SPD, the €1bn occupational pension fund for veterinary surgeons in the Netherlands, is to introduce a new pension plan on 1 January 2015 in a bid to shore up support within the sector.
The new arrangements provide for a lower franchise – the part of the salary exempt from pensions accrual – and an extension of mandatory participation to all practising vets.
The new pension plan was approved by a large majority of the members of the participants’ association (DPD), the body that appoints board members and must be consulted about statutory changes.
Last year, the DPD noted that support among members for mandatory participation – and as such the existence of the pension plan itself – was approaching the minimum threshold of 60% of the profession affiliated with the DPD.
A lower indication of support would mean that vets must organise their pension arrangements themselves.
SPD said part of the new pension plan would also entail greater pensions accrual, which in turn would result in increased contributions.
Premiums will increase by 2.9 percentage points to 12.6% for vets from 25 to 30 years old, while those between 60 and 65 will pay slightly less – a drop of 0.2 percentage points to 33.4%
The pension fund reported returns on investments of 4% over 2013, although this was offset by a combined loss of 4.7% on its interest and currency hedges.
It said it spent €371 per participant on administration last year, adding that its costs for asset management and transactions were 0.39% and 0.2%, respectively.
Both pensions administration and asset management have been contracted out to Syntrus Achmea.
SPD was forced to apply rights cuts of 1.1% and 3.1% in 2013 and 2014, respectively, to raise its coverage ratio to the required minimum of 104.1%.
In July, funding increased to 108.1%, according to the scheme, which has not yet published more recent figures.