Dutch Pension Funds in Underfunding: Solving Generational Dilemmas
AbstractPension funds in the Netherlands are facing their second solvency crisis within a period of six years. As most Dutch pension funds effectively are arrangements of intergenerational risk sharing, especially the larger sector pension funds, the necessary recovery process implies various generational dilemmas. We distinguish various policy options, among them contribution rate increases and benefit cuts, and compare them on the aspect of intergenerational redistribution. Most pension funds in the Netherlands stem from the 1950s, and the current pension plan setting still reflects standards of that period. This practice is currently at stake. The introduction of a new regulatory framework built upon fair-value accounting and risk-based solvency supervision forces pension funds to reconsider their pension plan design and funding process. We discuss a number of reform proposals that currently are in debate.
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Bibliographic InfoPaper provided by Tilburg University in its series Open Access publications from Tilburg University with number urn:nbn:nl:ui:12-3710341.
Date of creation: 2009
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Other versions of this item:
- Niels Kortleve & Eduard Ponds, 2009. "Dutch Pension Funds in Underfunding: Solving Generational Dilemmas," Working Papers, Center for Retirement Research at Boston College wp2009-29, Center for Retirement Research, revised Nov 2009.
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- Kortleve, N. & Ponds , E.H.M., 2006. "Pension deals and value-based ALM," Open Access publications from Tilburg University urn:nbn:nl:ui:12-348156, Tilburg University.
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"How to close the funding gap in Dutch pension plans? Impact on generations,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-4561530, Tilburg University.
- Eduard Ponds & Niels Kortleve, 2010. "How to Close the Funding Gap in Dutch Pension Plans? Impact on Generations," Issues in Brief ib2010-7, Center for Retirement Research, revised Apr 2010.
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