NETHERLANDS - Pension fund governance is going too far and causing serious problems in decision-making and staffing, according to the Foundation for Company Pension Funds (OPF).
"Although we still support the aim of PFG, too many rules are creating practical problems, which are the tipping point for a liquidation process for some schemes," Loek Sibbing, chairman of the OPF said during its congress on Thursday.
"Besides its actual board, a pension fund now needs to deal with a participants' council, an accountability body and a committee for internal supervision," Sibbing explained to IPE.
"Therefore, we must find a simple way to comply with the PFG goals," the OPF chair argued.
Within this context, Sibbing publicly asked the MPs Stef Blok of the liberal VVD party and Fatma Koser Kaya of the liberal democrats D66 to withdraw their proposal for initiative legislation to allow pensioners to be represented on both the board of a pension fund as well on its participants' council.
Sibbing was anticipating to the evaluation of the implementation of the PFG principles at the start of next year.
"We also have received signals about the complicated set up of PFG. We want to use the evaluation to streamline the process, while leaving the principles intact," Bram van Els, spokesman of the Association of Industry-wide Pension Funds (VB) commented to IPE.
During the congress, the OPF chair also made it clear that many pension funds have failed to notify pensions supervisor DNB of any shortfall of their cover ratio, despite being legally required to do so.
"Although DNB has allowed a delay in submitting recovery plans until April, pension funds with a shortfall should start with their preparation right now," Sibbing stressed.
At the same time, the OPF chair questioned whether the mandatory introduction of the indexation label on 1 January 2009 still is the right moment, while being in a worst-case scenario.
Also during the OPF congress, the Christian Democrat MP Pieter Omtzigt and his Labour colleague Jacques Tichelaar said they are considering to table initiative legislation on the introduction of umbrella schemes for different company pension funds, if the government doesn't act quickly and decisively.