The pension agreement is the agreement reached in 2019 regarding the future of the Dutch pension system between the government, the employers’ organisations and the national trade unions. One thing we already know is that from 2019 onwards, the age of entitlement to state retirement pension (AOW) will rise less rapidly than previously agreed. For some participants of our fund, this means that they will be receiving - or are already receiving - AOW pension earlier than expected.

Further details of the agreement were worked out this year. The two main changes are:

• Today, everyone with the same salary accrues the same amount of pension each year. This will change. In the new situation, all participants will pay a premium based on a percentage that is still the same for all ages, but the amount of pension that will be accrued with this will depend on the realised returns and the passage of time.
• We will move to new agreement under which the pension funds will no longer have to hold any additional financial buffers. The collective pension capital and the return realised on this will be allocated to the individual participants and pensioners each year. If the returns are good we can increase the pensions more quickly, but we will also have to reduce the pensions more quickly if things do not go well.

A participant may receive more or less pension than under the current agreement. The transition to a system without age-related premium could be disadvantageous for some groups of participants. The government and the social partners (at national level) have agreed that these participants will have to be compensated appropriately, but the details of how to do this still have to be worked out. 

The consequences of the pension agreement for your pension scheme are also not yet entirely clear. The aim is to have the new legislation take effect on 1 January 2022, but it will take much longer than that for the pension scheme to be amended accordingly. The transition period will actually run until 2026.