GroenLinks and PvdA, the two left-wing opposition parties whose support for the Dutch government relies on the vote for the new Dutch pension law through the Senate, want government to provide more details on what it considers a “balanced transition” of pension capital from defined benefit (DB) to defined contribution (DC).
After a process spanning more than a decade, the new draft pension law was finally discussed by the Dutch parliamentary committee for Social Affairs for the first time on Monday in a debate which lasted almost 12 hours.
Parliamentarian Henk Nijboer of left-wing opposition party PvdA said in his contribution that he needs to see “a clearer explanation” of how pension capital is distributed between different member groups upon the transition to DC.
Currently, the law’s text only stipulates the transition must happen in a “balanced” way, leaving the interpretation of this to pension funds and social partners.
“We need a more detailed phrasing of what we consider balanced,” Nijboer’s colleague Senna Maatoug of fellow left-wing opposition party GroenLinks chimed in. “The government sees the transition as merely a technical exercise, but I believe this is too limited a view,” Maatoug added.
Redistribution
According to her, the DC transition should not only be balanced in the sense that it ensures every generation get its fair share of the pot. In addition, the government should also seize the opportunity to redistribute pension capital more fairly, she added.
“We should also make sure that every income group receives an acceptable pension,” she said, suggesting the law could involve capital transfers from the rich to the poor.
“Maybe this indeed is a left-wing politician speaking here, but there is one big pension pot. How to distribute this pot now that we are transitioning to a new pension system, is inherently a political question. It’s a little naive to say it is merely a technical subject,” she noted.
Nijboer also called for a “fair distribution of pension capital” in his contribution to the debate.
The new demands threaten to delay the implementation of the pension law, which is currently still officially expected to come into force by 1 January 2023.
Both Nijboer and Maatoug indicated, however, that they are not prepared to vote through the law in its current form. This would make it unlikely that their parties’ Senate delegations were to vote in favour of it.
Coalition parliamentarian Bart Smals (VVD) agreed with the two opposition parliamentarians that it is necessary to better define what a balanced transition is, without making any concessions with respect to the content of the law. “As a liberal party, we make different considerations on this topic than left-wing parties,” he said.
More ambition needed on self-employed pensions
Though PvdA an GroenLinks did sign the pension agreement that paved the way for the pension transition in 2019, they now say the government’s promise to make more working people accrue pensions has not been sufficiently met.
PvdA MP Henk Nijboer threatened to withhold further support for the pension changes if the government doesn’t do more to especially increase the share of the country’s workers that save for their pension, currently 1.7 million people.
According to Nijboer, the government should formulate a concrete ambition on this, namely to halve this number within five years.
Nijboer’s colleague Senna Maatoug (GroenLinks) also stressed the importance to reduce the “white spot”, the term commonly used in the Netherlands to refer to people without a pension.
“The law has not been finished yet. If I were to vote on it today, I’d vote against,” she said.
Pensions minister Carola Schouten will speak in the next parliamentary debate on the new pension law scheduled for Thursday, during which she may address the opposition’s new demands.
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