Government to set out plans for collective DC pensions

The government’s report on defined ambition pensions, which is expected this summer, will set out plans to introduce collective defined contribution (DC) pension schemes in the UK.

The Department for Work and Pensions (DWP) has confirmed that pensions minister Steve Webb (pictured) has met with large employers that have expressed an interest in shifting to a collective scheme.

In an interview with the Financial Times, Webb said he wanted to see the government facilitate more collective DC schemes.

Speaking at the Employee Benefits Pensions and Workplace Savings Summit on 1 February 2013, David Pitt-Watson, lead for the Tomorrow’s Investor programme at the Royal Society of Arts and author of Building the consensus for a people’s pension in Britain, said that the future success of the UK pensions market requires a move to collective-based pensions.

He said: “What we should do is take our money and put it in great big giant pots where we share the risk of longevity.”