The Dutch fund Pensioenfonds Zorg and Welzijn (PFZW) is broadening its indexation policy to better help its members in the face of persistently high inflation.

The fund said it is aware that its members, in the healthcare and welfare sectors, were struggling with the cost-of-living crisis.

It will release details in mid-November 2023 on how this impacts pension increases in 2024.

Inflation and coverage ratios at 30 September 2023 determine the pension increases for the next year. No reductions to pensions are expected in 2024, PFZW stated.

In 2026, PFZW is aiming to switch to the new pension system being implemented in the Netherlands, with its existing pensions converted to the new scheme.

The board of PFZW will follow the rules of the Financial Assessment Framework (FTK) during the transition period.

It also submitted a bridging plan to De Nederlandsche Bank (DNB) at the end of August.

“PFZW will convert pensions in a balanced way to the new pension rules,” the fund stated.

"We will explicitly look at the interests of young and old. Money that is now used to increase pensions will soon no longer be available to young people. Therefore, increases in pensions can be higher as the coverage ratio is higher.

"Moreover, there is also a margin left to absorb setbacks."

PFZW aims to convert pensions with a coverage ratio of at least 95 per cent, as of 1 January 2026.

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