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Saturday 23 June 2018

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Spring Conference

Dutch parliamentary questions on pensions carve-out

Written by Tineke de Vries
24/11/17

Two Dutch political parties, the liberal VVD and the Labour party, will ask questions in parliament about barriers in the Pension Law to a so-called carve out, the transfer of a part of the pension liabilities to another pension provider, such as an insurer.

Pension funds could for instance transfer only pensioner members, whereby the other liabilities (deferred and active members) remain with the pension fund.

But due to the current Pension Law, pension funds can get into trouble if they transfer pensioner members to an insurer and that insurer would then like to give a pension increase to those pensioners.

The Pension Law dictates that if the new provider of the transferred pension rights provides an increase to the pensioners, the old pension provider will need to provide at least the same increase on the pension rights of the remaining deferred members.

In case the old pension fund has a funding ratio between 100 per cent and 110 per cent, then the deferred members are in a pension fund that based on its funding ratio is not allowed to provide pension increases. Strict adherence to the law means that if deferred members do not receive an
increase, pensioner members are not allowed to receive one either.

Helma Lodders (VVD) and Gijs van Dijk (Labour) will ask Social Affairs Minister Wouter Koolmees if he is prepared to remove these barriers in the Pension Law. The members of parliament also want a framework to assess a balanced representation of interests of groups of pension fund members.



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