Pension funds which do not meet the central bank’s rules on assets must reduce pensions to head off further problems, social affairs minister Henk Kamp told parliament on Tuesday evening.

Kamp was speaking during a debate on the pension crisis which has left hundreds of thousands of pensioners facing lower pay-outs next year. The biggest engineering fund, for example, is considering cutting pensions by 6% to 7% if the economy does not recover.
The central bank has said pension funds which do not have enough assets to cover their obligations will have to reduce pensions by a maximum 7%. This is to ensure younger generations are not left with an empty fund.
Problems
The central bank is sensible to insist on this, Kamp told MPs. ‘We must not simply push the problems along in front of us,’ he said.
MPs from the Socialist Party and anti-Islam PVV are opposed to cuts, saying pensioners are being punished for the economic crisis.
Employers organisation VNO-NCW is also opposed, saying lower corporate pensions will further damage weak consumer confidence, Nos television reports.
Agreement
Kamp also told MPs the agreement on changing the supplementary pension system worked out last year by employers, unions and ministers could help funds deal with the shortfalls.
The agreement, which gives greater control to unions and employers in determining pension levels, will not become law until 2014.
However, Kamp said if there is enough support, some of its provisions could be used when the financial state of pension funds is looked at again in detail at the end of this year.