NETHERLANDS -- The largest Dutch trade union confederation, the FNV, is to lift the retirement age of its own 1,700 employees to 62 from 60.

Earlier this year the labour group was the major opponent of pension minister Aart Jan de Geus’ proposals to raise the pension age and was a leading proponent of strike action and protests.

The FNV’s pension U-turn was made during negotiations on a new collective labour agreement (CAO).

In a joint statement informing employees of the CAO outcome over the weekend, union negotiator and Henk van der Ploeg and Peter Gortzak of the employers’ association said that the changes were imposed by the financial situation of the union’s pension fund.

At end-2004 the fund reported a coverage ratio of around 106.7%, considerably below the supervisory Dutch Central Bank’s requirements. According to the financial situation of the pension fund is forcing them to implement these changes.

Van der Ploeg added that the change to the retirement age was not as drastic as it appeared, noting that currently each of the FNV’s 14 constituent unions have separate retirement ages, ranging from 60 to 63.

Further, he noted that retirement at 60 had ceased to be a practical option because the fund’s negative financial situation had resulted in a freezing of pensions for the past three years, meaning a 6% real drop in overall pension payments.

According to the fund, the overall pension premium paid by employers and employees will stay at 27% of a gross salary with no extra premiums being required to compensate older employees for higher pre-pension payments.

The agreement, which is for he period to January 2008, will affect 10 out of the FNV’s members, with the education sector union ABVAKABO and some smaller unions retaining their own arrangements.

The FNV pension fund had earlier stated that it would not be able to indexation payments in 2005 as a result of its financial situation and new government directives.