Ministers are working on plans to force pension funds to lower their premiums, which they hope will win opposition support for a more sober corporate pension system.

The Volkskrant reports on Tuesday that the change is being considered because ministers have not won majority support for their proposals in the upper house of parliament.

Senate support is essential because the changes are due to generate savings of €3bn by 2017 for the treasury – almost half the cuts necessary to get the budget deficit under control.

Talks

Finance minister Jeroen Dijsselbloem held talks with leaders of five opposition parties on Monday evening in an effort to win backing in the senate.

The government wants to reduce the amount workers can put tax free into corporate pension schemes from 2.25% of their gross salary to 1.85%. They also plan to limit the tax break to income under €100,000.

Protests

But opposition parties, pension experts and the Council of State have criticised the plan, saying it will be impossible for youngsters to build up a proper pension.

Opponents also doubt government claims that pension funds will cut their premiums in response.

Pension funds have said this is unlikely because they have been hit hard by falling interest rates and the financial crisis and have been struggling to boost their assets to legally required levels.