The implementation of the long-anticipated switch from a defined benefit (DB) to a defined contribution (DC) system will be delayed by at least six months to 1 July 2023, Dutch pensions minister Carola Schouten announced on Thursday.
“It is not realistic to expect the Law on the future of pensions to come into force on 1 January 2023,” Schouten wrote in a letter, responding to questions asked by MPs.
The latest delay did not come as a surprise to the pension sector as the timeline to steer the law through both houses of parliament before year-end looked ever more unrealistic. Parliamentary discussions have progressed at snail’s pace in the past few months.
The new delay potentially complicates things for the small minority of pension funds that already want to make the transition by 2024.
“We will have to see whether it remains feasible to retain 2024 as the transition year for pension funds now that there’s been another delay,” said president of the Dutch pension federation Ger Jaarsma, speaking at the Pensioenfederatie annual congress on Thursday.
“But at the same time I’d like to tell these funds: please continue with your preparations and don’t wait till the text of the law is final.”
Four-year transition period
Since pension funds and social partners have already started their preparations for the pension transition, there is, for now, no reason to also delay the final transition date for pension funds beyond 1 January 2027, said the ministry’s director-general Stan Kaatee, who also spoke at yesterday’s Pensioenfederatie congress.
Kaatee added: “If the parliament’s Second Chamber manages to pass the law by year-end, it is certain that the text will not change anymore [even though the law still has to be passed by the Senate]. Therefore we still believe the current four-year transition period will be sufficient.”