Philips Pensioenfonds will raise its pensions at 1 April 2026 by the full rate of its ambition. The pensions of our pension beneficiaries and non-contributory policyholders will be raised by 2.1% at 1 April 2026, in full compensation for last year’s price inflation. Price inflation is the rate of movements in the derived consumer price index as established by Statistics Netherlands for the period from January 2025 to January 2026. The accrued pensions of our existing active members will go up by 3.0%, which matches the rate of wage inflation. Wage inflation is based on the Philips salary scale adjustments under the collective labour agreement, including for employees of Signify and Versuni. This indexation is made possible by more lenient legal rules for indexation.
This is an important step forward in realising our goals for switching to the new pension plan. The impact of this indexation decision on our financial buffer is an acceptable one.
Bridging Plan
In the bridging plan you can read why applying the more lenient indexation rules is a sensible decision given the pension fund’s finances, and how it will affect our members in the different age categories.
Each of our members has received personalised information about their pension increase at 1 April 2026. This news item provides a brief explanation of the indexation decision. Further down you will also find a Q&A section about indexation in general (for example, ‘Why can no compensatory indexation be granted?’) and about the Bridging Plan. The Bridging Plan is based on calculations of how the separate groups of members are affected by the more lenient indexation rules.
Indexation allocation
How much pension increase the Board can provide in any given year depends on several factors. Here you will find an overview of news items with decisions in recent years.
Overzicht van eerdere nieuwsberichtenWhat do we hope to achieve by the time we switch to the new NexT Pension scheme?
In late-2021, Philips Pensioenfonds mapped out what was needed for all its members – active members, pension beneficiaries and non-contributory policyholders – to get off to the best possible start under the new pension system:
- When we make the switch, we want each member to have a pension that is as close as possible to our ambition. That ambition is full pension accrual and full indexation. Any differences between members at the time of the switch need to be fair and justifiable. Given our ambition, we have decided to apply the more lenient legal indexation rules (see also: ‘What is the legal maximum for raising the pensions?’).
- We want the highest possible funding ratio when we make the switch. The financial buffer will be used, directly or indirectly, for our members’ benefit, and so every year until then we consider what a judicious rate is for raising the pensions (indexation) while still protecting that buffer. This means that the indexation rate depends not only on what the law allows and the financial situation at the indexation moment, but also on what we want and expect the financial situation to be when we switch to the new pension scheme (which is scheduled for 1 January 2027).
What is the legal maximum for raising the pensions?
If a pension fund does not apply the more lenient indexation rules under the transitional financial assessment framework, it may not grant any indexation at all if its policy funding ratio is lower than 110%, and full indexation is permitted only if full indexation is also certain in the future. At this time (the threshold varies over time), for Philips Pensioenfonds this means a policy funding ratio of 138.7% (to find out more, click here). If we did not apply the more lenient indexation rules under the transitional financial assessment framework, with our current funding ratio of approximately 125%, we would only be allowed to grant partial indexation: specifically, 52% of our ambition. Over the entire period in which we have applied the more lenient indexation rules (i.e. going back to 2024), we would not have been able to realise 100% of our ambition, but only 54%.
Instead, by applying the more lenient rules we have been able to award full indexation since 2024.
Compensatory indexation still impossible, even under the more lenient indexation rules
Compensatory indexation is governed by the existing indexation rules. It is possible only if the policy funding ratio passes a threshold defined by law. For Philips Pensioenfonds, that threshold was 138.7% at the end of December 2025. Since the policy funding ratio was far lower, at 125.2%, we are not legally allowed to grant compensatory indexation at this time.
What is a sensible indexation rate in 2026?
Our conclusion is that we can index all our pensions at 1 April 2026 with the full rate of our ambition. We believe that this is a sensible decision: the pension fund is in a strong financial position and this is the final indexation moment under the existing pension plan. As in previous years, the decision is based on the maximum increase permitted under the legal rules, the difference between price inflation and wage inflation and the movements in indexation arrears between separate groups of members. Granting full indexation to all the groups prevents those arrears from becoming worse and helps to limit the differences between the groups. The decision will also have a relatively minor impact on the funding ratio, and matches our goal of maintaining a healthy buffer as we approach the switch to the NexT Pension scheme.
How will this affect pension beneficiaries and non-contributory policyholders?
Non-contributory pensions and pensions that are being drawn will go up by 2.1% at 1 April 2026
The pensions of our pension beneficiaries and non-contributory policyholders will be increased by the full rate of last year’s price inflation. This indexation is made possible by more the lenient legal rules for indexation. This is also the maximum rate that is allowed by law.
How will this affect active members?
The accrued pensions will go up by 3.0% at 1 April 2026
We will raise the pensions that our active members have accrued in accordance with the full rate of wage inflation over the past year (which corresponds to the collective salary scale adjustments at Philips, including for active members who work for Signify or Versuni). This full indexation is made possible by more the lenient legal rules for indexation. This is also the maximum rate that is allowed by law.
Pension accrual rate for 2026 is 1.85%
This accrual rate for 2026 is the same as the rate of our ambition.
Questions Bridging plan
In the bridging plan you can read why applying the more lenient indexation rules is a sensible decision given the pension fund’s finances, and how it will affect our members in the different age categories.
With the transitional financial assessment framework, more lenient indexation rules became available for pension funds to use on 1 July 2023, which is when the Dutch Future of Pensions Act (Wet toekomst pensioenen) came into force. To apply those rules, pension funds need to substantiate why it is in the best interests of their members to apply the transitional financial assessment framework, and what the effects are. This includes calculating how the members are affected by the more lenient indexation rules, and what the consequences are for the pension fund’s financial position. It also requires substantiating how these effects are ‘balanced’. This is then recorded in a ‘bridging plan’, which is reviewed by the Dutch central bank (DNB).
Philips Pensioenfonds’s bridging plan came into place on 1 January 2024. Philips Pensioenfonds submitted its bridging plan to the Dutch central bank (DNB) in January 2024. The plan was approved in February, and now the more lenient indexation rules may be used for the decision about indexation at 1 April 2024 and the decision at 1 April 2025.
Philips Pensioenfonds submitted a bridging plan to De Nederlandsche Bank (DNB) for the first time at the beginning of 2024. This bridging plan was approved in February 2024. With the approval of the bridging plan, Philips Pensioenfonds had the opportunity to apply the more lenient indexation rules in 2024 and 2025. These more lenient indexation rules were used for the increase in pensions on 1 April 2024 and 1 April 2025. A pension fund must update the bridging plan annually in order to continue to use the more lenient indexation rules. Philips Pensioenfonds submitted the updated bridging plan 2025 (hereinafter referred to as the bridging plan 2025) to DNB for approval in June 2025. DNB had approved the updated bridging plan, so we can also apply the broader indexation rules to the indexation decision as of 1 April 2026. It is a legal requirement to update the bridging plan again in 2026, even though the indexation as of 1 April 2026 will be the last one under the current pension scheme. The updated 2026 bridging plan was submitted to DNB for approval in March 2026.
The bridging plan will remain in place until we switch to the new pension plan in 2027. However, Philips Pensioenfonds has to update the plan each year. It might also need to adjust its policy if circumstances require.
The rules for indexing pensions are more lenient as long as the Pension Fund submits an updated bridging plan annually (and this is approved by DNB). Under those more lenient rules, pension funds are permitted to index their pensions if their funding ratio is 105% or higher. This means that the financial reserve may not drop below 5% as a result of the indexation. Any assets above that minimum may be used to index the pensions, as long as the pension fund can demonstrate that it will still have enough resources to make a balanced switch to the new pension plan. An important factor here is that the Board of Trustees of Philips Pensioenfonds determines every year what a sensible rate of indexation is, even without these legal requirements. Every year, the Board weighs maximum indexation against the need to protect the buffer, making allowance for a minimum target funding ratio for entitlement conversion of 114%.
Whenever we make a decision, we always consider how it will affect each of our members, individually and as separate groups. Indexing the pensions before the switch means a higher pension right now for our pension beneficiaries. Members who are not drawing their pension yet will also see an increase. However, the more lenient indexation rules in particular benefit members aged 64 and up.
Increasing the pensions costs money, which Philips Pensioenfonds takes from the financial buffer. The Board wants all our members to get off to a strong start when we switch to the new pension plan in 2027. With this in mind, we also consider what impact our decision will have over the entire period until then. Indexing the pensions now means that we will have less money to share among our members when we switch to the new system. On balance, this is slightly less favourable for active members, and in particular the younger active members, who have accrued less pension than older members. Their indexation is awarded on a smaller amount. It would be fractionally better for them if we awarded slightly less indexation now, which would leave more money for their personal pension savings when we make the switch. Another consideration is that applying the transitional financial assessment framework increases the possibility that we might have to lower our pensions. If we award more indexation than would be possible under the normal indexation rules, the Pension Fund’s buffer is reduced by more than it would under those normal rules. Lowering the pensions would have immediate financial consequences for our pension beneficiaries. However, the finances of Philips Pensioenfonds are strong enough that it is very unlikely that we will need to lower the pensions, even using the transitional financial assessment framework.
The bridging plan explains why Philips Pensioenfonds wants to have the option of applying the more lenient indexation rules, why this is a sensible decision given the pension fund’s finances, and how it will affect our members in the different age categories.
Philips Pensioenfonds’s bridging plan shows that the finances will still be sufficiently healthy when we switch to the new pension plan, even with the more lenient indexation rules.
You can download an abbreviated version of the bridging plan 2026 here. The bridging plan 2026 explains why Philips Pensioenfonds wants to have the option of applying the more lenient indexation rules, why this is a sensible decision given the pension fund’s finances, and how it will affect our members in the different age categories.
By using the temporary government rules (the transition FTK), Philips Pensioenfonds is allowed to grant more lenient indexation up until the start of the new pension scheme. This is particularly beneficial for older active members and for pension recipients. At the same time, granting more indexation now means that the Fund retains fewer financial resources to increase pensions later on. In addition, while the rules for increasing pensions have become more flexible, the rules for reducing pensions have become somewhat stricter if the financial situation deteriorates. Because younger participants are mainly affected by long‑term outcomes, granting more indexation now is—viewed over the long term—less favourable for them.
Nevertheless, the financial position of Philips Pensioenfonds is currently strong. The likelihood that the Fund will have to reduce pensions is therefore small, even when applying the more flexible indexation rules.
How the combined effects of higher indexation and stricter reduction rules ultimately play out is uncertain. Philips Pensioenfonds has analysed the potential generational effects in accordance with the legally prescribed methodology. This analysis shows that the differences between applying the current indexation rules and the more flexible rules—expressed in net benefit—are limited for all participants (ranging from +1.2% to –0.3%). This is because the more flexible indexation rules only have an effect in 2026 (until the transition to the new pension scheme), which is a short period. Moreover, the effects remain limited because the Board annually assesses what level of indexation is responsible, taking into account the objective of protecting the financial buffer (in addition to the aim of granting the highest possible indexation).
The Board has therefore concluded that using the more flexible indexation rules is balanced, also because the annual indexation decision explicitly takes differences between participant groups into account. The Accountability Body has likewise issued a positive opinion on this conclusion in the bridging plan.
The more lenient indexations are favourable for active members over the age of 64: they gain up to 0.3% by benefiting from the extra indexation in the short term. The younger group of active members suffer a minor loss of up to 0.3%, as they would benefit more from having a greater financial buffer and more indexation in the future, when they have accrued more pension.
To see a graph with the effects for every age category, see the bridging plan that is published on our website.
The more lenient indexations have a favourable effect for all the pension beneficiaries, who see an immediate financial effect of the extra indexation. Maximum indexation in the short term means a gain for them of up to 1.2%.
To see a graph with the effects for every age category, see the bridging plan that is published on our website.
For non-contributory policyholders, it likewise applies that participants older than 64 will see a maximum increase of 0.3%. For younger policyholders, there is a small disadvantage of up to 0.3%, just as for active contributors.
To see a graph with the effects for every age category, see the bridging plan that is published on our website.
Questions Indexation decision
Want to read more?
The ambition of Philips Pensioenfonds is to raise pensions that are being drawn and non-contributory pensions annually by the same rate as price inflation. This is expressed in the movements in the derived consumer price index, as established by Statistics Netherlands (CBS).
The ambition of Philips Pensioenfonds is to raise the pensions accrued by active members by the same rate as the year’s wage inflation, i.e. the movements in the collective salary scale adjustments at Philips (including for active members who work for Signify or Versuni).
According to the existing legal rules for indexation, a maximum partial increase of 52% of the ambition was possible in 2026. This amounts to an increase of approximately 1.1% for retired members and non-contributory policyholders and approximately 1.6% for active members. However, Philips Pensioenfonds has used the more lenient indexation rules that are available through the application of the transition FTK. This allows earlier and more indexation to be provided than under the existing statutory indexation rules. On this basis, the Board has been able to decide to fully increase all pensions.
Compensatory indexation is governed by the existing indexation rules. It is possible only if the policy funding ratio passes a threshold defined by law. For Philips Pensioenfonds, that threshold was 138.7% at the end of December 2025. Since the policy funding ratio was far lower, at 125.2%, we are not legally allowed to grant compensatory indexation at this time.
How was the price inflation of 2.1% determined?
The price inflation is based on the development of the derived consumer price index over the period from January 2025 through January 2026. Based on this, the price inflation we use as the ambition within our indexation policy comes out at 2.1%. This percentage may differ from figures used by other pension funds if they apply a different measurement period (for example, September‑to‑September) or if their figures are based on the regular, non‑derived consumer price index.
No full indexation has been granted over the total period since 2011. The ambition of the Board of Trustees is to grant full indexation at the same rate as price inflation (for retired members) and at the same rate as wage inflation (for active members). A review of recent years shows that up to and including 2026 the total indexation that has been forgone compared with that ambition is:
- 16.1% for retired members and non-contributory policyholders
- 18.7% for current employees of Philips and Signify accruing pension rights under the flex pension (collective labour agreement and senior directors) plan
- 20.7% for current employees of Philips and Signify accruing pension rights under the flex pension (executives) plan.
Whenever we make a decision, we always consider how it will affect each of our members, individually and as separate groups. Indexing the pensions before the switch means a higher pension right now for our pension beneficiaries. Members who are not drawing their pension yet will also see an increase. However, the more lenient indexation rules in particular benefit members aged 64 and up.
Increasing the pensions costs money, which Philips Pensioenfonds takes from the financial buffer. The Board wants all our members to get off to a strong start when we switch to the new pension plan in 2027. With this in mind, we also consider what impact our decision will have over the entire period until then. Indexing the pensions now means that we will have less money to share among our members when we switch to the new system. On balance, this is slightly less favourable for active members, and in particular the younger active members, who have accrued less pension than older members. Their indexation is awarded on a smaller amount. It would be fractionally better for them if we awarded slightly less indexation now, which would leave more money for their personal pension savings when we make the switch. Another consideration is that applying the transitional financial assessment framework increases the possibility that we might have to lower our pensions. If we award more indexation than would be possible under the normal indexation rules, the Pension Fund’s buffer is reduced by more than it would under those normal rules. Lowering the pensions would have immediate financial consequences for our pension beneficiaries. However, the finances of Philips Pensioenfonds are strong enough that it is very unlikely that we will need to lower the pensions, even using the transitional financial assessment framework.
If Philips Pensioenfonds raises its pensions, this is done in the current pension scheme on 1 April of each year. The reason why Philips Pensioenfonds uses this date of 1 April is that this corresponds to the employment regulations that are in place at Philips. For example, pay rises take effect on 1 April. The regular indexation is timed for 1 April to match this.
The increase for pension beneficiaries and non-contributory policyholders is based on the derived price index rate from January to January, which is finalised in early March. The increase for active members is based on the collective salary scale adjustments at Philips during the period from 2 April of the previous year to 1 April of the current year. Every year in March, we announce by what rate the pensions will go up on 1 April, and you receive a personalised letter from us explaining our indexation decision.
What remains of the buffer after forming legal reserves, paying compensation, and forming the solidarity reserve will be used for an extra payment into the personal pension pots. This is carried out in a balanced way. We will divide these payments among the members’ personal pension savings in line with our ambition under the existing pension scheme: ‘a pension for all our members that is based on full pension accrual and full indexation’. This takes into account indexation missed in the past as well as future indexation. A portion of the value of missed indexation and an equal portion of the value of future indexation will be added to your pension pot. The amount of this extra payment depends on your personal situation, and is primarily determined by the level of your accrued pension, your age, and whether you are an active member, non-contributory policyholder, or retired member. Read more in our onepager.
The increase as of 1 April 2026 is the final indexation under the current pension scheme. The next adjustment to your pension will take place when we transition to the NexT Pension, the new pension scheme, on 1 January 2027. For more information, please also see the question “When will I receive the new (increased) pension amount in the NexT Pension?”
In January 2027, you will still receive the same gross pension amount as in December 2026. This is because the transition of pensions (“invaren”) based on the funding ratio as of 31 December 2026 will not yet be completed. In February 2027, this process will be finalized. In February, you will receive your new pension amount—which includes the increase resulting from the distribution of the buffer—as well as a retroactive payment of the increase for January. From March 2027 onward, you will receive the new pension amount each month.
We will illustrate this with an example calculation (all amounts are gross). Suppose:
- your monthly pension is currently €1,000
- during the transition, you receive a 10% increase
- your new monthly pension amount will then be €1,100
You will then receive:
- in January 2027: €1,000
- in February 2027: €1,200 (€1,100 for February plus a retroactive payment of €100 for January)
- from March 2027 onward: €1,100 per month
Related information
You might also be interested in the following information.
Read more?
In our magazine Generations, two board members told in December 2022 how the Board determines how much indexation is justified.
Go to magazine Generaties
News item
Earlier, we published a news item about the annual consideration that the Board makes about how much indexation is justified.
Go to news item