“The new pension act is absolutely my love child”

APG CEO Annette Mosman is walking with Wouter Koolmees, Minister of Social Affairs and Employment on behalf of D66 until January this year and, as of November 1, President of the Dutch Railways (NS). Together they look ahead, to the new pension system. “I am convinced that pension assets can be fairly allocated to all participants.”

No access to pedestrians. Wouter Koolmees and Annette Mosman have barely started their walk from Beverwijk to Wijk aan Zee, and they already have to stop. A prohibition sign. What to do? Take a detour and hope they’ll get back onto the walking route? Ignore the sign and stoically keep walking? They opt for the well-behaved variant. And it makes them both laugh, because as people born and raised in Rotterdam (Koolmees) and Amsterdam (Mosman), they should be used to dealing flexibly with these kinds of rules. After a slight detour, they get back onto the walking path, where they see a parking attendant. They ask him why that sign is there. “To protect pedestrians from possible freight traffic. But everyone ignores it. You’re the only ones taking a detour,” the man in the yellow vest smiles. Does he recognize the former minister? The man who spearheaded a thorough overhaul of our pension system? Koolmees stepped down as minister in January. Friend and foe praise his commitment, incredible dossier knowledge and intelligence. He himself remains modest: “I saw it as my job. But the new pension act is absolutely my love child. I worked on that with heart and soul.” He describes his departure figuratively: “Once you stop being a minister, your bag-full of documents is turned upside down. But your baggage remains. I will continue to follow all developments surrounding the introduction of the Future of Pensions Act very closely, because the subject is close to my heart.”   

Clear explanation

After a brisk climb up the dunes, Wouter and Annette suddenly have a full view of the immense grounds of Tata Steel. Smoking chimneys and coal-fired power plants, surrounded by the beautiful dune landscape. It makes them quiet for a minute. “Wow, this is the first time I’ve seen Tata Steel like this. The site is much bigger than I thought. You can really see the necessity and scale of the climate transition in one image here,” Annette says. That brings their conversation to the transition in the pension sector. 

Insiders understand the need for it, but very few pensioners and participants do. And so: how do you communicate with them? Wouter: “The pension discussions in the House of Representatives are always heavy on content. An outsider can’t understand any of it. I understand the importance of a clear explanation for both working and retired people. This summer, I spent three hours being interviewed by Cees Grimbergen of the TV program Black Swans. With the goal of explaining the how and why of the new pension act as clearly as possible. An interview like that is always a gamble, because you never know what quotes the media will run with.”

Having a real conversation

Annette agrees: “This is why pension funds and administrators tend not to want to engage with the media. And also to not have the real conversation with our participants. As a result, we don’t hear what their concerns are. What we do want to do: explain things to them. But that’s not enough; we really need to break through that. I was at a meeting about 100 years ABP. Minister Schouten spoke to some participants there, among them a police officer. A woman in her late 50s. She still has almost ten years to go until her retirement and has completely lost confidence in her pension fund. First her pension was based on her final salary, and later that was changed to the average salary. She knows that pensions have not been indexed for years, and meanwhile her opportunity to retire keeps moving further in to the future. “Pretty soon, I’m not going to be able to run after a crook anymore, and then what?” she sighed. In her eyes, we are not keeping our promises. I completely understand that. As a pension sector, we need to focus less on technical explanations and more on the experiences of our participants.”  

Feasibility

Annette notes that Wouter, – “quite exceptional for a minister” - during his time as minister, not only had an eye for the content but also for the implementation of the new act: “In other words, not only how pension funds arrive at the correct distribution of pension monies, but also how we, as administrators, operationally handle the transition. For APG, the transition does mean that we have to examine the files of some 4.5 million people and calculate what their new pensions will look like. We are therefore eagerly awaiting concrete policy decisions.” Of course, Wouter nods: “Because then you can proceed. I do think it just makes sense, however, that as a responsible minister you want to understand the feasibility of plans made. I hope that politicians will really take that into account sufficiently in the coming period.” For example, when it comes to the choice of what method will be used to convert collective pension assets into personal pension assets: the standard method or the VBA method (Value Based ALM). Wouter: “I have seen that there is discussion in the House of Representatives about the methods, but I am convinced that this can be resolved technically, so that the assets can be allocated fairly to all participants.”