Dutch corporate pension funds had a good year in 2021, despite the economic uncertainties, and the big five funds are no longer threatened with having to make cuts, broadcaster NOS said on Thursday.

‘2021 may have been a difficult year for many, but it was good for ABP’s financial position,’ said Harmen van Wijnen, chairman of the giant civil service fund, which is one of the biggest in the world.

‘The coverage ratio rose in leaps and bounds and reached its highest level since 2011 by the end of the year,’ he said. ‘We can begin to think carefully about increasing pensions.’

ABP last increased its pensions in line with inflation in 2010, and the cumulative effect of consumer price rises since then is 20%.

Under current rules, pension funds can only put up payouts if their coverage ratio averages over 110% over the previous 12 months, but that is likely to be reduced to 105% in July.

The coverage ratio shows if the fund has enough assets to meet all its obligations, and funds are supposed to make cuts if the ratio drops below 100% for a time.

Health service fund PZW is also looking at possibly index linking pensions again, NOS said.  The two big engineering sector funds are in a similar position.

The standout fund is the construction industry fund Bpf Bouw which has a current coverage ratio of 125% and has index linked payouts every year apart from 2021. It will put up payouts 1.76% in 2022, NOS said.