The transition to the new Dutch pension system is leading to rising costs for pension funds and pension administration organisations (PUOs), but there are opportunities to modernise systems, according to BDO Accountants & Advisors’ Readiness Pension Funds 2025 survey.

BDO reported that “costs are rising considerably” due to the transition.

Despite these challenges, however, the report found “positive noises” from those pension funds that have already switched across to the new system.

The Dutch Senate recently approved an extension of the deadline to transfer to 1 January 2028 and BDO found a “clear shift” in the sector regarding transfer dates.

Many funds first opted for 2024 or 2025 to switch, but the peak is now shifting to 2026. In addition, BDO stated that the share of funds without a confirmed transition data is still considerable.

The report found that a small proportion of the funds yet to convert (3 per cent) are aiming for 2028 and had already taken the postponement of the deadline into account. Around 2 per cent are focused on switching in mid-2027.

BDO said the delay of funds’ transition dates is due to the “care” given to the transition by those involved.

Indeed, BDO emphasised that the importance of care must outweigh speed.

BDO Netherlands director advisory financial services, Ryan de Waard, noted that the trend is visible across the industry, with frontrunner schemes saying they “look back on a carefully conducted process”. He added that “diligence also plays a role in the choice of some funds not to choose a definitive date for the conversion”.

According to De Waard, supervisors such as the AFM and DNB continue to provide “new insights”, and it naturally “takes time to process these”. He said the extension of the legal deadline to 1 January 2028 will support the sector in being able “to get this done”.

In particular, the report found that IT systems are a “source of tension” and PUOs have been advising funds to delay their switch, rather than “doing half a job”.

De Waard said: "The IT readiness and associated assurance require a lot of attention from PUOs. Of course, the reliability must be there. We hear positive reports from the sector from the first frontrunners who switched.”

Nevertheless, a number of funds have had to postpone the conversion, the report found. BDO said this puts extra time pressure on PUOs, funds and regulators to realise the switch next year or even later.

“PUOs also have to deal with considerable costs for new IT systems, which are ultimately passed on to the pension funds, De Waard said.

Despite rising costs, the report stated that the transition is an opportunity for PUOs and funds to modernise.

BDO Netherlands partner audit and assurance financial services, Werner Hoeve, explained: "Think of modernising outdated systems or simplifying complex controls. Both things help to strengthen participant communication.

“It is also clear that cooperation in the sector has improved and trust in each other has increased. Funds, PUOs and regulators are working together to achieve this. We also hear that participants themselves are asking questions about their pensions more often. The conversation between funds and participants is starting up again. That is of course a win for society as a whole".

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