Reed Elsevier pension fund to merge with Dutch printing scheme PGB
The €800m Dutch pension fund of publishing company Reed Elsevier (SPEO) is to liquidate itself and join PGB, the €20bn scheme for the printing industry, at year-end.
In a letter to its participants, the board said it took the decision following a survey on its future, which concluded that continuing as an independent scheme would not be in its best interests.
It said the number of active participants in the relatively small scheme was decreasing, which would lead to falling income from contributions while costs continued to rise.
According to the pension fund, the employer agreed with its central works council (COR) to introduce a new pension plan that the scheme could not implement properly.
The company, which declined to reply to questions about the details of its new scheme, has been pushing for individual defined contribution arrangements since 2013.
The Stichting Pensioenfonds Elsevier-Ondernemingen has 1,700 active participants, as well as an equal number of pensioners.
The scheme’s board and the employer have been at loggerheads over future pension arrangements for some time.
The employer – recently re-named the Relx Group – had indicated for several years that it wanted to get rid of its Dutch pension fund.
SPEO’s proposals to introduce collective defined contribution arrangements were rejected by the company, which argued that this would not fit witin its human resources policy.
Funding at the Elsevier scheme, 97.1% at the end of July, is lower than PGB’s coverage, which stood at 103.1% at August-end.
However, according to the board, the employer has promised to plug the funding gap at the end of this year.
Filling the current difference in coverage would require an additional contribution of €50m.
The pension fund said it refrained from placing its pension plan with an insurer, “as this would be too expensive”.
It added that it had also been in merger talks with another industry-wide scheme.
However, it declined to reveal the pension fund’s name.