Thursday, October 17, 2013 - 05:32
Pension Funds Improve Considerably
On Thursday the Dutch pension funds made the numbers of the third quarter public. In general the degree of coverage increased and there is now some hope that pensions will not be cut down next year. According to the law, the pension funds must have a degree of coverage higher than 105 percent. This is to assure the retired people that their pension can be paid and that they can live on the same standard as usual. Is the degree of coverage lower than the said level than the pension funds can announce that they will pay less in the next year. Pension fund bpfBouw, of the construction sector, saw the degree of coverage increase to 109.7 percent and they immediately announced that they will not cut the pensions next year. Although the largest pension fund, ABP, couldn’t announce that they will not cut pensions next year, they saw the degree of coverage grow from 97.1 percent in the second quarter to 103.3 percent in the third quarter. Pension fund Zorg & Welzijn, of the health sector is a little bit more positive about next year. Their degree of coverage rose from 101 percent (2nd quarter) to 107 percent. If at the end of December they will be on 105 percent or higher than they will not cut the pensions next year. Things don’t look so good yet for the metalektro pension fund PME (metal and electricity sector). Although they saw also an increase of five percent ion the third quarter, their degree of coverage only reached 101.9 percent. It is very likely that they will have to cut the pensions in 2014. The increase of the degree of coverage of the pension funds is due to a better rate of return and higher interests.