ANWB proposes 'creative' plug to pensions gap
NETHERLANDS - ANWB, the executive body of a motorists' lobbying organisation, has proposed to plug the financial hole in its pension fund with an agreed 3.3% salary increase.
"We believe that the company, workers and pensioners should contribute in equal measure to the funding deficit of the pension scheme which has a cover ratio of 85% at present," said Ad Vonk, spokesman for ANWB.
Proposed measures within a four-year recovery plan to lift the fund's cover ratio above 125% consist of a contribution of around €35m by the company along with the expected combined salary increase to employees worth €23m.
Vonk also indicated the ANWB's pensioners are likely to contribute to the recovery plan by by foregoing indexation over the next four years.
Frans Prins, director of the Foundation of Company Pension Funds (OPF), described the proposed solution as unique and creative, adding: "The ANWB pensions will not become more expensive, but the cover ratio will be improved."
That said, workers must first agree on the executive's proposal before it can be put to pensions regulator DNB.
The large union FNV Bondgenoten has already made clear that it wants to look at all options for improving the financial position of the pension fund.
"In principle, we don't want to undo salary rises that have been agreed as part of a collective labour agreement," said Ralph Smeets, governor at FNV Bondgenoten.
"Moreover, we want to be cautious because any arrangement is likely to set a precedent for other companies," he added.
The ANWB pension fund has approximately 9,000 participants, of whom 4,530 are workers and 1,360 are pensioners.
The scheme had €198m in assets under management at the end of 2007, when its cover ratio was 141.4%, and returned 1% on its investments in 2007.
If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email firstname.lastname@example.org