Individual pensions accrual will not form the backbone of a new pensions system in the Netherlands, according to Dutch newspaper De Telegraaf.

Citing a “draft agreement” between employer organisation VNO-NCW and trade union FNV, the newspaper said that the players had opted for a collective pension arrangement.

The concept offered fewer guarantees but with more scope for indexation, resembling a pensions contract under real terms rather than nominal ones.

However, the FNV has emphasised that there was no definite deal yet.

The option of a real-terms pensions contract was reportedly also being discussed by the Social and Economic Council (SER), the Dutch government’s main advisory body made up of employers and workers.

The real-terms feature was reportedly brought in to the discussions as the unions kept their objections to individual pensions accrual, favouring collective accrual instead.

The individual pensions accrual was to be dropped, according to De Telegraaf, as the deliberations within the SER didn’t show “much added value ultimately”.

The government’s plan for a quick increase to the retirement age was also strongly opposed by the trade unions.

According to the draft pensions agreement, the government’s agreed increase to the state pension (AOW) age – due to rise to 67 in 2021 – is to be postponed to 2025.

Subsequently, the AOW age will rise by six months, rather than 12, for each additional year’s improvement in life expectancy.

The draft accord also provided for mandatory pensions saving for self-employed, albeit with an opt-out, De Telegraaf reported.

The next stage

According to Tuur Elzinga, the FNV’s pensions negotiator, there had been no agreement “as several texts and proposals are in circulation and nothing has been signed yet”.

Although Elzinga declined to reveal details about the concept, other sources confirmed or recognised the content of De Telegraaf’s story.

One source told IPE’s sister title Pensioen Pro that the three main unions were discussing the issue with VNO-NCW and that they preferred to complete the final agreement through the SER.

Were this accord to become the position of the social partners, it would present a dilemma for social affairs minister Wouter Koolmees.

Postponing the state pension age increase would cost the government billions, while the preferred individual pensions accrual – which formed part of the coalition agreement – would be off the table.

Recently, the government resolutely rejected a request from the social partners in the building industry for a state pension entitlement after a working career of 45 years.

The other aim of the coalition government – to abolish the system of average pensions accrual – could still be honoured according to the draft, albeit under certain conditions.

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