Pension fund recovery plans under fire
Dozens of pension funds have been ordered to supply extra information about plans to bolster their assets which have fallen below the legal minimum, the Financieele Dagblad reports on Thursday.
The paper says officials from the Dutch central bank are particularly concerned about the way funds have calculated the effect of pay rises, the paper says.
Some 350 of the Netherlands’ 650 pension funds had to come up with a recovery plan after their assets plummeted because of the financial crisis. Funds are supposed to have a coverage ratio of at least 105%, meaning they have enough funds to cover all their obligations, with 5% leeway.
Many of the recovery plans are based on wage increases of below 3%, but the bank says funds must assume wages will go up by at least 3% in their calculations.
The paper bases its claims on interviews with actuaries who have advised the funds. The central bank refused to say how many recovery plans have been criticised so far.
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