Fourteen Dutch pension funds will have to cut their pay-outs to pensioners within a few months, it is widely reported on Wednesday. The cuts will affect around 700,000 people, of whom 150,000 will feel the direct effect because they are already retired.

The reduction in pensions was announced on Tuesday evening by acting social affairs minister Piet Hein Donner and the central bank. Because of its duty of confidentiality, the bank cannot say which pension funds are affected.
The pension funds have been hard hit by the economic crisis and several have seen their coverage ratio fall below the required 105%.
Reductions in pension pay-outs will vary from 1% to 14% and will be introduced on January 1. The hardest hit will be those who have already retired. The under-65s still have time to make other savings or may see the financial situation improve.
The cuts are a direct result of Donner’s decision to terminate an exemption measure for weak pension funds. He made the decision on the advice of the central bank because members of the 14 pension funds involved are receiving a pension that is not fully covered.
In 2009 it emerged that 340 of the 600 pension funds are short on coverage. Most of them think this can be solved by increasing premiums, no longer correcting for inflation or through financial help from employers.