Co-op closes older pension schemes but promises increase in contributions

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Co-op closes older pension schemes but promises increase in contributions

Wed 20th Jul 2011

A proposal from the Co-operative Group intends to close smaller group employee pension plans and transfer them to larger existing group schemes.

The move follows the merger of smaller cooperative societies with the Group between 2006 and 2009.

However, it is understood the proposal seeks to offer affected members the chance to join the group's existing employee pension scheme, based on average career earnings (PACE).

USDAW national officer Sharon Ainsworth said the union welcomed "Co-op's ongoing commitment to their existing defined benefit scheme which is actually more generous than some of those earmarked for closure".

The group has also proposed that as part of this plan, it will increase employee contributions from six to eight per cent of earnings from April 2012.

Ainsworth conceded: "It would be unrealistic to expect them [the Co-op] to continue operating such a myriad of different pension schemes."

People wishing to take out a pension should think about using a pension calculator to help consider their options. The Co-op also offers a series of pension schemes for both individuals and employees outside the company, including individual and group stakeholder pension plans.

Click here for pensions calculator.

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