STAR urges changes to new law
The Dutch Labour Foundation (STAR) has written to the parliamentary social affairs committee urging changes to the government’s proposed pension bill.
The draft is to be debated in parliament in the spring and is expected to come into force at the beginning of 2007. The social affairs committee is to begin hearings with interested parties within the coming weeks.
STAR, a national consultative body consisting of the three trade union federations and three employers’ associations, is critical of the lack of information on the practical aspects of the new law.
It notes that the text of the general measures of management/policy (AMvBs) is still unpublished and says pension organisations and funds would need to be able to offer advice on the AMvBs measures before implementation.
It points out that the legislation does not mention the collective DC schemes which are a growing feature of the pensions system. It says they need to be included to allow the DNB, the pensions regulator, an opportunity to support the new arrangements.
STAR says the bill proposes a reduction to 21 of the age at which it would be possible to begin pension contributions and urged the government to consider introducing sector-specific pension contribution ages.
It says the inclusion in a pension system of part-time workers, like those in the service sector occupations, would lead to an exponential increase in administrative costs and bureaucracy.
The letter says the one-year recovery period the bill foresees for pension funds whose coverage ratio falls below 105% is unfeasible. A recovery in just one year could only be achieved by taking draconian measures, it argues.
It also rejects the current strict interpretation of risk-aversion, saying the DNB-supported strategy leads to lower investment yields, which will mean lower pensions in the long run.