NETHERLANDS - PNO, the €2.5bn pension fund for the media, has not ruled out the prospect of cutting pension benefits and claims, if additional recovery measures turn out to be insufficient to improve its funding level.

The scheme, which saw its cover ratio drop by 33% to 88.1% and its assets decrease by €200m last year, said it will not be able to grant any indexation over the next five years, and is unlikely to be able to fulfil more than half of its indexation ambition in the next 15 years either, according to its recovery plan.

PNO Media will also raise contributions required by 1.4% to 18% of pensionable salary within a year, having indicated this measure is meant to be temporary for the next five years.

The board said further increases to premiums may be the only practical option to keep its recovery process on track.

The scheme has decided not to alter its investment policy, so maintains an asset mix of 39% fixed income, 36% equity and 25% alternatives, which includes property investments.

If recovery of the fund's required regulatory funding level takes place quicker than expected, PNO Media will use the financial margin for indexation, it said.

The industry-wide pension fund has approximately 15,470 active participants, 13,325 deferred members and 6,025 pensioners, as well as 360 affiliated employers.

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