The funding level and the policy funding level are published around the 10th working day of each month.
Funding level on March 31, 2024: 123.4%
Policy funding level on March 31, 2024: 126.9%
The policy funding level is used to make decisions on indexation. The policy funding level is the average of the last twelve months of funding levels.
Click here for more information about the monthly development of the funding level.
Funding level evolution
The pension fund’s funding level rose by 0.4 percentage points to 123.4% at the end of March. During March, share markets achieved a positive return. Interest rates fell, which had a negative effect on the funding level due to the fact that the pension fund hedges part of the interest rate risk. On balance, the funding level result was positive.
Global equity markets continue to set new record highs. The most recent economic data from America present a robust picture. The purchasing managers’ index, a key leading indicator, points to a growth in American industry. The American labour market is also still showing signs of positive development. Unemployment has continued to fall and overall expectations are that the US economy will experience a soft landing. Much will also depend on inflation developments. While inflation is falling, it is not falling as fast as initially expected. This increases the likelihood that the US central bank will show reluctance to cut policy rates in June.
The picture is markedly weaker with respect to the eurozone economy, with particularly Germany and Italy seeing a contraction in economic activity. Inflation in the eurozone is falling slightly. As a result of these developments, the consensus in the market is that the European Central Bank is more likely to cut its policy rate in June.
In Japan, the central bank raised policy rates for the first time in 17 years. The Japanese central bank was the last central bank to maintain a negative interest rate.
The Board will continue to monitor developments closely.
The table below shows the quarterly funding levels in previous years. The table also shows the interest rate we are obliged operate (the market interest) and the returns.
The quarterly funding level is adjusted a few weeks before the end of each quarter.
| Position at the end | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | 2022 | 2021 | 2020 | 2019 | 2018 |
| Funding level | 120.2% | 133.1% | 127.2% | 125.6% | 123.7% | 115.5% | 99.7% | 104.0% | 105.0% |
| Policy funding level | 127.9% | 128.7% | 128.5% | 129.1% | 127.1% | 108.9% | 95.5% | 102.3% | 109.3% |
| Interest | 2.4% | 3.2% | 2.7% | 2.6% | 2.7% | 0.5% | 0.1% | 0.7% | 1.3% |
| Return up to | 8.7% | -2.2% | 3.9% | 2.9% | -13.8% | 8.2% | 4.0% | 12.7% | -1.8% |
The variable net pension benefit is adjusted annually on the basis of the result achieved in the previous year. This result includes the return on investments, the development of market interest rates, and the result on death within the group of pensioners who have a variable net pension benefit.
| As at end of | 2023 | 2022 | 2021 | 2020 | 2019 |
| Funding level | 99.25% | 109.53% | 113.36% | 96.89% | 89.53% |
| Result | -0.75% | 9.53% | 13.36% | -3.11% | -10.47% |
| Average interest rate | 2.50% | 2.90% | 0.46% | 0.00% | 0.50% |
| Return | 7.37% | -15.83% | 6.46% | 4.40% | 12.39% |
The total result achieved for the group in 2023 is -0.75%. Despite the positive return on investments over 2023, this (small) negative result is largely due to the decrease in interest rates in 2023. As a result, PDN needs to reserve more money to pay future variable net pension benefits.
PDN divides the achieved results over 5 years. Based on the result for 2023, the reduction in the variable net pension benefit for 2024 to 2028 is therefore equal to -0.18% per year.
For more information, please see the Brochure 'Indexation’.