Second-generation people with foreign background can claim higher pensions than first generation

By the end of 2005, the pension build-up of second-generation people with a foreign background was considerably higher than for the first generation. Yet, the average pension claim of the second generation is still trailing relative to pensions built up by native Dutch. Antilleans and second-generation people with a western foreign background in the 35-40 age bracket have almost attained the level of their native Dutch contemporaries.

Gap between first and second generation

The problem of lower pension claims of people with a foreign background in the Netherlands is essentially a problem between the first and second generation. The pension gap of the first generation is due to the fact that these newcomers came to the Netherlands at a later age and as a result were unable to build up full labour-related and old age pensions. But this only partly explains the gap. Other reasons are higher wages and the fact that people belonging to the second generation are better educated.

Only first generation lags behind

First generation people with a foreign background have lower pension claims than native Dutch. In general, people with a non-western background can claim only half the amount received by native Dutch. For several age categories, the situation is even worse, as they can claim only one third. On the other hand, the upward trend for second generation people with a foreign background is more or less the same as for the various age groups in the native Dutch population.

Pensions built up in pension funds at the end of 2005*

Second-generation Turks and Moroccans aged between 35 and 40 are involved in a major catch-up operation. Their pension claims are more than twice as high as the amount their parents could claim when they were of the same age. The pension claim of second-generation people with a western background and Antilleans is on average substantially higher than for newcomers of the same ethnic origin. For second-generation Antilleans aged between 35 and 40, the pension claim is almost equal to that of native Dutch, i.e. 1,900 euro.

Amount built up in pension funds by 35 to 40-year-olds at the end of 2005*

Igor Džambo