NETHERLANDS – The €950m pension fund of copier manufacturer Océ has decided to cut pension rights by almost 4.1% on 1 August after its coverage ratio dropped to 88.8% in June.
The fund’s “emergency measure” came in combination with an additional employer contribution of €91m, which accounted for two-thirds of the shortfall.
Several other Dutch pension funds are facing a fresh wave of pension-rights discounts as they struggle to achieve the required minimum funding of approximately 105% by year-end.
Pensioenfonds Océ warned it might need to take “additional steps” next year if its coverage ratio fails to recover to at least 104.3% by 31 December.
In 2010, the employer already paid an extra contribution of almost €3.5m.
Because the scheme has been unable to grant indexation since 2009, its participants have lost out on approximately 11% in inflation compensation, it said.
The €4.1bn scheme PNO Media, which had to apply a rights discount of 3.4% in April, saw its coverage drop to 97.5% in June.
It put the odds for an additional discount – to improve its funding to 104.2% – at 53%.
The €1.5bn industry-wide scheme for the meat, cold meat, snacks and poultry sector (VLEP) reported a coverage of 95.3% at June-end, after it cut pension rights by 7% in April.
It said it would be likely to have to take additional measures in 2014 but stressed that their extent would depend on the scheme’s financial position at year-end.
The €604m pension fund for dental technicians (Tandtechniek) and the €380m scheme for hairdressers (Kappers) saw their coverage ratios drop to 94.1% and 93.3%, respectively, in June, after a rights discount of 7% in April.
Tandtechniek said it had already increased its contributions and decreased its yearly accrual rate, whereas Kappers said it raised its premiums to 8.6%, 0.8% above the cost-covering level.