Dutch minister proposes alternative way to discuss pensions

Dutch pension providers, schemes and insurers should no longer communicate about a fixed amount, but about three possible scenarios: standard, optimistic and pessimistic, according to Wouter Koolmees, Minister of Social Affairs.


The minister hopes these three area will improve pensions communication and remove as much member uncertainty as possible.

In a letter to Parliament, the Koolmees wrote: “I find it important that members receive more insight into their expected retirement income and that it is clear that this could be higher or lower. A better overview creates a clear perspective for members. That’s why I want to replace the single amount that is currently being shown on mijnpensioenoverzicht.nl as the ‘expected retirement income’ by three different amounts. These amounts will be calculated via an expected scenario, an optimistic scenario and a pessimistic scenario.”

Koolmees believes the communication will also need to give a better insight into indexation. “Many pension arrangements have an indexation ambition. But as the previous period taught us, pension funds are not always in a position to increase pension payments in line with inflation. However, the chance of no indexation in certain years is not included within the ‘expected retirement income’ calculation. For schemes with a provisional indexation, this calculation should therefore mainly be considered an ambition, and it does not give insight in the expectation that this ambition can be reached in
future.”

    Share Story:

Recent Stories


Podcast: Stepping up to the challenge
In the latest European Pensions podcast, Natalie Tuck talks to PensionsEurope chair, Jerry Moriarty, about his new role and the European pension policy agenda

Podcast: The benefits of private equity in pension fund portfolios
The outbreak of the Covid-19 pandemic, in which stock markets have seen increased volatility, combined with global low interest rates has led to alternative asset classes rising in popularity. Private equity is one of the top runners in this category, and for good reason.

In this podcast, Munich Private Equity Partners Managing Director, Christopher Bär, chats to European Pensions Editor, Natalie Tuck, about the benefits private equity investments can bring to pension fund portfolios and the best approach to take.

Mitigating risk
BNP Paribas Asset Management’s head of pension solutions, Julien Halfon, discusses equity hedging with Laura Blows