be legal and operational issues when transferring from a contract, this is being considered as part of the wider work on Guided Retirement and transfers between contract and trust-based schemes, which is discussed in the last section of chapter 4 in the Guided Retirement consultation. Views in response to the relevant question in this section of the Guided Retirement consultation are being welcomed.

3.21. Responses suggested that contract-based schemes should be enabled to develop their own RCPS, however this is outside the scope of the Pension Schemes Act 2021, which defines a qualifying scheme as a trust-based occupational pension scheme: s 3 PSA 2021.

3.22: Separately, we note that many Master Trusts are sponsored by providers that also operate FCA-regulated schemes. This common provider may make it relatively straightforward for members to access RCPS within the same organisation.