Large pension funds barely increasing pensions next year; No more than 3%

Millions of Netherlands residents can kiss hopes for a big pension increase goodbye. Civil servants’ fund ABP, the largest fund in the Netherlands with 3 million members, can increase pensions by a maximum of 3 percent next year. Healthcare fund PFZW’s increase will probably be much less, and bpfBOUW, the pension fund for the construction sector, may not increase pensions at all.

The cause is not a dire financial situation. The funds are in excellent shape thanks to the increased interest rates. But their policy stipulates that they look at price index figures from Statistics Netherlands (CBS) when deciding on indexing pensions, or adjusting them to inflation. These have fallen considerably recently, partly due to a new calculation method from CBS. It also depends on which reference date the funds use when deciding next year’s pensions.

“As always, we look at the price increase between September last year and September this year. According to CBS, that amounts to 3 percent,” said ABP chairman Harmen van Wijnen. The question remains whether pensions can actually be increased by that percentage. “Not only must the financial position be sufficient, we must also see whether such a decision is balanced for all groups of participants. In addition, we must maintain sufficient reserves so that we can move to the new pension scheme in a healthy way in 2027.”

Metal funds PME and PMT may have slightly more room for pension increases. They gauged inflation at the beginning of July, making pension increases of around 3.3 percent possible. But at the PFZW healthcare fund, the maximum increase is currently only 0.2 percent. A spokesperson pointed out that the decision has not been made yet. According to her, the board could still decide to allow slightly higher increases.

BpfBOUW uses a different comparison period. According to the fund, there was no inflation at all during that period - prices fell by an average of 1.39 percent. That gives the fund no reason to increase pensions at all. Eline Lundgren, chairman of bpfBOUW, understands this can be an unpleasant surprise. “I can well imagine that these figures from CBS differ from what people might expect. We are currently hearing and reading a lot about the costs of groceries and energy prices.”