Intergenerational fairness under pressure in Dutch system, survey finds

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The principle of solidarity between pension fund participants – one of the key elements of the Dutch pensions system – is under pressure, a wide-ranging survey from think-tank Netspar has suggested.

The study, which examined behaviour and the results of a representative questionnaire about the subject, indicated that two thirds of the 6,000 respondents thought that the system was not up to scratch.

The researchers said that a “solidarity game” had shown that people were more willing to forgo on income in favour of contemporary peers than of other generations.

Just one in five respondents indicated that they were prepared to sacrifice income to help others.

The game, however, also revealed that respondents’ pessimism about solidarity wasn’t justified, as they would have received more than they expected.

Participants in the solidarity game said they were willing to share 40% of the money they received, on average. 

The researchers also found that, in the opinion of the respondents, not all age groups benefited equally from the current pensions system. Two thirds of younger people thought that the elderly benefited most.

More younger people (38%) turned out to be altruistic than older people, with 11% of older participants showing support for solidarity.

The researchers said a possible explanation could be that younger generations had more faith in institutions and politics than many older people.

They also noted that stated solidarity preferences did not necessarily reflect people’s real views on the subject “as the correlation between the survey and the experimental measures was relatively weak”.

The survey also found that older participants favoured a collective pensions system, whereas younger people preferred individual pension arrangements.

The Netspar survey was conducted by Arno Riedl and Peter Werner of Maastricht University, and Hans Schmeets of Maastricht University and Statistics Netherlands.

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