Dutch health service pension fund Zorg en Welzijn is to stop investing in hedge funds, the NRC reports on Friday.

The fund, the second biggest in the Netherlands, said the investments are not only expensive and complex, but do not generate sufficient returns.

In addition, the pension fund criticised ‘the high levels of remuneration in the hedge fund sector and the often limited attention to social and environmental issues’.

Zorg en Welzijn had 2.5 million members and €156bn in assets at the end of last year.

At the end of 2013, the fund had money in 40 hedge funds including Blackstone, Oaktree, Cerberus and Harbinger, although they only represented 2% of its total investment.

Dutch pension funds had €28bn invested in hedge funds in the third quarter of last year, the NRC says.