Civil service pension fund sees lower pension for youngsters

The new cabinet’s plans for corporate pensions will make it more difficult for youngsters to build up a pension equal to 70% of their average salary, according to the giant ABP pension fund, quoted by news agency ANP.

The coalition accord states that from 2014, the annual pension build-up is to be cut by 0.4 percentage points to 1.75% for workers building up a company pension based on their average wage.
But over a 40-year-period this reduction will lead to a 20% cut in the size of the individual fund, meaning there is less money to pay out, ABP says. And that will make it more difficult for youngsters to build up the same sort of level of pension as current pensioners enjoy, the civil service fund states.
The agreement also states that pension premiums will no longer be tax deductible on income above €100,000. ‘If these limits are moved again in the future, it will threaten the system,’ ABP told ANP.
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