NETHERLANDS - The Dutch Pension Agreement negotiated by the social partners and the government could be in jeopardy after the country's largest union of FNV Bondgenoten rejected the accord.

Although only 23% of the union's 475,000 members participated in the poll, 96% of those who did vote rejected the agreement.

The outcome is a serious setback for union federation FNV, which represents 19 unions. Its chairwoman Agnes Jongerius had negotiated the accord in principle.

Under the current agreement, the retirement age for the state pension AOW would be increased from 65 to 66 in 2020 and linked to life expectancy.

Workers could still retire at 65, but against decreased benefits. In addition, their pension accrual would be tied to market performance.

Yet Bondgenoten argued that the pension level would become uncertain under such an accord. It also said that employers should still share the financial risks of their pension funds.

Henk van der Kolk, chairman at Bondgenoten, said: "The current pension agreement encourages gambling and punishes the pension funds that invest their assets safely."

The large civil service union AbvaKabo has agreed with Bondgenoten's objections, but it said it would poll its members on the issue early next month.

FNV Bouw, the union for the building industry, has thrown its support behind the accord, as long as workers in hard manual jobs are still able to retire at 65 without loss of purchasing power.

The board of the FNV Federation will take a decision on the pension agreement on 12 September.

Parliament, which has already given social affairs minister Henk Kamp the go-ahead for an elaboration of the pension accord, has scheduled a hearing on the subject for 15-16 September.

It is uncertain what will happen if a majority of the FNV unions turn down the agreement.

Pieter Omtzigt, MP for the Christian Democrats CDA, recently conceded that "no provisions have been made for this scenario".

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