On July 1st 2023, the new Pensions Act came into force: Future Pensions Act (WTP). By January 1st 2028, all pension schemes must be adapted to the new legislation. With changes to the three pillars that make up the pension system, it represents the biggest and most far-reaching adjustment in the pension system ever. Processing all the changes within the existing systems of investment and pension administrations requires robust software. In cooperation with KPMG, VI Company developed the Performance Allocation module within the software solution Alloq, including a dashboard with an overview of performance. The tool provides asset managers with the necessary tools to implement the crucial aspects of the new pension system in a qualitative, efficient and cost-conscious manner.
In the new pension system, social partners can choose between two contracts, the Solidary Premium Scheme and the Flexible Premium Scheme. The Solidarity Premium Scheme has more elements of risk-sharing, while the Flexible Premium Scheme focuses on more individual freedom of choice. For pension funds, asset managers and pension delivery organisations, the distribution of returns across age cohorts presents a challenge. Not only which allocation keys and other criteria best fit the risk attitude of the respective pension fund’s member population. But it is also very important to comply with all legal requirements when determining the allocation keys and other choices to be made.
To facilitate this challenging process, Alloq, a software solution developed by VI Company, has built the Performance Allocation module. With this module, Alloq provides asset managers with the necessary tools to implement the crucial aspects of the new pension system in a qualitative, efficient and cost-conscious manner. It can be seamlessly integrated within existing administration, including details that parties can define themselves.