Netherlands: 2019 round-up and outlook for 2020
The Dutch pensions market saw a number of developments in the course of 2019 with more expected in 2020.
Pension reform
In June 2019, the Dutch government and social partners reached agreement on a new pensions system, which will include changing the fiscal framework so that pension accrual will no longer vary by age. This effectively means a change to flat contribution rates for defined contribution plans and age-related accrual rates for defined benefit plans from 2022.
Many elements of the new regime have yet to be agreed. A steering group consisting of representatives from the government and social partners is considering these areas, including the conversion of pension entitlements accumulated under the current system, compensation arrangements where individuals will accrue lower benefits under the new structures, and the legislation to implement the new system. The steering group is expected to announce its recommendations during 2020
Consolidation in the pensions market
The number of company pension funds in the Netherlands fell from 160 to 148 over 2019 according to De Nederlandsche Bank, which supervises pension funds. Further consolidation amongst pension funds and pension providers is expected in 2020, as larger funds seek to simplify and harmonise their administration arrangements, and smaller funds to continue to move to industry-wide plans (where possible), insured plans or APFs (Algemeen pensioenfonds).
Sustainable investment
Sustainable investment is an area of focus for Dutch pension funds, supported by asset managers introducing ESG investment funds (including passive funds) and developing benchmarks to help monitor their performance. This trend is set to continue in 2020 as pension funds consider their ESG (Environmental, Social and Governance) criteria, and update their investment policies and risk monitoring frameworks accordingly.
Communicating pension benefits
From 2019 pension administrators are required to provide plan members with pension projections in line with the “Uniform Calculation Method” (Uniforme Rekenmethodiek or URM). With the projections loaded into mijnpensioenoverzicht.nl (an online system where individuals can find details of all their pension entitlements), plan members now have access to illustrations of their expected future pension benefits from all sources on three scenarios.
Milliman’s Rajish Sagoenie and Martin Wouda comment on the events of 2019 and outline their thoughts on the trends and developments for 2020 in a special pensions bulletin (in Dutch).
Contacts
Isabel Coles
Head of International Consulting, MBWL International
VIEW PROFILE
Email:
isabel.coles@mbwl-int.com
Tel: +44 20 3949 5710
Isabel Coles
Head of International Consulting, MBWL International
A multilingual expert in employee benefits for multinational corporates.
Isabel heads up MBWL International, advising multinational organisations on their employee benefits arrangements around the world, with a focus on corporate sales and purchases, accounting disclosures and the financing, risk management and design of benefit plans.
Her vast experience includes leading global accounting consolidations under international, UK and US accounting standards for multinational companies headquartered in the UK and overseas – with consolidations ranging in size from two to over 50 defined benefit plans.
She has advised both corporate and private equity buyers on the employee benefit considerations (including pension liabilities) associated with corporate sales and purchases in Europe and worldwide, from due diligence through to closing and subsequent integration work. Isabel has also undertaken many benefit audits and benchmarking exercises, including a 25-country audit for a company in the technology sector.
Other areas of Isabel’s expertise include reviewing and establishing international pension plans, advice on individual expatriate employee benefit packages and supporting multinationals in agreeing and implementing global governance approaches and policies for managing their employer benefit plans.
Isabel chairs the International Committee of the Association of Consulting Actuaries and is fluent in German and French.
Rajish Sagoenie
Principal and Consulting Actuary, Milliman
VIEW PROFILE
Email:
rajish.sagoenie@milliman.com
Tel: +31 2 07601888
Rajish Sagoenie
Principal and Consulting Actuary, Milliman
An innovative problem-solver adept in delivering value for large clients.
Rajish serves as Pension Managing Director and leader of Milliman’s Employee Benefits practice in the Netherlands; the organisation’s first in Europe.
He specialises in helping large clients and pension funds with issues such as plan design, funding, cost projection, valuation, solvency, risk management and execution of pension plans in a volatile financial environment. Trained as an actuary and a consultant, he uses his in-depth knowledge of the pension, regulatory and financial markets — together with his actuarial, financial and consulting perspective to create innovative solutions for his clients.
Rajish’s significant experience includes consulting to the boards of pension funds, as well as serving as the appointed actuary for several other pension funds. He also operates as consulting actuary for corporate clients, insurance companies and unions.
Contacts
Isabel Coles
Head of International Consulting, MBWL International
VIEW PROFILE
Email:
isabel.coles@mbwl-int.com
Tel: +44 20 3949 5710
Isabel Coles
Head of International Consulting, MBWL International
A multilingual expert in employee benefits for multinational corporates.
Isabel heads up MBWL International, advising multinational organisations on their employee benefits arrangements around the world, with a focus on corporate sales and purchases, accounting disclosures and the financing, risk management and design of benefit plans.
Her vast experience includes leading global accounting consolidations under international, UK and US accounting standards for multinational companies headquartered in the UK and overseas – with consolidations ranging in size from two to over 50 defined benefit plans.
She has advised both corporate and private equity buyers on the employee benefit considerations (including pension liabilities) associated with corporate sales and purchases in Europe and worldwide, from due diligence through to closing and subsequent integration work. Isabel has also undertaken many benefit audits and benchmarking exercises, including a 25-country audit for a company in the technology sector.
Other areas of Isabel’s expertise include reviewing and establishing international pension plans, advice on individual expatriate employee benefit packages and supporting multinationals in agreeing and implementing global governance approaches and policies for managing their employer benefit plans.
Isabel chairs the International Committee of the Association of Consulting Actuaries and is fluent in German and French.
Rajish Sagoenie
Principal and Consulting Actuary, Milliman
VIEW PROFILE
Email:
rajish.sagoenie@milliman.com
Tel: +31 2 07601888
Rajish Sagoenie
Principal and Consulting Actuary, Milliman
An innovative problem-solver adept in delivering value for large clients.
Rajish serves as Pension Managing Director and leader of Milliman’s Employee Benefits practice in the Netherlands; the organisation’s first in Europe.
He specialises in helping large clients and pension funds with issues such as plan design, funding, cost projection, valuation, solvency, risk management and execution of pension plans in a volatile financial environment. Trained as an actuary and a consultant, he uses his in-depth knowledge of the pension, regulatory and financial markets — together with his actuarial, financial and consulting perspective to create innovative solutions for his clients.
Rajish’s significant experience includes consulting to the boards of pension funds, as well as serving as the appointed actuary for several other pension funds. He also operates as consulting actuary for corporate clients, insurance companies and unions.