Dutch notaries and pharmacists face pension cuts
NETHERLANDS - Approximately 5,000 participants of the pension fund for notaries could face an 8.4% cut in pension benefits and claims by 2012, while members of the SPOA scheme could see reduced pensions too.
A spokesman for the €986m Stichting Notarieel Pensioenfonds told IPE: "Factoring in a future cut is less difficult than the alternative, which is a 20% rise of contributions that has to be implemented with immediate effect."
The occupational pension fund saw its cover ratio drop to 85.4% at the end of 2008 and its recovery plan, which has been approved by pensions regulator De Nederlandsche Bank, showed a recovery plan is unlikely to meet the required funding ratio of 105% within five years without additional measures.
Elsewhere, the €930m occupational scheme for pharmacists (SPOA) said it may need to implement a 5% cut in benefits and claims for its 3,700 participants, based on the scheme's cover ratio of 86.1% reached at the end of last year.
"However, we are hoping that a cut in benefits and claims will not be necessary, given the gradual improvements we have seen during the past months," said a spokesman for SPOA who pointed out its cover ratio has increased to 90% since then.
Whereas DNB has approved SPOA's recovery plan, the €3.2bn pension fund for sheltered workshops is still waiting for a decision on proposals to increase its cover ratio from 90.3%, according to a spokesman.
The industry-wide Pensioenfonds voor Werk en (re)Integratie has proposed it will deploy the funds it has generated by charging more than cost-covering contributions.
In addition, it wants to return to its strategic asset mix during the next five years, as an asset-liability study has shown that the expected returns on investments will gradually rise from 5.6% to 6.3%, according to officials.
The scheme's present allocation to equity and fixed income is 23.1% and 59.2% respectively, whereas its strategic asset mix is 36.5% and 39.8% respectively.
"It will be difficult to explain to our participants that a cut of benefits and claims is reduced because of better results than anticipated. This will not offer better results than a cut later on," explained the scheme in its recovery plan.
For the time being, however, the scheme for sheltered workshops - which has 218,000 participants - is not considering raising contributions, nor granting any indexation, it said.
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