Bpf AVH, the industry-level pension fund for the agricultural and food supply chain, has once again started working out a transfer to Pensioenfonds PGB, this time with effect from 1 January 2021.
Breathing new life into the fund
Earlier, in 2019, this transfer was started only to be subsequently stopped again. At that time, the board of Bpf AVH considered the necessary reduction of the AVH pensions unacceptable. Both pension funds now see opportunities to give the transfer of pensions another go. The transfer is consistent with Pensioenfonds PGB's aim to grow, thereby increasing support for costs and investments. On Thursday 11 June it was decided to resume the transfer and on Wednesday 17 June an agreement was reached about this.
Why is the transfer now being reconsidered?
It is becoming increasingly difficult for Bpf AVH to arrange a good pension for all its participants and pensioners. Pensions are better off with a larger fund with a more favourable perspective. Pensioenfonds PGB is in a better financial position and offers more opportunities in terms of investments and services. It is also important to note that a reduction of the AVH pensions also seems unavoidable without switching to Pensioenfonds PGB.
What does this mean for participants of Pensioenfonds PGB?
There will be no effect on PGB participants’ pensions. Because Pensioenfonds PGB is in better financial shape than Bpf AVH, the AVH pensions will have to be reduced during the transition. This is necessary in order to bridge the difference in coverage ratio and to ensure that the transfer does not adversely affect the current PGB participants. Bpf AVH will take the decision on the reduction of AVH pensions, which will then be implemented in ten annual steps.
Transition not yet final
It is possible that the transition will not go ahead. In that case Bpf AVH will continue to exist as an independent pension fund. The transition requires the approval of the Dutch Central Bank (DNB) and the reduction of Bpf AVH's pensions must be within the limits set by the AVH board.