Budget setback as WAO re-testing is delayed

11th March 2005, Comments 0 comments

11 March 2005, AMSTERDAM — The reassessments of whether every incapacitated worker in the Netherlands should still receive a WAO pension are behind schedule. Only half of the planned re-evaluations are expected to be carried out this year.

11 March 2005

AMSTERDAM — The reassessments of whether every incapacitated worker in the Netherlands should still receive a WAO pension are behind schedule. Only half of the planned re-evaluations are expected to be carried out this year.

It means that WAO recipients, whether really unable to work or not, could continue receiving the pension for some time, representing a financial setback for the  Dutch government that has dedicated itself to cutting spending across the board.

Social security authority UWV — which is in charge of WW unemployment benefits and the WAO pension — started re-evaluating 325,000 WAO recipients in October 2004 to determine if they are still entitled to the benefit.

Stricter conditions are being applied during the re-evaluations and some 246,000 WAO recipients were scheduled to be assessed this year.

But confidential, internally circulated, UWV figures indicate that this goal will not be met. The goal to finish the assessment process by March 2007 is also in doubt. The other 575,000 recipients will be re-assessed based on older, less restrictive regulations, newspaper De Volkskrant reported on Friday.

The revelations come after recent news that the first 14,000 re-assessments indicated that 50 percent of the WAO recipients could be paid reduced pensions or be removed form the system completely.

Assessment delays thus represent a financial setback for Social Affairs Minister Aart Jan de Geus, who had been counting on significant savings and welcomed the preliminary cutbacks.

With close to 1 million WAO recipients out of a workforce of 7 million, the burgeoning worker disability pension system was partly blamed for bringing an end to the Dutch economic boom at the turn of the century.

UWV management has since been informed by staff that about 120,000 of the planned 246,000 reassessments will not be completed this year. The reassessment department said the delay can be eliminated by hiring extra staff, but budgetary restraints and shortage of available staff present problems.

Meanwhile, the Cabinet officially decided on Friday that a new, stricter WAO system would be introduced from 1 January 2006. In the new system, only fully incapacitated workers with little chance of recovery will come into consideration for a pension.

Also, private insurers will be forced to compete with the UWV in a scheme designed to push both the UWV and insurers to get injured workers back to work quicker, news service NOS reported.

But private insurers are concerned by the speed with which the system will be introduced, claiming they will not start on an even playing field with the UWV

Initially, private insurers will be forced to charge higher premiums than the public authority UWV because they have not built up a WAO fund to act as a reserve. They claim the government's offer of compensation is too low.
 
The Dutch Association of Insurers has sent a letter to Minister De Geus and the Labour PvdA — which has in the past called for a completely privatised system — has called for an emergency debate in Parliament.

[Copyright Expatica News 2005]

Subject: Dutch news

0 Comments To This Article