10.8.100 Netherlands Glossary

Introduction

This section contains a list of terms used in and applicable to the Agreement with the Netherlands.

Australian Bereavement Allowance

Under this Agreement, bereavement allowance can be paid to the partner of a deceased pensioner if the partner is qualified under SSAct section 315.

Australian Disability Support Pension

The Agreement limits DSP to those people who are severely disabled.

Australian Wife Pension

After 30 June 1995, WP cannot be granted, even under an agreement. An autonomous wife pensioner can transfer to an agreement WP (when an agreement covers this concurrent entitlement) as this is not classified as a 'new grant' of WP. WPs granted under the Agreement before 1 July 1995 continue to be paid outside Australia. WP can only be paid under the Agreement to a woman who has been an Australian resident at some time.

Benefit

For Australia, the term 'benefit' means Age and WP for the partner of an age pensioner, and DSP for the severely disabled and the partner of a DSP who is severely disabled. It includes any additional amount or increase that is payable to or in respect of a person who qualifies for that additional amount or increase. RA, PhA, TAL and RAA are also included for people in Australia but are subject to the portability restrictions of the SSAct. For 'portability' purposes, benefit also includes Australian DOP. For the calculation of Australian benefits, benefit also includes pensions payable to widowed persons.

For the Netherlands, benefit means the general old-age pension (AOW), the general old-age pension spouse supplement (AOW toeslag), payments made under the:

  • General Surviving Relatives Act (ANW),
  • General Child Benefits Act (AKW),
  • General Act on Exceptional Medical Expenses (AWBZ),
  • Self-employed Person's Disablement Act (WAZ),
  • Sickness Benefits Act (ZW),
  • Disablement Benefits Act (WAO),
  • Unemployment Benefits Act (WW),
  • National Assistance Act (ABW), and
  • Supplementary Benefits Act (TW).
Legislation

Legislation means the Acts that make up the social security law that applies to Age, DSP, pensions payable to widows and CP. It also applies to the Superannuation Guarantee (Administration) Act 1992, the Superannuation Guarantee Charge Act 1992 and the Superannuation (Administration) Regulations.

Netherlands/The Netherlands

The territory of the Kingdom of the Netherlands in Europe.

Netherlands' Disablement Benefits Act - WAO/Disablement Benefits Act - WAO/Disablement Benefits for Employees

This Act entitles disabled employees under the age of 65 to a benefit if they are still at least 15% unfit for employment after 52 weeks of disability. However, claims under the Agreement require the applicant to be eligible for Australian DSP as severely disabled. The rate of benefit depends on the degree of disablement, the employee's last-earned wage and the employee's age on the date the benefit commences. Benefits can be claims for a period of 5 years, application for continuation of benefit must be made at least 3 months before the termination of the 5 year period. Toeslag may be payable.

Netherlands' General Act on Exceptional Medical Expenses (Compensation) - AWBZ/General Act on Exceptional Medical Expenses (Compensation) - AWBZ

This Act insures medical risks which are not covered by compulsory or private health insurance. This includes hospital care and rehabilitation institutions after the 366th day of hospitalisation plus various kinds of psychiatric nursing, rehabilitation and outpatient care, long term nursing home nursing and services in the field of mental and private health care.

Netherlands' General Child Benefits Act - AKW/General Child Benefits Act - AKW

Benefits under this Act offer financial benefit to assist in the cost of providing for children to those who care for or bring up children under the age of 18. The amount of the child benefit depends on the age of the child and the size of the family.

Netherlands' General Old-Age Pension - AOW/General Old-Age Pension Act - AOW/General Old-Age Pension

A person (male and female) must be 65 years of age to qualify for AOW. A person qualifies on their 65th birthday provided they have been insured at any time. There is no minimum qualifying period.

AOW pensions are based on an insurance period of 50 years (from 15 to 65) for maximum pension. Insurance periods are periods of residence in the Netherlands or voluntary contributions paid while residing outside the Netherlands. The maximum rate of pension is linked to the Netherlands' net minimum wage. There is no relationship between the amount of contributions and the amount of pension received.

The maximum rate of AOW pension for:

  • a couple, both pensioners, is 70% of the net minimum wage each,
  • a couple, one a pensioner and one a non-pensioner partner under 65 years of age, is 70% of the net minimum wage (in addition the pensioner may get partner supplementary allowance - AOW toeslag - to a maximum of 30% of the net minimum wage, based on the partner's insurance periods),
  • a single person is 70% of the net minimum wage, and
  • a single parent is 90% of the net minimum wage.

Pensions are paid monthly with an additional holiday allowance accruing monthly and paid annually with the May payment.

The accrued holiday allowance is included in the monthly pension assessed by Centrelink.

Pensions are indexed in line with the CPI increase on 1 January and 1 July of each year.

Netherlands' General Old-Age Pension - AOW transitional arrangements

When AOW started on 1 January 1957 it was recognised that it would be impossible for anyone already over 15 years to achieve maximum contributions of 50 years. Transitional arrangements allow these people to qualify for a full pension.

Under transitional arrangements, insured people are deemed to have been insured from their 15th birthday until 1 January 1957 provided they:

  • are Dutch Nationals,
  • are resident in the Netherlands, and
  • have resided in the Netherlands for 6 years after reaching the age of 59.

These deemed periods are called 'fictitious insurance periods'. The Agreement modifies the arrangements and allows Australian citizenship and Australian residence to be used as shown in the following example:

Example: A woman born on 2 April 1920 in the Netherlands emigrated to Australia on 2 May 1960. She was insured for the period 1 January 1957 to 2 May 1960, a period of 3 years and 5 months which is rounded up to 4 years. On reaching age 65 in 1985 she was entitled to an AOW pension of 8% (4 × 2%) of the maximum rate.

After the Agreement started on 1 April 1992, her residence in the Netherlands from her 15th birthday (1935) to 1 January 1957 (22 years) are now counted giving her an additional 44% (22 × 2%) pension. Her total AOW pension would then be 52% (8%+44%) of the maximum rate.

All residents of the Netherlands between age 15 and age 65 are liable to pay 14.30% of their income as contributions towards their AOW pension. There is a ceiling on the maximum contribution.

Netherlands' General Surviving Relatives Act - ANW/General Surviving Relatives Act - ANW/General Surviving Relatives Benefits

This Act came into effect on 1 July 1996. It provides entitlements to benefits for widows, widowers and dependent children who have lost one or both parents. The deceased spouse, partner or parent must have been insured under ANW on the date of his or her death.

ANW survivors' benefit is payable to the surviving relative if the relative:

  • has an unmarried child under the age of 18 who does not belong to another's household, or
  • in incapacitated for work for at least 45%, or
  • was born before 1 January 1950.

People taking care of a child that has lost its parents are entitled to ANW dependent child allowance. Children who have lost both parents are entitled to orphan's benefit.

Benefits are paid at statutory basic rates dependent upon the benefits being claimed. ANW survivors' benefit is also means tested.

Netherlands' National Assistance (Algemene Bijstandswet) - ABW/Algemene Bijstandswet

This is a means tested benefit for those in need. It is payable to a person who is not entitled to a general old-age pension (AOW) or whose AOW entitlement is insufficient to provide for their essential needs.

It is paid to Dutch Nationals and 'tolerated foreigners' living legally in the Netherlands who do not have enough income. It is not portable from the Netherlands. Australian pensioners living in the Netherlands can receive this benefit.

Payments are monthly at a standard rate determined by the person's age, marital status and living and domestic circumstances.

Netherlands' Period of Insurance/Netherlands' Periods of Insurance

These are periods during which contributions were paid or were deemed to be paid under Netherlands' law (e.g. a period receiving Netherlands' sickness benefit would be deemed to be a 'period of insurance').

Netherlands' Self-employed Person's Disablement Benefits Act - WAZ/Self-employed Person's Disablement Benefits/Self-employed Person's Disablement Benefits Act - WAZ

This Act insures against the loss of income due to long term disablement. It covers self-employed people and those who have been handicapped from an early age. To be eligible a person must:

  • be between 18 and 65 years of age,
  • have received income from or in connection with work in the year before becoming disabled (does not apply to people who are handicapped from an early age), and
  • have been at least 25% incapacitated for work for at least 52 weeks. However, claims under the Agreement require the applicant to be eligible for Australian DSP as a severely disabled person.

Benefits under WAZ are granted for a period of up to 5 years and the rate of benefits depends on the degree of incapacity for work and is based on a statutory amount called the basic amount (approximately equal to the gross minimum wage per months). If the WAZ benefit plus any other family income is less than the minimum guaranteed income, a supplementary benefit may be paid under the Supplementary Benefits Act (TW). Toeslag may be payable.

Netherlands' Sickness Benefits Act - ZW/Sickness Benefits Act - ZW/Sickness Benefits

Sickness benefits are paid under this Act as a safety net payment for employees who do not or no longer have an employer due to their sickness. It is paid for the first 12 months of the sickness. After 52 weeks of sickness the employee falls under the Disablement Benefits Act - WAO. The rate of sickness benefit is usually 70% of the maximum daily pay of the employee.

Netherlands' Spouse Supplementary Allowance - AOW Toeslag/Old-age Spouse Supplement/Toeslag

A person getting AOW pension who has a partner under 65 years of age can get AOW toeslag. The allowance is paid to the AOW pensioner. When the partner reaches 65 years of age, the supplement is withdrawn and the partner is paid an AOW pension.

People granted AOW pension before 1 April 1988 with a partner under 65 were entitled to a pension based on a maximum of 50% of the net minimum wage plus AOW toeslag based on a maximum rate of 50% of the net minimum wage. Both payments were means test free, but an income test on the partner's income from, or in connection with, employment has been applied to AOW toeslag from 1 April 1991 where the partner was under 60 years of age.

People granted AOW pension from 1 April 1988 to 31 January 1994 with a partner under 65 were entitled to a pension based on a maximum rate of 70% of the net minimum wage plus AOW toeslag based on a maximum rate of 30% of the net minimum wage.

People granted AOW pension from 1 February 1994 with a partner under 65 are entitled to a pension based on a maximum of 50% of the net minimum wage plus AOW toeslag based on a maximum rate of 50% of the net minimum wage. An income test on the partner's income, from or in connection with employment, applies in respect of toeslag.

Under Article 20(1) of the Agreement, if an AOW pensioner resides in Australia and is entitled to receive AOW toeslag in respect of a partner, any Australian benefit the partner receives is to be disregarded under the AOW toeslag income test. Article 20(2) and 20(3) allows this concession to continue under prescribed circumstances if the person resides in a third country.

Netherlands' Supplementary Benefits Act - TW/Supplementary Benefits Act - TW

This Act provides assistance to unemployed or disabled persons receiving benefits under the WW, WAO, WAZ and ZW if their income falls below the minimum guaranteed income level and the total income of the beneficiary and his or her partner.

Netherlands' Unemployment Benefits Act - WW/Unemployment Benefits, Unemployment Benefits Act - WW

This Act ensures employees against the consequences of unemployment. Entitlement to unemployment benefits is dependent upon a person having been employed for a minimum period immediately before becoming unemployed (this requirement varies for different categories of employment). The rate of benefit is set at 70% of the minimum wage and duration of benefit depends on the employee's employment record.

Period of Australian Working Life Residence

Means a period of Australian working life residence as defined in the SS(IntAgree)Act, but excludes a period deemed to be a period of Australian residence in Article 10 of the Agreement.

Widowed Person

The Agreement restricts the term 'widowed person' to de jure widows and widowers, that is, people whose partner has died. It does not apply to people who have been widowed and either remarry or enter into a de facto relationship. This restriction only applies to Australia.

Last reviewed: 9 November 2015