The two biggest Dutch pension funds – ABP and Zorg & Welzijn – are now extremely likely to be faced with cutting pensions for teachers, civil servants and healthcare workers next year.

Both funds’ coverage ratio fell to below 95% in July – which means they only have assets to cover 95% of their pension responsibilities. If the coverage ratios do not improve by the end of December, cuts will have to be made.

The two funds are responsible for the pensions of 5.8 million people and are among the biggest in the world.

Engineering pension funds PME and PMT have been in the danger zone for longer and also facing making cuts unless their coverage ratios top 100% at the end of the year.

The funds have been hit by low interest rates but a downturn on the stock markets is now also having an impact, the Financieele Dagblad said.

ABP, for example, said it had earned €8bn on its investments in July but that was not enough to prevent its coverage ratio falling from 95.3% to 93.9%.