Cuts Of Pension Rights And Benefits 2020: Granting A One-Year Reprieve

Author:Mr Robin Van Der Ham
Profession:Loyens & Loeff
 
FREE EXCERPT

Social Affairs Minister Wouter Koolmees has granted underfunded pension funds a one-year reprieve from implementing cuts of pension rights and benefits (article 142 Dutch Pensions Act). However, the minimum required funding will be 90%. If the coverage ratio is for example 87%, unconditional cuts must be implemented in order to improve the coverage ratio to 90%.

Pension funds must explain the one-year reprieve

Although the minister explained that social unrest and losing confidence in the future of the Dutch pension system must be prevented, pension funds still required to explain the one-year reprieve. They must clarify the issues of a balanced approach for all their participants and pensioners.

A balanced approach: vague standard Why?

The one-year reprieve has everything to do with the expected new pension system. This new pension contract has to solve the main funding problems of the current pension system. Is the Minster suggesting...

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