The pensions industry has welcomed the introduction of regulations for multi-employer collective defined contribution (CDC) arrangements, with the focus now shifting towards implementation.

Regulations to enable unconnected multi-employer CDC schemes came into force today (31 July), as set out in the government’s workplace pensions updated roadmap.

The government laid the regulations for multi-employer CDC arrangements in October 2025, aiming to allow the expansion of CDC schemes to more employers.

“Today’s announcement is a landmark moment for UK pensions and a major step towards making CDC a reality for millions more savers,” said Aptia strategic adviser and former Pensions Minister, Guy Opperman.

“CDC has the potential to be a game-changer, offering significantly improved member outcomes and greater income stability in retirement at a time when many people are worried about their financial future.

“We know this is a real concern as recent research carried out by Aptia found that 70 per cent of people approaching retirement are concerned their pension savings will not keep pace with the cost of living.”

Opperman argued that the focus must now be on turning the promise of CDC into practical, trusted solutions.

“That means building awareness and understanding, delivering clear and engaging member communications, achieving the scale needed to maximise value, and maintaining strong governance,” he continued.

“If government, regulators and the pensions industry work together, CDC can become a mainstream feature of the UK retirement system and help deliver brighter futures for generations of savers.”

Meanwhile, Festina Finance UK country head, Dan McLaughlin, said while much of the discussion around CDC to date had understandably focused on regulation, governance, and scheme design, a framework alone would not deliver successful outcomes unless equal consideration was given to how CDC will operate in practice.

“As CDC moves from policy development towards implementation, the focus must also turn to the operational foundations needed to support schemes effectively,” he stated.

“High-quality data, robust administration processes and flexible technology infrastructure will be critical to managing complex calculations, supporting effective decision-making and communicating clearly with members.”

McLaughlin noted that recent surveys had indicated a growing interest in CDC arrangements, but also a degree of caution.

“CDC has the potential to become a credible third way between traditional defined benefit and DC models, providing the industry with an exciting opportunity to rethink how retirement outcomes can be delivered,” he added.

“However, getting the operational foundations right will be essential to building confidence among trustees, employers and members.

“The broader industry has seen how transitioning to a new system or product can create systemic risks.

“The right technology and operational capability will help schemes manage CDC effectively, adapt as requirements evolve and ultimately realise the full potential of this new model.”

Hymans Robertson head of DC markets, Paul Waters, described the opening of the authorisation process for multi-employer whole of life CDC schemes as a “major and welcome milestone”, and as one of the “most significant innovations” in pension provision for many years.

“CDC can play a meaningful role in addressing the significant challenge of retirement adequacy,” he continued.

“By pooling longevity risk and investing collectively, it offers the prospect of higher retirement incomes than other DC alternatives, alongside a simpler member experience with fewer complex decisions at retirement.

“The trade-off for this is typically less flexibility, or the ability to pass on a legacy if you die.”

While Waters acknowledged authorisation was an important step, he noted that the long-term success of CDC will ultimately depend on how schemes are designed, governed and operated in practice.

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