NETHERLANDS - Social affairs' minister Piet Hein Donner has advised Parliament against allowing pensioners onto the board of industry-wide pension funds at this time.

In his opinion, the issue of pensioner representation should be addressed by taking into account the increasing expertise of board members, adequate representation of pension funds' participants and streamlining of governance.

Donner made his comments last week in response to a scheduled discussion in Parliament about initiative legislation - tabled by MPs Stef Blok and Fatma Koşer Kaja, of liberal party VVD and liberal democrat party D66 respectively - to give pensioners a say on the boards of industry-wide schemes.

The social partners of employers and employees as well as the representatives of elderly organisations had earlier failed to agree on a more balanced composition of the boards, after Parliament asked them to find such a solution.

"The initiative legislation merely offers a solution in part, and means a uniform arrangement for widely varying conditions at pension funds," the minister argued.

Donner said he instead favours an integral approach, in which improvements of governance are linked to the recent recommendations of the Committees Frijns and Goudswaard, concerning improvement to risk management and the sustainability of the pension system respectively.

The Frijns Committee, for example, suggested independent professionals should be appointed to pension fund boards, and recommended the establishment of independent boards of trustees.

In the minister's opinion, pensioners' position could be reinforced by granting accountability rights to sit on a scheme's participants' council.

He further suggested that checks and balances on participants' say can be streamlined through the merger of the present accountability body into the participants council.

"All pension funds' representative bodies support Donner's preference for an integrated approach, including the introduction of professionals on pension funds' boards," responded Frans Prins, director of the Foundation for Company Funds(OPF).

"However, we think that the minister should reconsider his suggestion for a new board of trustees, as an extra body is at odds with his wish to streamline governance," said Prins, who added that the employers' role in governance should be increased, in order to keep companies involved in their pension funds.

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