A surge in interest for 'Dutch-style' pension schemes is emerging in the UK, with over 200 employers keen on a new multi-employer collective defined contribution (CDC) scheme. TPT aims to launch this innovative scheme by 2026, which is projected to provide retirement incomes 20 to 50% larger than existing defined contribution plans without increasing contribution levels. This movement follows Royal Mail's introduction of a single-employer CDC scheme, seen as a pivotal change amidst industry debate over its potential risks and structural weaknesses.
"CDCs could generate pensions that are 20 to 50 percent larger than standard DC schemes - all for the same contribution levels and risk profile."
"While proponents have described CDCs as 'one of the greatest innovations in UK pensions in generations', critics warn of flaws in the underlying business model."
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