Minister to publish pension plan next week, most funds will avoid cuts

Photo: Arenda Oomen via
Photo: Arenda Oomen via

Social affairs minister Wouter Koolmees will tell MPs next week what he intends to do to help pension funds avoid reducing pension payouts next year, sources have told the NRC.

Opposition parties GroenLinks and Labour, and the FNV trade union federation, have said they will withdraw their support for plans to reform the Dutch pension system if the government does not give assurances no pension will be cut in 2020.

A number of funds have warned that pension cuts are likely under current rules. And central bank president Klaas Knot has also said cuts cannot be avoided without passing the risk on to younger generations.

In June, unions, ministers, political parties and employers agreed plans to overhaul the Dutch pension fund system, which would reduce the pressure on funds to keep their assets topped up.

That new system is due to come into effect in 2022, meaning the funds have two years to bridge before they face more relaxed financial requirements.

Despite Koolmees’ willingness to reach an agreement on pension cuts, some funds will have to reduce payouts because their assets only amount to 90% of their obligations, the NRC said.

However, the risk that the big four funds, including the giant ABP civil service union, will have to make cuts will be removed when Koolmees makes his statement, the NRC said.

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