Flexibilization of the Old-Age Pension Commencement Date Act
In mid-February 2016, member of the Lower House of Parliament Norbert Klein submitted a legislative proposal to amend the General Old Age Pensions Act and Participation Act in connection with the introduction of the option to begin payment of the pension under the General Old Age Pensions Act earlier or later than the statutory retirement date.[1] This legislative proposal, also known as the ‘Flexibilization of the Old-Age Pension Commencement Date Act,’ opens the option to allow the statutory pension to begin up to five years earlier or later than the date on which the pension-entitled person reaches the statutory retirement age.
For ITEM, the legislative proposal was a reason to call attention, by means of a letter to the Standing Committee for Social Affairs and Employment, to the position of employees who have accrued both a Dutch general old-age pension and a foreign statutory pension.[2] For this group of employees (for example, migrant workers, labour migrants, and frontier workers), the flexible pension start date could have a positive outcome. Frontier workers are confronted with the fact that the statutory retirement ages in the Netherlands, Belgium, and Germany are all different. The Dutch general old-age pension (65 years + 6 months) starts later than in Belgium (65 years) or in Germany (65 year + 5 months)
A frontier worker who has accrued statutory pension both in the Netherlands and in one of these two neighbouring countries will, at the moment of receipt of this foreign statutory pension, still have to ‘wait a while’ for the Dutch retirement benefit. This can have an impact on a frontier worker’s income position.
Legislative proposal
The legislative proposal for flexibilization of the old-age pension commencement date offers the frontier worker the option to coordinate the start of his or her Dutch pension with the start date of the foreign statutory pension. Unlike in the current situation, the frontier worker will be able to claim payment of benefits from his or her accrued statutory pensions to commence from the same start date. An example calculation is provided in the full report.
Despite this positive impact on frontier workers, ITEM observes that, now that the legislative proposal has been put on the agenda for panel discussion in the Lower House of Parliament (scheduled for the end of October 2016), nowhere does the legislative proposal, explanatory memorandum, or any of the extensive commentary in the Standing Committee for Social Affairs and Employment devote any attention to the potential impact of the legislative proposal on frontier workers, even though two motions, in 2009 and 2012, referred to the importance of ‘continuing attention to the issues of frontier workers.’[3] In 2015, the importance of conducting a cross-border impact assessment, identifying effects on frontier regions during the legislative process, once again came into the spotlight as a number of political parties expressed an interest in this discussion.[4] If the legislator had introduced such a ‘review’ in the Flexibilization of the Old-Age Pension Commencement Date Act dossier, then it would have been clear that the legislative proposal for the Flexibilization of the Old-Age Pension Commencement Date Act could have a positive effect on the frontier workers who have accrued both a Dutch general old-age pension and a foreign statutory pension.
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[1] Parliamentary Documents II 2015/16, 34414, no. 2 (Legislative proposal by Member of Parliament N.P.M. Klein to amend the General Old Age Pensions Act and Participation Act in connection with the introduction of the option to begin payment of the pension under the General Old Age Pensions Act earlier or later than the statutory retirement date (Flexibilization of the Old-Age Pension Commencement Date Act).
[2] The relevant passages/findings of this letter to the Standing Community for Social Affairs and Employment are given in the full report.
[3] Parliamentary Documents II, 2011/12, 33000 IXB, no. 21 (Bashir motion). This motion refers in part to a motion submitted by Weekers (and adopted) in 2009 (Parliamentary Documents II 2009/10, 26 834, no. 26) and referring to the importance of devoting attention to the frontier worker issue.
[4] Parliamentary Documents II, 2014/15, TK50, 4 February 2015 (Cross-border impact review).
