Dutch Pensions Ombudsman calls on pension providers to resolve disabled pension unfairness

The Dutch Pensions Ombudsman, Henriëtte de Lange, has called on pension providers in the Netherlands to resolve the unfairness for those that are unable to work.

In the Netherlands, most pension schemes stipulate that members who become incapacitated and are unable to work can continue to accrue a pension, even if they are no longer employed. This accrual is financed by the pension provider and is called non-contributory pension accrual.

To receive this, however, the member must inform their provider that they are unable to work within a set time frame, ranging between three months and two years. As a result, many people miss out on this pension and only realise when they reach retirement.

De Lange said the issue was previously brought up by her predecessor, Piet Keizer, almost 10 years ago in his 2011/12 annual report. He had hoped that an amendment to Article 37 of the Pensions Act, in which the Employee Insurance Agency (UWV) can notify a pension provider of incapacity for work, on request, would mean that every disabled person could still accrue some form of pension.

Furthermore, since 2008 pension providers have been legally obliged to clearly tell members about non-contributory pension accrual is they become unable to work on their websites. Despite this, research by the Ombudsman shows that such information is not at the level it expects.

As a result, de Lange is calling for a “proper debate” on Keizer’s calls to repair pensions for disabled people who do not inform their pension provider in time. She believes this should also be retrospective for those who did not report their incapacity in the past, as well as for those that become incapacitated in the future.

“In this balancing of interests, funds with a low funding ratio may opt for a partial repair if this achieves justice to all interests. Any reinsurer may also be involved in this analysis. In any case, it is important that this process is completed before the transition to a new pension contract takes place,” she stated.

“Irrespective of the outcome of that discussion about the past, it must be prevented that new cases of (completely or partially) occupationally disabled people are wrongly denied non-contributory pension accrual. This can be done by obliging pension providers to work with the UWV reports as standard, and to properly inform (new) occupationally disabled persons about their right to non-contributory accrual and the options for voluntary continuation of their participation in the pension scheme if their employment ends (too early).”

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