The Wtp transition: Lessons learned from Paul van Gent (BpfBOUW)
This special was originally written in Dutch. This is an English translation.
Paul van Gent, Bestuurslid, BpfBOUW, made the switch to the new pension system on 1 January 2026. He shared his experiences with Financial Investigator.
By Esther Waal
How did the transition go?
‘Successfully. It was a very intensive and complex process involving many stakeholders. The most important of these were the social partners and our own fund bodies (VO and RvT), our administrator APG and the supervisory authorities DNB and AFM. Preparations for the transition started as early as 2021, i.e. before the Wtp was passed by the Senate on 30 May 2023. A new scheme was needed and the transition had to be designed. This was primarily a process between the fund and social partners and involved a great deal of exchange. At our administrator APG, the emphasis was on data quality and preparing the new processes and systems. For example, a connection had to be established between the pension administration and asset management. In the old system, these administrations were separate from each other because there was no direct link between returns and individual entitlements.’
Why was January 2026 chosen as the date for the transition?
‘The most important factor was that the fund and social partners had a lot of confidence in the new system and wanted to reap its benefits as soon as possible. Those benefits mainly lie in the much smaller buffers, which means that returns reach our participants much sooner. The earliest possible date on which we could make the transition was 1 January 2026. We went for that and we achieved it.’
The most important lesson is to continue to monitor frequently in the run-up to the transition date which portfolio composition and interest rate hedging should be targeted after the transition.
Were any adjustments to the portfolio necessary?
‘Limited adjustments to the portfolio were necessary to bring it into line with the strategic investment policy under the new SPR. These primarily involved adjustments to the allocations to liquid asset classes. These adjustments took place without any problems at the beginning of January. The necessary adjustments were not so much due to conscious choices to adjust allocations, but were mainly prompted by the fact that the distribution between matching and return is dynamic under the SPR. Secondly, there were adjustments to the allocations to less liquid asset classes. These have been started, but will be implemented gradually over a longer period of time. Finally, there was the increase in interest rate hedging. This was necessary because under the Wtp, interest rate hedging is dynamic, depending on the development of pension assets. The increase in interest rate hedging was implemented in stages and has now been completed.’
What are the most important points of attention now that the transition is complete?
‘With regard to the investment portfolios, this involves monitoring the extent to which the standard allocations for matching & return and the target for interest rate hedging vary and what adjustments (in terms of frequency and scope) are needed. A policy has been formulated on how to deal with deviations in the actual portfolio. This policy is being tested in practice.’
What is the most important lesson for parties that are yet to make the transition?
‘The most important lesson is to continue to monitor frequently in the run-up to the transition date which portfolio composition and interest rate hedging should be targeted after the transition. Because both the distribution between matching and return and the interest rate hedge are dynamic under the SPR, these are not fixed targets. By having a clear picture of what needs to be managed, an assessment can be made as to whether this can be achieved immediately after the transition, or whether it will take longer. In the latter case, consideration may be given to initiating certain adjustments before the transfer date in order to limit the deviations from the strategic investment policy – which reflects the risk appetite – both in terms of scope and duration after the transfer.’
Read the original special in Financial Investigator magazine