€900m shipping scheme’s future in doubt as employer engagement wanes
The future of the €900m Dutch mandatory pension fund for the Rhine and inland shipping could be in jeopardy if it fails to increase support among employers in the sector, according to the pension fund.
In its annual report, it said that less than 41% of its participants were employed by firms affiliated with employer organisations. Under Dutch law, at least 50% is required in order to keep the scheme’s mandatory status.
The Bedrijfstakpensioenfonds voor de Rijn- en Binnenvaart said the Netherlands’ ministry of social affairs was likely to revoke mandatory participation if employer support hadn’t improved by May 2020. Currently all employers in the inland shipping sector must participate in the scheme.
Hylke Hylkema, the scheme’s chairman, said that employer support was a matter for unions and employers to discuss, but he warned that the pension fund did not see the point of continuing independently if it became a voluntary industry-wide scheme.
“There is a fair chance that many employers would leave, which would render us too small,” he explained. “Without mandatory status, there is no future for the pension fund.”
Hylkema said there was no precedent for the withdrawal of a pension fund’s mandatory status, so the scheme did not know how this would pan out.
“However, we know that [the ministry] would consult supervisor De Nederlandsche Bank and that it would be a careful process,” he added.
At the end of 2017 the pension fund had approximately 5,000 active participants and 2,800 pensioners. Its funding stood at 119.7% at the end of last month.
The sector has been suffering from a low level of engagement from employers, most of whom are small companies with few staff.
The ministry of social affairs, which oversees pension legislation, can withdraw a scheme’s mandatory status if the percentage of members employed by firms affiliated with employer organisations is between 50% and 55%. It can also refrain from this if there are sound reasons.
In 2014, the Rijn- en Binnenvaart scheme’s representation level was 52%, but the ministry agreed to extend its mandatory status because the previous economic crisis had forced employers to economise on memberships. It also cited a merger between employer organisations.