Dutch pension fund PME reported a rise in its current funding ratio from 113 per cent to 125.3 per cent in 2025, with the stronger financial position allowing it to increase pensions by 2.82 per cent from 1 January 2026, its annual results have shown.

The fund attributed the increased funding ratio to rising interest rates and a positive return on its investment portfolio.

According to the results, the fund’s total asset management costs (including transaction costs) increased slightly in 2025, from 0.397 per cent in 2024 to 0.414 per cent of assets under management.

However, the cost per participant for managing pensions increased from €115 to €178, which the fund credited to temporary additional investments as it prepares for the transition to the new Dutch pension system in 2027.

The results also showed that PME received a "good return" of 9.2 per cent on its return portfolio, due to the resilience of the global economy.

Meanwhile, the return on the matching portfolio was strongly influenced by the increased interest rates and in line with the decline in the value of pension liabilities, this portfolio recorded a negative return of almost 18 per cent. The return on the total investment portfolio amounted to -3.0 per cent.

The fund’s goal is that the average return on its investments in the long term must be at least 1.5 per cent per year higher than the return on the pension obligations.

PME has achieved this, and over the past 15 years, the average return on the portfolio has been 4.85 per cent, compared to 1.84 per cent for liabilities.

The fund also believes investing in the Netherlands yields a positive and social return, and by the end of 2025, approximately 15.7 per cent of the total investment portfolio will be invested in the country.

Since 2023, its invested assets in the Netherlands increased from €7.9bn to €9.3bn in 2025.

In 2025, the fund undertook work to strengthen the fund’s foundations for the switch to the new Dutch pension system as of 1 January 2027.

According to PME, the first funds have now successfully migrated to pension administrator TKP. Based on these results, the fund has concluded that the planned transition date is achievable and the risks are manageable; the need to invoke contingency plans has therefore greatly diminished.

Looking ahead to the current year, PME Executive Board chairman, Alae Laghrich, said: "We started 2026 with a healthy funding ratio of around 125 per cent. A strong starting point in a tumultuous world, although we are keeping an open mind: the year is still long, and developments follow each other in rapid succession.

“This year is all about preparing for the new scheme in 2027. Last year, we already reached thousands of participants through physical meetings in theatres across the country and in the workplace. In addition, we informed our supporters through webinars, newsletters and the PME Magazine.

“In 2026, we will shift up a gear. This autumn we will make the switch in person: then we will communicate the provisional individual amounts, and everyone will get to see in concrete terms what the new scheme means for them.”

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