NETHERLANDS – The Dutch Financial Markets Authority (AFM) has spoken out in favour of a website allowing the quality of the country's pension funds to be compared.

The site should provide insight into the quality of a pension scheme in order to enable participants to anticipate disappointing pension claims through additional arrangements, the AFM said in its annual report.

It also said communications between pension provider and participants should not only be comprehensible, correct and timely, but also consist of more than the legally required information.

According to the supervisor, the comparison system should be implemented in addition to the recommendations for pensions communication, issued by the Ministry for Social Affairs (SZW).

Last June, the ministry advised, for example, to present information in layers. Participants should also be offered the option of additional saving, while providers should provide clarity on the investment risks, SZW said.

In its annual report, the AFM said that an increasing number of pension funds were examining the risk appetite of participants, adding that the market very much appreciated such initiatives.

The communications watchdog further said that risk factors, such as indexation, rights cuts, a divorce or a career change, should also be included in the current uniform pension statement (UPO).

When asked by IPE, the Pensions Federation said it favoured a fundamentally different approach to comparing pension plans.

"Comparing quality, through for example a quality mark, is far too subjective, and doesn't provide a participant an insight into his options," stressed Gert Kloosterboer, spokesman for the lobbying organisation.

"That's why we prefer the layered information of the system Pension 123, that enables participants to choose the level of detail themselves," he explained.