While a number of pension funds can already confirm that pensions will not be reduced (this year), the cleaning pension is still unclear. Executive director, Tarik Uçar, of BPF Schoonmaak says it is currently still ‘too close to call’.
Initially, a funding ratio of 104.5% was required from this year to avoid pension cuts. But at many pension funds, the coverage ratio was around 90% this spring. That meant a cut of around 15% in pensions. To avoid that, the government lowered the lower limit to 90%.
Even this percentage still seemed to lead to cuts at many pension funds, BPF Schoonmaak's coverage ratio was still at 85.6 per cent at the end of November. Currently, the coverage ratio is estimated at 90.1%, just above the minimum requirement. However, Uçar says this is too close to the 90% to give clarity at this stage. Indeed, it could still change slightly and then end up just below the 90%. Only in a few weeks will there be certainty about this.
Continued chance of reduction
Even if pensions do not have to be reduced this year, the risk of reductions remains real. In the coming years, the lower limit of 90% will still apply, but by 2026, pension funds must be at 95%. Whether this can be achieved depends entirely on the economy, so with the current uncertain times, there is little clarity on that either.
The new pension system will take effect in 2026. The aim is a more transparent and personalised system, more in tune with today's society and moving with the economy.
English (UK)