WILLEMSTAD – The financial position of the General Pension Fund of Curaçao (APC) strengthened sufficiently in 2025 to allow the fund to compensate pension participants for part of the indexation they missed in previous years.
APC ended 2025 with a funding ratio of 115.6 percent, placing it just above an important threshold under the pension fund's indexation policy.
The improved financial position has allowed the APC board to restore 0.51 percent of previously missed indexation, effective retroactively from January 1, 2026.
The funding ratio is one of the most important indicators of a pension fund's financial health. It compares the fund's available assets with the amount it needs to meet its pension obligations now and in the future.
APC's policy permits the restoration of previously missed indexation once the funding ratio rises above 115 percent. However, the pension fund must also remain above the 115 percent threshold after granting the compensation.
With the ratio reaching 115.6 percent at the end of last year, the board determined that there was sufficient financial room to restore 0.51 percent while remaining within the fund's rules.
The decision is significant because APC has accumulated missed indexation from previous years when its financial position did not allow pensions to be fully adjusted.
Instead of permanently eliminating those unpaid adjustments, APC records them as missed indexation. This means they can potentially be granted later if the fund's financial condition improves sufficiently.
The 0.51 percent adjustment therefore represents compensation for the past rather than regular indexation for 2026.
APC previously determined that there would be no regular pension indexation as of January 1, 2026, because government employee salaries were not indexed at the beginning of the year. The fund's regular pension adjustment is linked to those salary developments.
The newly announced increase will nevertheless provide an immediate financial benefit for pensioners.
Retired participants will receive a 0.51 percent increase retroactive to January 1. APC will process the adjustment in November, when pensioners will also receive the accumulated difference for the preceding months of 2026.
The cost-of-living supplement will increase by the same percentage where applicable. Pension rights accumulated by active and paid-up participants as of January 1 will also be adjusted by 0.51 percent.
However, APC remains only slightly above the 115 percent threshold required for restoring missed indexation.
The pension fund therefore emphasized that the remaining missed indexation will stay on its books and that any additional compensation will depend on future financial performance.
APC said it will continue balancing the possibility of increasing pensions against the need to safeguard the long-term financial security of the pension system.