The Dutch pension system has been on the brink of a large-scale overhaul for five years now. In 2009 the government postponed a wholesale revision of Dutch second- pillar pensions with two major studies into the sustainability of the Dutch second pillar. Their findings led to a slew of reform proposals – some sensible, some outrageous, all contentious.

At first it seemed the Dutch might be headed for a pension contract that marries a guaranteed layer of basic, no-frills benefits to a top-up of extra benefits conditional on pension funds’ financial health – a so-called ‘combi-contract’.

This idea then faded from view and the social partners instead embraced ‘defined ambition’– a contract retaining the core values of solidarity and collectivity, while making the actual pension outcome conditional on investment performance.

The concept of an insurance-like base layer was dropped. Studies showed that real, conditional schemes offer the best chance of realising an optimal pension outcome, while benefit cuts would be fairly limited in scope. A new super visory regime, it was thought, should still leave room for die-hard schemes insisting on nominal arrangements. But the majority of pension plans were expected to migrate to defined ambition, which would ideally base its discount rate on prudent return expectations.

The new proposals were enshrined in another agreement in 2011. Within weeks this second ‘pension deal’ ran into trouble as two of the larg- est trade unions lambasted the accord, calling the proposed system ‘casino pensions’. Also, no one had a clue how to migrate past accrued rights to the new system. So, back to the drawing board.

When a new pension framework was finally consulted on last year, it became clear that few really wanted a dual framework – allowing for both nominal and real, conditional schemes – after all. Back to the drawing board, yet again.

And, finally, after five years, on 4 April the state secretary for pensions, Jetta Klijnsma, presented draft legislation for a new FTK.

The long-awaited new pension framework offers no sweeping changes or fundamental reforms. No defined ambition, no separate frameworks for nominal and real pensions. It simply makes a few sensible, straightforward improvements to the current regime, mainly smoothing downside shocks by allowing benefit cuts to be spread over time, and curbing upside hand-outs by limiting overly generous and pre- mature indexation payouts.

But this is just a temporary fix, Klijnsma has emphasised. The real fundamental reform is yet to come, because, you guessed it, the pension system is on the brink of a large-scale overhaul.