NETHERLANDS - Three unions for military personnel have made arrangements to set up a ‘levensloop', or life course, scheme with insurer Aego, instead of placing contributions with the scheme of their employer, the ministry of Defence.

Part of the contract for the unions' 40,000 members is an interest percentage with a bonus of 0.5% on top of the market rate, said chairman Jan Kleian of the union ACOM.

Moreover, participants will not need to pay a fee in 2008, and will pay a reduced fee thereafter, the unions made clear.

According to the unions - ACOM, AFMP and Marver - they have taken the initiative, "because the ministry of Defence doesn't stimulate the levensloop with an attractive collective scheme".

"Defence was not prepared to setting up a collective scheme, nor to make a financial contribution," Kleian commented to IPE.

Union officials have indicated they are keen for their members to use the levensloop to finance early retirement as recent legislation means military staff need to keep on working longer, up to the age of 60 in 2018.

In principle, the ministry of Defence only agrees to its staff taking intermediate leave if  ‘work' allows.

The contract has been concluded through The Financial Service Providers (DFD), the Netherlands' largest intermediary on the defence market.

‘Levensloop' is an individual tax-friendly savings scheme for intermediate unpaid leave, such as parental and care leave or a sabbatical. Although it is meant to encourage employees to working longer, it still allows for early retirement.

Takeup of the levensloop has been disappointing so far as only 5.6% of the workers participated in the first year, 2006, compared with expectations of 20%.

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