The Collective Plan’s Handbook

How the Collective Plan works

First things first: how does the Collective Plan work, and what
do you need to pay?
The Royal Mail Collective Pension Plan is a tax registered scheme with HMRC.
For most, once you’ve been working for Royal Mail for a year, you’ll join the Collective Plan (but there are
some exceptions, which are detailed on page 20). This should happen automatically without you doing
anything, but if you think it may not have been done, contact Royal Mail’s HR Services.
For a full breakdown of how your and Royal Mail’s contributions are allocated, see page 23.
All of that is then pooled with everyone else’s money, and it’s all invested together
.
You’ll pay in 6% of your Pensionable Pay This is based on your basic pay, plus any payments, allowances or bonuses that are counted. You have the option to pay an additional 1% of your pensionable pay to boost your lump sum
.
Royal Mail pays in 13.3% of your Pensionable Pay + Royal Mail pays 0.3% of your pensionable pay  towards ill health premiums – anything left over from this is paid into the Collective Plan.
If you pay the 1% booster contribution towards your lump sum, Royal Mail will also pay 1% more.