Making the self-employed save 20% of their gross income for pensions is “proportional”, according to the Dutch pension federation. The organisation has given the government positive advice about making this obligatory.
Others, such as the Circle of Pension Specialists (KPS), have different views.
Earlier this year, four political parties (VVD, D66, CDA and SGP) proposed a new law making it mandatory for the self-employed to save for their pensions. However, the four parties stopped short of suggesting a minimum percentage, instead asking the pension sector for input.
Proportional contribution
In its consultation response, the Pension Federation was the first to come up with a concrete percentage of the gross income that the self-employed should set aside for their pension. According to the umbrella organisation, contributions paid to most mandatory pension funds amount to at least 20% of gross income.
If the self-employed want to have a proportional contribution to their pension, setting aside at least 20% of their gross income is also desirable for them, according to Pensioenfederatie.
Mandatory pension saving for the self-employed would also contribute to a level playing field in the labour market, Pensioenfederatie said. “It is desirable that the competition with salaried employees that has been created by the legislator on the employment condition of pension is removed,” it said in its consultation response.
Coercive measure
Another response from the pension sector came from the Circle of Pension Specialists (KPS). This group of pension experts has doubts about whether a mandatory provision for pensions will contribute to a level playing field. This leads “in practice to additional obligations for the self-employed that do not apply to employees”, KPS noted.
The organisation calls an obligation to the self-employed to save for pensions a coercive measure to force the self-employed to make arrangements for their pension. “The question is whether this is at all possible and even allowed in view of the right of the self-employed to conduct their business freely.”
In any case, the subject is still high on the agenda for VVD, which advertises itself as the “entrepreneurial party”.
In its (draft) election manifesto, the introduction of the Self-Employed Act is mentioned as one of the points under its top priority for its electoral campaign – radical economic growth.
The other three parties are yet to make public their electoral manifestos.
Parliamentary elections in the Netherlands are scheduled for 29 October.
This article was first published on Pensioen Pro, IPE’s Dutch sister publication. It was translated and adapted for IPE by Tjibbe Hoekstra.
