Netspar papers on projected interest rates in dc schemes

The new Dutch legislation for DC pensions, which makes it possible to take investment risk in the retirement phases of DC schemes, went into effect on September 1, 2016. Netspar has written several reports for the Dutch Ministry of Social Affairs and Employment (SZW) related to this legislation. The most recent report was published by the ministry on December 15, 2016. Netspar researchers also wrote a number of  other papers related to the new legislation that we are making available as a group.

All papers address the impact of the regulation of assumed interest rates through the so-called “projection rate and fixed decline” (which among others determine the level of the first distribution payment) and investments. The focus is on the prevention of re-distribution, but also on what is needed in order to achieve objectives such as a nominally stable distribution of pension wealth and the avoidance of a high risk of income reduction in the first benefit years. In addition, the papers discuss the impact of investments, projected rates and fixed declines in the expected benefits and the uncertainty therein. A (too) high projected rate, or (too) high fixed decline for instance implies a higher initial payment, but also to the deterioration of the life-long nature of the benefit.

For more information on how the different papers relate, please download this preface (only available in Dutch).

Research reports and background papers

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.

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