“Although the economic recovery appears to be taking hold, the financial markets are still volatile,” he said. “This underlines the importance of a new and future-proof pension scheme, which should moderate wide fluctuations.” Almost all asset classes contributed to the pension fund’s return, which the director described as “satisfactory”. PFZW’s liquid equity portfolio returned 21.3%, while its private equity holdings returned 19.4% “due to revaluations”.The scheme added that structured credit delivered 20.4% on lower credit spreads. The scheme’s 11% property allocation returned 7.7%.The healthcare fund further reported results on infrastructure, hedge funds and catastrophy insurance of 5.4%, 5.6% and 9.6%, respectively. In contrast, the pension fund lost 10% on its fixed income securities, mainly as a result of rising interest rates. Its 22% allocation to government bonds, interest and inflation swaps lost 13.8%.However, Jan-Willem van Oostveen, the scheme’s investment manager, pointed out that this figure included the effect of the rising interest rates on the 40% hedge of the pension fund’s liabilities.Within this context, the healthcare scheme concluded that a sustained increase of long-term interest rates may drag on total returns in future. Yet Borgdorff explained to IPE that the pension fund would still reap the benefits of rising interest rates for the non-hedged part of its liabilities, and stressed that the funding ratio was the scheme’s most important criterion. PFZW attributed the 5.9% loss on its investments in high yield and emerging market debt to the depreciation of local currencies against the euro. It also said the return on commodities was close to 0%, “as the price increase of Brent oil and industrial metals was largely offset by price drops of West Texas Intermediate oil and agricultural products”.The scheme added that corporate bonds benefited from a decrease in credit spread, returning 1.1% in 2013.During the presentation, Borgdorff lamented the consecutive delays at the Ministry of Social Affairs in drawing up proposals for a new financial assessment framework (FTK).He said he was worried the new introduction date of 1 January 2015 could not be met either, and added that PFZW still strongly supported a new pensions contract under real terms rather than nominal terms.The scheme’s director also called for a broad debate about the review of the pensions system, involving all stakeholders, and including all controversial issues, instead of solving one problem at the time. The healthcare scheme Zorg en Welzijn (PFZW) saw its assets increase to more than €137bn on the back of an annual return of 3.7%, supported by a fourth-quarter result of 1.9%.Last year, the pension fund’s coverage ratio increased by 8 percentage points to almost 110%, enabling the scheme to grant a partial indexation of 0.94%, according to Peter Borgdorff, the scheme’s director, during the presentation of the preliminary figures. He indicated that PFZW would keep the yearly pensions accrual at 1.95% for its participants this year, and that it would also keep the contribution level at 24.4% of the salary.However, Borgdorff said he remained cautious.