Modified pension plan ratified

Legislative and regulatory changes caused the social partners (the employer and the trade unions) to modify the CDC pension plan. ING CDC Pensioenfonds has reviewed the changes, and has concluded that the modified pension plan is financially feasible, justifiable and suitable for administration. It is important for you to bear in mind that these changes have an impact on your pension accrual and the indexation of your pension.

The following changes have been implemented:

• As from 2015, the pension fund aims at building up your pension at a rate of 1.875% of your pension base (the rate for 2014 was 2%). Your pension base is equal to the maximum amount allowable for tax purposes. We will explain this below.
• You do not build up pension over a part of your salary, as you will be receiving old age pension benefits from the Dutch state (AOW) for this part of your salary. This part of your salary is referred to as the “franchise”. In 2014, the franchise was fixed at a level of € 15,000. The level of the franchise has been lowered to the minimal level allowed by law, which is € 12,642 for 2015. This means that you now start building up pension from a lower salary level. Your salary in excess of the franchise (€ 12,642 in 2015) accrues pension and is referred to as your pension base.
• Salary for which you build up pension and pay contributions has been capped at € 100,000 (in 2014 there was no maximum). This follows from changes in tax laws and regulations.
• As a result of the lower franchise level, a larger proportion of your salary (below € 100,000) accrues pension. This would mean your contribution should also increase, but it was agreed that the employee’s contribution would remain unchanged.
• In order to retain the value of the pension you accrue, the pension fund aims at indexating your pension every year. With effect from 2015, indexation levels will be linked to consumer price changes. Until 2014, indexation had been based on salary changes at ING Bank. The level of future indexation will continue to depend on the financial position of ING CDC Pensioenfonds.
• As from 2015, indexation rates will be calculated according to a different method. For example, the fund must now take into account the policy funding rate and comply with stricter capital adequacy requirements. Would you like to know more about this? Later this year, the fund will publish sample calculations on the website.

Uniform Pension Overview 
Being the administrator of the pension plan, ING CDC Pensioenfonds will keep you informed about developments regarding your pension. If you work for ING Bank, you will receive a Uniform Pension Overview (UPO) in June, based on the situation of your pension on 1 January 2015.

At the same time, you will receive a UPO from Pensioenfonds ING (provided you were employed before 1 January 2014), so you will have a complete picture of all of the pension you have saved while working for ING Bank and possibly for NN Group. 

Pension Planner
Given all the changes regarding pensions, it is more important than ever before to make sure you thoroughly understand your pension. It is advisable for you to check whether your pension is still on track and to decide what action you should take if your pension is not as much as you thought it would be. This summer, ING CDC Pensioenfonds and Pensioenfonds ING will jointly launch a Pension Planner that will give you insight into your personal situation.