Indexation: increase in accrued pension
Every year money loses some of its value. Your accrued pension also decreases in value due to inflation. That is why arrangements have been made to increase your pension. This is known as indexation. In doing this, we make a distinction between employees and former employees of Unilever, including pensioners.
The pension you accrue with us decreases in value over time. That is because of the increase in prices for goods and services. That is why Forward tries to increase your pension each year (as of 1 January). Such an increase in your pension is called indexation. Our goal is an indexation equal to the increase in negotiated (CLA) wages at Unilever. This is possible only if Forward has enough money for this; the coverage ratio (‘dekkingsgraad’) must be high enough. If there is not enough money, we cannot increase your pension.
Your accrued pension can even be reduced. The Board may decide to do so when our coverage ratio is too low according to the Dutch Pension Act, and a short-term increase is not likely to take place.
Forward was established on 1 April 2015. Forward has increased the pensions as followed:
| 1 January of the year | Indexation | Increase CLA-wages |
|---|---|---|
| 2025 | 3.00% | 3.00% |
| 2024 | 5.27% | 6.50% |
| 2023 | 3.50% | 4.54% |
| 2022 | 1.28% | 2.00% |
| 2021 | 2.75% | 3.27% |
| 2020 | 0.00%* | 0.00% |
| 2019 | 4.97% | 4.97% |
| 2018 | 0.00%* | 0.00% |
| 2017 | 3.43% | 3.43% |
| 2016 | 2.15% | 2.15% |
* On 1 January 2018 and 1 January 2020 no indexation was granted because there was no CLA wage increase in resp. 2017 and 2019.
It is Forward's goal to increase the pension of former employees and pensioners every year. Our target is a yearly indexation (as of 1 January) that equals the increase of prices in the Netherlands (CPI derived). This is possible only if Forward has enough money for this; the coverage ratio (‘dekkingsgraad’) must be high enough. If there is not enough money, we cannot increase your pension.
Your accrued pension can even be reduced. The Board may decide to do so when our coverage ratio is too low according to the Dutch Pension Act, and a short-term recovery is not likely to take place.
Forward was established on 1 April 2015. Forward has since increased pensions as follows:
| 1 January of the year | Indexation | Target (CPI derived) |
|---|---|---|
| 2025 | 2.58% - 1.98% (= correction 2024) |
2.58% |
| 2024 | 0.00% | -1.98% |
| 2023 | 13.04% | 16.93% |
| 2022 | 2.10% | 3.28% |
| 2021 | 0.16% | 1.12% |
| 2020 | 1.73% | 1.73% |
| 2019 | 1.68% | 1.68% |
| 2018 | 1.34% | 1.34% |
| 2017 | 0.36% | 0.36% |
| 2016 | 0.44% | 0.44% |
The coverage ratio shows us the relation between the capital (the value of our investments) and the pension obligations (the value of all future pension pay outs) of a pension fund. A coverage ratio of 100% means that a pension fund has just enough money to pay out all the pensions it is obliged to. Now, and in the future.
To determine whether an indexation is possible or not, the Board looks at the so-called ‘beleidsdekkingsgraad’. That is the average coverage ratio of the past 12 months. Unilever Netherlands and Forward made clear agreements about indexations; these are dictated by the Dutch Pension Act. This means that an indexation is only possible if it is expected that indexations will also be possible in the long term future.