NETHERLANDS - Two Dutch MPs have put down a joint written question to pensions minister Aart-Jan de Geus about the implementation of guidelines covering retirement benefits accounting standard IAS19.
“We fear that as these are translated into Dutch norms the intended exemption for industry-wide pension funds is sufficient, whether it will be translated fully into the Dutch version and whether it will be applied in the proper,” said Pieter Omtzigt, one of the two MPs.
The MPs’ move comes as the Netherlands Council for Annual Reporting (CAR), the Labour Foundation representing Dutch central employers and employees’ organisations and the Dutch Association of Industry-wide Pension Funds (VB) have demanded that industry-wide pension schemes be exempt from the requirement to apply defined benefit accounting standards to the companies within such schemes.
“We want to know whether it will be possible for Dutch industry-wide pension funds to keep on offering defined benefits,” said Omtzigt.
“It is feared that the new rules will require that the pension funds’ profits and losses be attributed to the individual participating firms. Not only would that be difficult in accounting terms but it could also cause profits and losses of quoted companies to fluctuate wildly.
“More importantly, we could very rapidly lose the defined benefit schemes that we have in most industry-wide funds, and move to defined contributions schemes.
“So I want to be assured by the minister that even after the new IAS19 rules have come into force, after they have been translated into Dutch and after the accountancy firms have set the rules that these industry-wide schemes will still be able to continue with their present accounting methods, which means that profit and loss in the pension funds will not be pushed through the profit and loss accounts of the participating firms on an annual basis.”
The urgency felt over the issue is reflected in the fact that the other question was put down by Staf Depla of the opposition Social Democrats (PvdA) while Omtzigt is a deputy for the Christian Democrats (CDA), the largest party in the governing coalition.