The Co-operative Group
Pension Strategy Review Consultation
The Co-operative Group has now completed the Pension Strategy Review Consultation. The result of the consultation is that changes are to be implemented to the current pensions arrangements, affecting all members of the various pension schemes currently in operation. The changes are detailed below:
PACE (Defined Benefit) Scheme
The Co-operative Group propose to maintain the current career average pension scheme, PACE (DB), but wish to increase the employee contribution rate from 6% to 8%. As a result, existing PACE DB members will see an increase in employees’ contributions.
NACO has examined the current state of the pension scheme and the proposed changes very closely. We are assured that the continued viability of the PACE (DB) scheme is dependant upon an increased level of contribution.
NACO is concerned that increased contributions for existing members of PACE (DB) should be phased over a reasonable period to enable staff to better adapt to the added cost. We made robust representations to Group to that effect and, accordingly, Group have offered to implement the increase in two stages for all those who were members of PACE (DB) by 31st December 2011:
- 1% increase (to 7%) in October 2012
- a further 1% increase (to 8%) in October 2013
Whilst we know that any increase in pension contribution is an added burden, NACO welcomes the fact that the business will be continuing to maintain a decent, well funded pension provision; especially in the current economic climate. The employers’ contribution rate will be maintained at 16%.
NACO understands that the increase in pension contributions will be an added burden for some staff however, taking an holistic view, we recognise the business's ongoing commitment to offer good pension provision and maintain a defined benefit scheme - particularly in light of the economic conditions and the closure of many other DB schemes.
Learn More: Changes to Banking Group Pension Schemes
Colleagues in Banking Group are also subject to the changes made to the PACE (DC) Scheme. Click here to read more