Trust and Distrust in Pension Providers in Times of Decline and Reform: Analysis of Survey Data 2004-2021.

Trust in pension providers by participants is essential because pension providers try to fulfill their pension promises in a fundamentally uncertain world. Reforms and crises are therefore the ultimate testing ground for pension trust. In this paper we estimate with repeated cross-sectional survey data how trust and distrust in Dutch pension funds and the government have evolved over the period 2004-2021 and what the impact of financial stability on trust in these two institutions has been. Financial stability of pension funds, measured by their funding ratio, is shown to affect trust positively, but it does not decrease distrust significantly. Based on the estimation results, achieving a situation where the majority of the adult population trusts pension funds is likely to be attained at funding ratios of 115 or higher. Financial stability of government (measured by government debt/GDP ratio) does not affect either trust or distrust levels. Underlying drivers of distrust and trust such as personal characteristics are also notable: self-employed are more prone to distrust pension funds than employees. Women are more than men likely to take a neutral position.