Dutch govt expected to act against looming pension crisis
Written by Jack Gray
The Dutch government is expected to take action this week to try and avoid a potential pension crisis as the nation’s pensioners face retirement cuts for the first time in 2020.
According to the Financial Times, trade union and pension scheme officials are expecting the government in the Netherlands to relax the funding rules for Dutch schemes to avoid further cuts to people’s pensions.
Although the change may only be temporary, industry professionals believe that it is an option to tackle the potential crisis.
Pension scheme funding requirements in the Netherlands have been increased as falling bond yields across Europe have been falling, to the extent where some have seen them decline to negative levels.
Speaking to the Financial Times, the Dutch pension federation chair, Shaktie Rambaran Mishre, predicted that pension contributions may have to increase by up to 30 per cent over the next few years.
“As things stand, around 2 million people are facing cuts from next year,” she said.
The Netherlands is widely regarded to have one of the best pension systems in the world, with it being placed first in the Mercer’s annual Melbourne Mercer Global Pension Index in October this year.