Pension contributions in the Netherlands so far this year have fallen for the first time in years due to pension funds’ improved financial position, as well as a drop in the yearly pensions accrual, according to De Nederlandsche Bank (DNB).
In a survey of 25 large pension funds – serving 75% of all active participants and pensioners – the regulator found that combined premiums fell from 19.2% to 17.6% of salary.
The DNB found said the contribution from employers had fallen in particular, from 12.5% to 11.2% of salary.
The watchdog’s finding fit with the observations of Arjan Nollen, director of corporate clients at insurer Nationale Nederlanden.
During a recent Euroforum congress for employers, he noted a growing desire among Dutch employers to limit their contribution from two-thirds at present to 50% of the total premium.
The DNB said the drop in employers’ contributions was most noticeable at company pension funds, which usually pay a larger share than companies affiliated with industry-wide schemes.
Following a decrease in the tax-friendly pensions accrual for average salary schemes from 2.25% to 2.15% as of 1 January, pension funds have already lowered their accrual from 1.99% to 1.93% on average this year, the regulator said.
From 1 January 2015, tax-facilitated accrual is to be reduced to 1.875%.
Because pension funds have continued to improve their financial position, they have raised their indexation to 0.4% per active participant on average, and to 2% on average for pensioners and deferred members in 2014, the DNB said.
In 2013, only pensioners received inflation compensation, at 0.1% on average, it added.
Since 2007, indexation in arrears has been at approximately 9% in total, according to the regulator.