The new pension law will be put to a vote in the Senate this week. The law has been under discussion for years and, despite numerous objections, Minister Carola Schouten is counting on support, even if he is not yet certain in the Senate. “We’ve really embraced constructive criticism where possible.” But 50PLUS talks about a “terrible system”.
The current pension fund worth €1.5 trillion will be redistributed under the new system. According to the minister, this fits better with the current time. ‘Where people also get a feel for indexing first if possible. But where young people can also see more easily what they are building, even if they change jobs,’ said the minister for poverty policy, participation and pensions (ChristenUnie).
Careful
In light of numerous objections, the cabinet says it will proceed with caution, Schouten stresses. ‘We’re not just going to introduce the new system, shall we say, next week. It will take a few years to do that. It’s about people’s money, we’re very aware of that.’
“It’s about people’s money, we’re very aware of that”
The government has until 1 January 2027 to implement the new system. To do that, he’ll first need to secure a majority in the Senate this week. 50PLUS Senator Martin van Rooijen is curious about the reports in the House. ‘We are very concerned about this new system, it contains many errors. Care should really take precedence over speed.’
“Terrible System”
The law has been under discussion for fifteen years, yet 50PLUS thinks not all the pain is over yet. “We’ve asked almost a thousand questions, the answers are far below average,” says Van Rooijen, who indicates that he will “put the matter to the test” during the debate.
“It’s a terrible system”
According to Van Rooijen, the fact that people will get better under the new system and have more control over their pension, as envisaged by Minister Schouten, is a ‘fairy tale’. “It’s a terrible system,” he says. “It is nominally controlled by the rules of De Nederlandsche Bank. Investments are said to be risk-free. But no risk means no returns and no indexing. Retirees are its victims.”
Pension issue
Van Rooijen finds the objections so serious that he warns of a “pension deal which will be much bigger than the benefits deal”, because the tax and customs administration would not be able to cope with the implementation of the new system. “There it was tens of thousands of people, here it is ten million participants: seven million employees and three million pensioners.” To make matters worse, according to Van Rooijen, any possibility of proposing opposition has been ruled out. “We live in a state governed by the rule of law, but in this system all rights of citizens have been deprived.”
A further problem is the retirement of soldiers and politicians. Despite promises, no indexing has ever been applied there. “If the military switches to the new system, the Ministry of Defense must first deposit another ten billion euros.” For politicians’ pensions, it’s about half a billion, says Van Rooijen.
New Senate
The debate in the Senate will last two days. Part of the opposition is dissatisfied with the debate taking place today, while the new Senate will be elected next week. The senate that takes office next month will look very different after that election. The coalition, which already lacks a majority, will then lose even more seats. BBB, fierce opponent of the pension law, becomes the largest in one fell swoop.
The House of Representatives approved the law at the end of December, after a very extensive legislative process. Dutch pension assets (in the hundreds of billions) are moving from a collective fund to largely individual funds. Switching to this new way of accruing pensions can cost tens of billions and it is not yet fully understood how the new system will work for specific funds. However, many parties see that the pension system in its current form is no longer up to date. The new system is more flexible and better suited to the current labor market.
Source: BNR
Fernando Dowling is an author and political journalist who writes for 24 News Globe. He has a deep understanding of the political landscape and a passion for analyzing the latest political trends and news.
