Dutch pension funds, retirees need more say before system overhaul, says NSC
Coalition party NSC wants all pension funds to consult their members on whether they want to switch to the new pension system. NSC parliamentarian Agnes Joseph is submitting a proposal to have the participants of each pension fund express their opinion in a referendum before their fund can make the switch, NOS reports.
The NSC has long advocated for pension fund participants to have more influence on their fund’s switch to the new system, but this is the first concrete proposal. According to MP Joseph, people who are dependent on a fixed pension fear that they will end up with an uncertain pension, jeopardizing their livelihoods. She worries that many dissatisfied people will take the matter to court. “I think the risks are particularly high and that people should decide for themselves whether they want this or not.”
The new pension system is one of many sensitive topics in the coalition. Only the VVD is outspokenly in favor of the new pension law. This NSC proposal and several others were already on the table during the formation process, but the parties could not agree and due to skyrocketing tensions, finally made pensions a free issue. According to NOS, the parties did agree informally that they would make no major pension proposals until 1 January 2025. The NSC waited until 20 days after the deadline.
The pension law was adopted 1.5 years ago after a long a difficult process. It took effect on 1 January 2023. Whether Joseph’s proposal to amend it will be adopted remains to be seen. It has a chance of success in the Tweede Kamer, the lower house of the Dutch parliament, where the parties that adopted the law no longer have a majority after the November 2023 election. The threshold is higher in the Eerste Kamer, the Dutch Senate, where they do still have a majority.
In the new pension system, the pension and the build-up of the pension are more individual and the amount depends more on the economy and stock market prices. Proponents of the new system believe this will keep pensions sustainable in the future. People now change jobs more often are and more often self-employed than when the old system was built. However, opponents fear that the amount of the pension benefit will become too uncertain in the new system.
The pension funds themselves believe that reforms are necessary and are happy with the new law. Some funds have already switched to the new system while others are preparing for the step. All funds must switch to the new system by 2028.
