I think this a curious opinion piece to offer readers this week; three reasons to be mystified by the appearance of John Ralfe’s opinions again;

1. It is based on an assumption that collective pensions are unfair to youngsters; this is a very old criticism that has been addressed by the DWP and the Pensions Regulator.
2. It is labelled an article about personal pensions , which collective pensions clearly aren’t
3. The argument that what is happening today is “something new” is to ignore what has been going on for some time

We do need a grown up conversation about how DC pots can turn to pensions , indeed contributions to buy pension, but this article is not based on the facts of the development of CDC as a choice for employers and DC trustees.

To argue that what happened with the publication of two consultations on a form of Collective (CDC) Pension last week, was something new for  Government is wrong. It just is not true.

A new Retirement CDC was consulted on from October 2025 and won’t be available to the middle of 2029. Meanwhile the single employer CDC plan went live for Royal Mail in 2024 and the multi employer scheme a the end of July this summer. It is curious that the FT publish suggests that CDC is something new. Opinion is one thing but misinformation another!

Calling what is now known as a Retirement Collective Pension Scheme (RCPS) to be  the Government’s preferred default is wrong. What the new consultations were recently about was a new way for DC schemes to turn DC pots to pensions.  RCPS was one choice but not the default – the choice of default is down to the trustees and the choice of workplace scheme is down to employers. Members approaching a stated retirement age can opt-out of whatever has been chosen as the pension.

Again there is “opinion” but it should be backed up by an understanding of what is happening.  To the question “what is happening”, the short answer is that nothing is happening on the choice framework and the default til we get changes in legislation and regulation. John Ralfe can have his say in the consultations going forward that focus on RCPS and the framework for it and other choices (Guided Retirement).

There is a lot in John Ralfe’s opinion piece about how he thinks collective pensions work. The information is freely available to employers, their unions and their advisers. He can make his judgements on how collective pensions have progressed since the first CDC legislation in 2021, the second in 2025 and the third , likely to be in 2028.

What might work for Royal Mail and its workforce will not work in the same way as the workplace (UMES) CDC schemes for employers wanting to join a multi-employer pensions.  There’s no doubt that RCPS schemes turning DC pots to pensions, will work differently from single employers and UMES. Again the article implies that CDC is one scheme. As with defined benefit and defined contribution pensions, collective pensions will provide alternatives to meet different needs.

A great number of employers will not choose to switch to a collective CDC pension. They will have to offer a default means for DC members reaching retirement to turn pots to pensions, many varieties are being touted including drawdown turning to annuity and variants. RCPS is another option that can be offered as a choice or as the default by the workplace scheme and by most personal pensions.

Those employers that choose to use CDC as a workplace pension or fiduciaries choosing to use if to turn pots to pensions at retirement are likely to do so with a lot of care. Were it considered unfair to youngsters that those drawing pensions do so at their expense then the Pension Regulator would not authorise the collective pension. Once authorised the employer will due diligence with help from experts and it will only switch to collective  pension when consultation with members and their representatives has been completed.

Again, John Ralfe must make it clear what is happening and not argue that successive Governments have been trying to turn “base metal into CDC gold”. There is no reason for both Conservatives and Labour to come to the same conclusion over collective pensions lightly. There is no conspiracy against DC pots, they can carry on as DB pensions carry on.

It is hard to see what drives John Ralfe to continue to repeat an article he’s been writing for ten years and no reason for the FT to tolerate misinformation There is an opportunity for the FT to publish the views of an authority such as the Pensions Minister and I hope we will hear a different view shortly. Pensions are changing and many think they’re changing for the better.