NETHERLANDS - Dutch employers say a thorough deregulation of the pension system, including the present arrangements for indexation, is required to counter increasing risks and costs for companies.
A report published by employers organisations argues: "Too much regulation, enhanced by market insecurity and interest developments, is undermining the affordability, feasibility and continuance of Dutch pension schemes."
The employers - represented by professional bodies VNO-NCW, LTO, MKB and AWVN - have called on the government to commission the Labour Foundation (Star) to draw up proposals for deregulation.
The lobby group believes introducing the option of collective defined contribution schemes (CDC) in the Pensions Act is necessary, as they believe this will allow listed companies to comply with the new IFRS accounting rules, which prescribe them to show their pension liabilities on their balance sheet.
In their opinion, the desire to deliver indexation should be limited by replacing the indexation clauses in the scheme, by collective labour agreements (CAOs) which contain the yearly indexation to be decided by the pension fund's board.
"Real pension promises lack a sense of reality and ignore the large risks to companies," according to the employers, who described the new indexation label as ‘overregulation'.
In addition to a phased rise of the official retirement age from 65 to 67, the employer bodies have asked a study be conducted linking the state pension AOW to the average life expectancy.
The retirement age must become more flexible and the options for part-time pensions should be increased, the employers stated, adding all participants in pension schemes should collectively pay for the increased longevity risk.
Employers want to limit the salary base from which individuals are entitled to a pension, and argue the goal of delivering a pension should be limited to compulsory participation for up to a defined income level, followed by voluntary participation for any additional income.
In the opinion of VNO-NCW, LTO, MKB and AWVN, additional research is needed into the option of a ‘pension in kind' - consisting of care and nursing services - as well as how this can be supplied, given the ring-fenced tasks of pension funds and insurers.
Furthermore, the employer representatives are seeking assurance from the government there will be no continuing ‘scaling up' of pension providers as they fear this process could lead to insufficient differentiation in services.
The tax-friendly savings scheme ‘levensloop', or life course, to provide a more flexible connection to the old-age pension and should also be applied to self-employed workers, the employers added.
If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email firstname.lastname@example.org