This is an old article. View all Updates information about pensions in the hospitality, catering and recreation.
In our members’ magazine hospitality Info at the end of last year, you could read that we were not yet able to say with certainty what would happen this year with the pension premium and accrual in recreation. We now know. Pensioenfonds Recreatie has decided to increase the premium and reduce the accrual. Measures we would have preferred not to see, but the fund could not postpone. Pensioenfonds hospitality & Catering has not had to take these measures. Nor does it need to reduce pensions. Furthermore, we cannot yet say anything about heavy occupations that could claim a scheme to retire earlier, as a working group is still considering this.
Pensioenfonds hospitality & Catering: no reduction, formation of special reserve stops
The coverage ratio of Pensioenfonds hospitality & Catering rose to 109% at the end of 2019 due to an increase in interest rates. As a result, the coverage ratio is so high that pensions do not need to be reduced. The measures by Minister Koolmees of Social Affairs and Employment to prevent possible reductions are not even needed by the pension fund. Additionally, the pension accrual and premium remain the same.
However, we have agreed with the pension fund that from 1 January 2020, no more premiums will be added to a special fund called the equalisation reserve. The reason for this? In the event of a possible reduction in pensions, the pension fund is obliged to use this fund first to partially prevent a reduction. But this fund is not intended for that. By no longer adding premiums to this fund, the ratio between the premium you as an employee pay and the actual costs of the pension will improve in the coming years.
Additionally, we have agreed to use the over €120 million that the special fund contained at the end of 2019 to improve this ratio. This prevents a possible discussion that employees and employers are not paying enough premiums.
Pensioenfonds Recreatie: increase in premium, reduction in accrual
At the end of 2014, Pensioenfonds Recreatie fixed the interest rate for five years. That period ended at the end of 2019. During this period, interest rates have fallen sharply. As a result, pensions have become more expensive. If the pension fund continued on the same path, it would not end well. Then the fund would no longer meet legal requirements. Therefore, the pension fund is legally obliged to take measures. From 1 January 2020, the premium has increased and the accrual rate for the old-age pension has decreased. We at FNV Recreatie find it very unfortunate that the measures announced by Minister Koolmees in November 2019 and our letter to him have not been able to prevent these measures.
What exactly do the measures entail?
The pension premium in recreation is increasing to 21.8% (it was 19.6%). The employer and the employee will together pay more for the pension accrual. Part of that increase (0.7%) is intended for the new partner pension that will apply to all employees (see further on). The accrual rate is decreasing to 1.403% (it was 1.592%). So you will build up less pension for the pension premium you pay. Pensions cannot increase with prices (indexation) in the coming period.
Partner pension is insured
In 2019, we agreed to insure a partner pension for all employees from 1 January 2020. That agreement remains in place. Until now, there was no partner pension if you as an employee died before your partner passed away. That situation is coming to an end. Suppose you as an employee die, then your surviving partner will receive 57% of the pension you could have built up if you had continued working in recreation until your 67th (pension reference age). The premium for the partner pension is 0.7% and is already included in the increase in the pension premium mentioned above. The Anw pension that you can take out yourself with the pension fund also continues to exist. You pay the premium for this scheme entirely yourself.
Pension reduction in 2020 not an issue
In 2020, Pensioenfonds Recreatie does not need to reduce pensions. Partly due to the measures of Minister Koolmees. For now, that is good news. But if the coverage ratio of Pensioenfonds Recreatie does not improve sufficiently in 2020, a reduction in pensions from 1 January 2021 cannot be ruled out. An important factor for the level of the coverage ratio is the interest rate. This is still very low.