|Date||2 October 2007|
Every year (of service) a participant in a pension scheme builds up pension rights. How much exactly, can be told from the prevailing accrual rate. At 1.75 percent, for example, the pension level reached after 40 years of service is 70 percent of the salary. In 2002, one in five participants enjoyed an accrual rate higher than 1.75 percent. Today, this applies for 92 percent of pension schemes participants.
This increase was phased in over several years. The first increase rise took place with the transition from final pay system to average pay system (2003-2004). The second increase came with the enactment of theWet VPL in January 2006 (‘Wet aanpassing fiscale behandeling VUT/prepensioen en introductie levensloopregeling’/ Act Amending the Tax Treatment of Early Retirement Pension and introducing the Life-course Savings Scheme). This Act abolishes tax benefits for pension rights built up for early retirement, and introduces the Life-course savings scheme, which enables employees to save for leave on an individual basis.
Both transitions were accompanied by compensatory measures. Besides lowering of the state pension offset (the amount deducted from the pension rights to be accrued; this amount is often based on the state pension), the accrual rates of many pension schemes were raised.