Dutch pension fund ABP has announced that it will be increasing pensions by 11.96 per cent from January 2023.

This is equal to the rise in inflation for the period from September 2021 to September 2022.

The increase will apply to pensioners, members who are currently accruing an ABP pension, and people who have accrued a pension with ABP in the past.

ABP stated that its financial position has allowed it to make the increase, with its current funding ratio being 125.5 per cent at the end of October 2022, and its policy funding ratio standing at 118.1 per cent.

Furthermore, the fund’s ability to use more flexible rules, as it has indicated that it wants to switch to the new pension system, also helped enable it to make the increase.

ABP’s accountability body advised that it was possible to make the increase to members’ pensions.

“It is great to be able to fully increase pensions in 2023 with the price increase. Nearly 12 per cent more,” commented ABP board chair, Harmen van Wijnen.

“All participants will benefit from this in the short or longer term. Hopefully it will give our pensioners some breathing space now that prices have risen so much. Because with a pension of €1,000 net, that still means about €120 extra per month.

“We did not take this decision overnight. Apart from the fact that the calculation must be correct according to the rules, we have checked whether this increase does not harm the interests of groups of participants.

“And we have also looked ahead, because we must remain financially healthy in the longer term to enable a smooth transition to the renewed pension system. Especially in the troubled times we live in now, it's good to keep some fat on the bones.

“After weighing all this, we found that a full increase of almost 12 per cent is responsible and balanced.”

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