LCP webinar poll shows strong appetite for CDC schemes as member outcomes take centre stage

In a recent LCP webinar looking at Collective Defined Contribution schemes, 79% of attendees said that it was either quite or very important for sponsors, DC trustees and other key stakeholders to investigate now how CDC schemes could help their savers.

The webinar, which had over 100 attendees was held as the regulatory landscape evolves to support CDC schemes' growth, with recent consultations and legislative changes also paving the way for "retirement-only" CDC schemes expected to launch in 2027. Collectively these changes mean in future all DC trustees will likely need to consider CDC as a suitable option for their members. Sponsors in turn are likely to also take a keen interest in these decision as they consider the place of CDC in future pensions and wider reward strategies.

When asked what the priority was for a good quality pension scheme, 80% said outcomes for members was the most important thing. 7% said ease of retirement planning, 6% said ease of communication, and fairness and flexibility both came in at 4%. These are the five key criteria that LCP outlined in their recent report, The Future of Pensions? as being the key common characteristics that make up a ‘good’ pension scheme.

LCP are urging sponsors and other stakeholders to decide what sort of solution to offer based on what they think are the most important consideration for their members and savers.

When asked how important it is to investigate CDCs now, 43% said it was quite important to investigate this immediately, 36% said it was very important, 17% said they were agnostic and 3% said it wasn’t important.

Other issues discussed in the webinar include:

• As regulatory frameworks evolve, employers and trustees will need to assess how CDC schemes fit into their pension strategies. With proper design and governance, CDC schemes can significantly improve expected retirement outcomes for millions of savers, providing a secure and predictable retirement income.
• From 2027, we expect to see the first multi-employer CDC schemes emerge. In future DC trustees will also need to consider how CDC would suit their members as an accumulation option. Employers should review whether their current approach meets diverse member needs — for example CDC may suit moderate earners seeking stability, while DC offers flexibility for those with larger pots.
• CDC could transform pensions by blending the best of DB and DC. Challenges include ensuring fairness and transparency in risk-sharing mechanisms to maintain trust. Designs must address intergenerational equity and stability of pension increases in periods of adverse economic conditions. Effective communication and member education are vital for understanding CDC schemes and their benefits.

Steven Taylor, Head of CDC at LCP, said: “Our poll results were clear: member outcomes are the ultimate benchmark for success. CDC schemes will offer low and moderate earners in particular the security of a predictable income in retirement — without the complexity of managing investments. Compared to traditional DC, which prioritises flexibility, CDC can also deliver greater stability. Trustees and employers now need to ask: what matters most to your savers and members — certainty or choice?"

Helen Draper, Partner at LCP, added: “The biggest challenges for CDC are fairness, transparency and trust. Designing these schemes means balancing risks across generations and ensuring resilience against economic shocks. Strong governance and clear communication aren’t optional, they’re essential. If members don’t understand the benefits, the model won’t succeed. As more schemes explore CDC, getting these fundamentals right will be critical.”