NETHERLANDS - Pension fund organisations VB, OPF and UvB have urged the Dutch Parliament to resist a wholesale cut of pension rights based solely on the applied method for calculating pension funds' coverage in the wake of historically low interest rates.
In a letter to Parliament, the organisations said such drastic measure might prove unnecessary in light of the current review of the financial assessment framework (FTK) and pension contracts, as well as pension agreements made during coalition talks.
While VB, OPF and UvB stressed that they did not want to distance themselves from the FTK rule to mark pension liabilities to market values, they said a rights cut should be considered only as a last resort.
However, they conceded that sticking to a delay for this measure until 1 April 2012 for schemes with shortfalls would be "irresponsible".
While the pension regulator De Nederlandsche Bank has already deemed a 1% cut sufficient for a scheme's recovery within the set five-year period, the lobbying organisations claim this is at odds with the Pension Act, which stipulates that a rights cut should be a last option.
The organisations have called for an urgent consultation regarding the issue with social affairs' minister Piet Hein Donner and the social partners of employers and employees.