NETHERLANDS – The pension funds of the PVK pension regulator and the central bank will not remain independent after the two institutions merge, a spokesman says.

The Dutch government approved the merger between the Nederlansche Bank and the Pensioen- & Verzekeringskamer on June 4.

Lutke Schipholt, a spokesman for the DNB/PVK, stated that the merger process would have direct consequences for the formerly independent pension funds of the two organisations. He said the two funds would not remain independent after the merger.

The head of the new merged fund is still undecided, the spokesman said, adding that it is currently under discussion.

The PVK fund has 250 employees while its DNB counterpart has 1,700. The fund is managed in-house and PVK scheme has been outsourced to Centraal Beheer, the insurer. The schemes use in-house advice.

One of the main issues will be the need to harmonise the different pension arrangements over the coming months. With this in mind, the Dutch parliament has been presented a preliminary law covering the merger.

According to Schipholt, further information about the specifics of the pension fund merger will not be given before the law has gone through parliament. Several judicial issues still have to be settled, before new information will be given to the public.

He declined to comment when asked about potential job losses at the pension funds or the specific financial situation of the new DNB-PVK pension fund. There have already been several parliamentary questions on the merger law.

According to Labour Party MP Frank Heemskerk, there is already a need to evaluate the merger in 2006 – and not in 2008 as planned. He says this will provide a quicker view on changes and synergy issues.

One of the reasons for the proposed merger as presented by DNB-PVK is the potential gains to be expected from lower overall costs of administration and supervision.

Dutch media have focused on the pension arrangements of the DNB and PVK management after opposition parties and several government members questioned the arrangements.
It has emerged that some managers, such as the DNB’s professor Schilder, have received what are seen as generous pension arrangements.