Pension funds to get more time for buffers

The cabinet will today vote on allowing some of the country’s biggest corporate pension funds more time to restore their financial buffers to within the recommended levels, report several newspapers, quoting sources in The Hague.

Social affairs minister Piet Hein Donner wants to increase the recovery period from three to five years on condition that the funds freeze the level of pension pay-outs for the same length of time.
Ministers are expected to back the extension and the freezing of corporate pensions, the Volkskrant says.
The central bank would assess which funds are eligible for the longer recovery period, the paper says.
Around half of the country’s pension funds, representing 85% of the workforce, have been hit by the decline in share prices.
Funds are supposed to have reserves equal to 105% of their pension obligations, but many have fallen well below this level.

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