Funded occupational pension schemes sit “precisely at the intersection” of Europe’s two structural challenges, ageing populations and an investment gap, according to the Dutch Federation of Pension Funds (Pensioenfederatie) chief executive, Edith Maat.

During a meeting with members of the European Parliament, Maat highlighted how pension funds can provide adequate retirement income, while also mobilising long-term capital for the European economy.

As a result, Pensioenfederatie “strongly” welcomes the European Commission’s (EC) supplementary pension package aimed at expanding capital-funded pensions in Europe, adding that the Dutch pension system already delivers on both of Europe’s challenges.

She noted how collective participation in the Netherlands has provided scale: Dutch pension funds invest a total of €1,700bn, representing more than 150 per cent of the country’s gross domestic product (GDP). Maat said that this scale keeps costs low.

Secondly, she praised the role of social partners, where employers and employees jointly design and govern pension schemes.

“This aligns the interests of the scheme with its members and beneficiaries. It also ensures long-term stability and trust in the system. This combination has delivered strong outcomes: relatively high replacement rates, cost efficiency, and well-diversified portfolios,” she noted.

Regarding investment, she stated that with liabilities that stretch over decades, pension funds can invest in illiquid assets and highly diversified portfolios such as infrastructure, private equity and private debt.

These, she said, are “essential for Europe’s future” but require “patience and stability”. Therefore, she called on action from both member states and the EU to “fully unlock this potential”.

At the member state level, the priority should be on expanding funded occupational pensions, noting that the EC’s recommendations “provide a solid roadmap”.

“Tools such as auto-enrolment, pension tracking systems, and pension dashboards can significantly increase participation and transparency. We encourage the European institutions to actively promote and monitor the implementation of these recommendations, while fully respecting national competences and the role of social partners,” she said.

At the EU level, Maat highlighted the IORP II Directive review as being “crucial”.
“It must deliver a framework that enables – rather than constrains – the role of pension funds,” she said.

She highlighted a modernised prudent person principle with a genuinely risk-based framework to allow pension funds to invest in a broader range of assets.
Secondly, she said disincentives for long-term and alternative investments should be avoided.

She noted: “While we support the objectives of the SIU, some elements of the IORP2 proposal risk pulling in the opposite direction. In particular, the proposed approach to benchmarking could discourage investments in illiquid and innovative asset classes.

“Short time horizons and rigid benchmarks tend to incentivise ‘benchmark hugging’— reducing risk-taking and limiting diversification. This would be counterproductive to the objectives of the Savings and Investment Union.”

Finally, Maat said excessive regulatory burden and rules that are not fit-for-purpose should be avoided.

“Occupational pension systems are not retail financial products. They are collectively organised, not-for-profit schemes, governed by social partners. Some elements in the proposal – such as a general duty of care and the mandatory appointment of a depositary – risk duplicating existing governance safeguards.

"This would increase costs and complexity, without clear benefits for members,” she concluded.

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