NETHERLANDS - The Campina and Friesland Coberco pension funds in the Netherlands are facing union and pensioner anger over plans to stop indexing payments to inflation.
The €900m Campina pension fund, the defined benefit fund of one of the largest Dutch dairy sector companies, is at present engaged in a battle with a large group of pensioners who have demanded the continuation of total indexation of pensions.
Bernard Bijvoet, former chairman of the board of the dairy producer and now the spokesman of the 6,000 pensioners, said the pension fund should keep to full indexation of existing pensions in the coming years. The pensioners in April won a court case to maintain full indexation in 2004, although Campina is appealing currently. Bijvoet has also written to the pensions regulator, the PVK, demanding a criminal investigation.
Anton Ooijen, chief executive of the Campina pension fund, said full indexation would cause financial trouble for current Campina employees. He told IPE that in 2003 company contributions to the pension fund were 25% of total salary costs and, “reaching a level that was no longer feasible” to maintain.
As a result, last September Campina agreed with the trade unions that the 4,000 active personnel would pay 3% to 4% into the fund and indexation would be lowered by 1.2%.
Leo Bonds, spokesman for the Christian Trade Union (CNV) Dairy Section, told IPE the trade unions were following the argument closely but did not support all of the pensioners’ demands. Rather than totally stopping indexation, pension premiums should be increased to cover liabilities and employees to make contributions as agreed. But as a compromise, he said the pension fund could move to part-indexation, as full indexation would have negative financial repercussions for current Campina employees.
Separately, another dairy producer’s pension fund, Friesland Coberco, the trade union, Unie, has demanded full indexation but without all of the pensioners’ support. The CNV is refusing to support Unie’s claim. Bonds stated that the CNV is not at all happy with the Unie demand.