The indicative average funding ratio of Dutch pension funds fell by 4 percentage points to 116 per cent in March, according to analysis by Aon.

The decline was primarily attributed to falling interest rates over the month, with liabilities increasing by more than 4 per cent.

Despite the fall in funding ratio, the investment portfolio achieved a positive return of 1.2 per cent.

The indicative funding ratio, which is based on the average funding ratio over the past 12 months, remained the same at 121 per cent.

Pension funds main challenge in March was dealing with the consequences of falling interest rates, after US bank Silicon Valley Bank collapsed and Credit Suisse was mandatorily taken over by UBS.

Equities fell by around 5 per cent early in the month before calm returned towards the end of the month.

Ultimately, this resulted in an equity return of 1.3 per cent for developed markets and 0.6 per cent for emerging markets.

Real estate shares fell by more than 5 per cent, while fixed income assets rose by 4.4 per cent, primarily due to the good performance of interest-sensitive government bonds.

“The most important thing now is not to panic,” said Wealth Solutions Netherlands CEO, Frank Driessen.

“Pension funds invest for the longer term, so it is good to keep an eye on long-term principles in periods of rapidly changing circumstances.”

Commenting on the transition to the Future Pensions Act, Driessen noted that it was clear that there were concerns about the economic situation at the time of introduction and guaranteeing the current amounts that members will receive.

“It is important that the transition is done right the first time,” he continued.

“It is therefore important to get the data quality right now, if that is not the case. Important in this respect is the recent court ruling that no rights can be derived from the Uniform Pension Overview.

“If this line is continued, you could also see it that way for the overviews that participants will receive when they enter. In addition, there is no individual right of consent.

“Participants therefore have little or no opportunity to object to the entitlements they are awarded after entry. This means all the more that it must be done properly and carefully.

"There's a lot to do. Don't underestimate the amount of work. This is a huge change and resources are limited.”

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