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Dutch pension funds at risk of 'nationalisation', expert warns

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NETHERLANDS - Dutch pension funds are at risk of becoming "nationalised" in the wake of the Pensions Agreement between social partners and the government, according to Jean Frijns, professor of investment management at Amsterdam's Free University.

Speaking at the summer congress of IPE sister publication IPNederland, Frijns said he was concerned that politicians would become increasingly involved in the allocation of pension assets to meet national needs.

He also predicted lawmakers would aim to gain more control over pension funds' contribution and benefit policies.

Frijns said he was amazed Dutch pension funds had yet to develop a system to measure the effect of the Pensions Agreement on all generations of participants, while a large majority of attendees at IPN's congress agreed that schemes ought to take better account of the accord's impact.

The industry veteran predicted that disgruntled participants would soon be taking pension schemes to court to clarify their interpretation of the new contract.

He also argued that the transfer to new contracts had been complicated by the fact that pension asset ownership was poorly defined and therefore open to "opportunistic" interpretation.

Meanwhile, Joanne de Graaff, employers chairman at industry-wide pension fund Zoetwaren, claimed that the ongoing talks between the various generations had undermined the Dutch pensions system.

She said the creation of a more balanced Pensions Agreement had been hampered by conflicts of interest involving employer and employee representatives, as they were also involved in negotiations over labour conditions.

De Graaff also argued that, in the eyes of many pension fund board members, the elaboration of parts of the Pensions Agreement had merely served to "blur the bigger picture".
 

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