Dutch Pension Funds ABP and PME call for end to fossil fuel subsidies

Two prominent Dutch pension funds, ABP and PME, have joined more than a hundred organizations in signing a letter urging the Dutch government to cease providing tax breaks to the fossil fuel industry. The initiative, led by Fossil Free Netherlands, includes signatories such as civil service scheme ABP, metals and technology industry fund PME, trade union FNV, and third-pillar pension provider Bright Pensioen. 

Two prominent Dutch pension funds, ABP and PME, have joined more than a hundred organizations in signing a letter urging the Dutch government to cease providing tax breaks to the fossil fuel industry. The initiative, led by Fossil Free Netherlands, includes signatories such as civil service scheme ABP, metals and technology industry fund PME, trade union FNV, and third-pillar pension provider Bright Pensioen. 

According to figures from the Dutch government, fossil fuel subsidies in the country amounted to approximately €4.5 billion in 2020. These subsidies include tax rebates for major energy consumers, such as Tata Steel, and exemptions from excise taxes on diesel and fuel oil for the inland shipping sector. 

While Dutch climate minister Rob Jetten has previously committed to “phasing out” fossil fuel subsidies, he has yet to present a concrete plan for implementation. 

The signatories of the letter believe that eliminating fossil fuel subsidies in the Netherlands could lead to a 7.5% reduction in CO2 emissions, provided the saved funds are reinvested in the energy transition. 

ABP, which recently decided to divest from fossil fuels, stated that supporting the end of fossil fuel subsidies aligns with its commitment to limit global warming to 1.5°C. PME Chair Eric Uijen emphasized that these subsidies distort the market, hinder innovation, and exacerbate climate change, ultimately impacting long-term returns and harming members’ interests. 

However, Bart Smals, member of parliament and pension spokesman for the largest coalition party VVD, criticized ABP and PME’s “activist stance,” suggesting that it comes at the expense of returns. Smals questioned the necessity of mandatory participation in pension funds if they continue in this direction, stating that there should be room for members who prioritize returns over activism. 

The call to end fossil fuel subsidies from influential pension funds highlights growing pressure on the Dutch government to address climate change by phasing out financial support to the fossil fuel industry. 

Read more: https://www.ipe.com/news/abp-and-pme-demand-end-to-fossil-fuel-subsidies/10066806.article