Dutch sector funds' 106% cover
The Dutch sector wide pension fund association says pension funds in the Netherlands have an average coverage ratio of 106.5% – and that they have E17bn euros more than they need to meet their financial obligations.
The Vereniging van Bedrijfstakpensioenfondsen says it has surveyed 58 of the 83 its members and found that as of January 1, their coverage ratio – the ability of a fund to meet its financial obligations – was such that the Dutch pension industry is able to “fulfil all its nominal pension obligations”. “The average coverage ratio of these funds is 106.5%,” the VB said.
The 58 funds have E280bn in assets and represent 98% of the total corporate pension market, the VB said, adding that they have E17bn more than needed for their obligations.
The statement is a clear response to a demand by the Dutch pensions regulator, the Pensioen & Verzekeringskamer, that the third of Dutch funds whose coverage levels had fallen below 100% should rectify the situation.
In January the VB joined the other Dutch pension bodies OPF and UvB in calling the PVK’s letter on coverage ratio’s “unnecessary and bad for the economy”. They said there was a real danger that the move would in many cases transfer more risks to employees.
The three organisations invited the PVK to resume talks, saying that pensions are at a good level and can be paid, both currently and in the future.