first_imgHe also suggested his participants would reject any “cold” defined contribution plan.Corien Wortmann-Kool, ABP’s chair since 1 January, underlined the importance of preserving mandatory participation as a condition for collective risk-sharing for “affordable and stable” pensions.Borgdorff, referring to the Cabinet’s plan to replace the current average contribution and accrual with a so-called ‘degressive’ system – now considered fairer for all generations – also warned against a progressive premium.This, he said, would hinder pensions accrual for participants over the age of 45, making this demographic “expensive” for employers.He added that PFZW’s biggest concern was that the transition from average accrual to degressive accrual would be carried out in an “unbalanced” way.ABP’s Wortmann-Kool stressed that there would be only one opportunity to make the transition in the right way, “as it would be almost impossible to reverse changes”.She also argued that the pensions system needed to be modernised more quickly.“If we keep on discussing changes in technical terms and complicated panoramas, we risk that participants – as well as politicians – grow tired of pensions and give up,” she said. Also during the conference, Casper van Ewijk, director at Netspar, argued that the cost involved in the transition from one accrual system to another – estimated at €25bn-100bn – would not be lost but merely “transferred” from one generation to another.He said the costs could be defrayed using pension assets, which would largely affect older workers, or contributions, which would hit younger participants.A combination of the two would also be possible, he added. The €356bn civil service pension fund ABP and €166bn healthcare scheme PFZW have voiced their support for the concept of individual pensions accrual in the Dutch pensions system, but only as long as collective risk-sharing is preserved.Speaking at the recent IIR Pensioenforum, the Netherlands’ two largest pension funds were presenting their views on the prospective design of a more sustainable pensions system.The schemes effectively threw their weight behind a proposal being fleshed out by the Social Affairs Ministry, out of a total of four proposals issued by the Social and Economic Council (SER).Peter Borgdorff, director at PFZW, warned that the solidarity element of “collective buffers” must remain, “as participants won’t be able to carry all risks while accruing a pension individually”.last_img

ABP, PFZW throw weight behind individual pensions accrual

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