GERMANY - Telecommunications firm Deutsche Telekom (DT) has signed an agreement with public sector trade union Vereinte Dienstleistungsgewerkschaft to convert its pension arrangements into an external pension fund.
The new fund will be set up in line with the Riester pension reform, which instructs companies to provide only the framework for an external pension scheme into which employees can contribute. About 120,000 DT employees across Germany are expected to join the fund.
The converted arrangement will be introduced in January 2002 and will include contributions by the government.
DT is currently surveying the fund manager market and aims to make an appointment by mid-December. The investment strategy will also be confirmed by this time once the Government has certified a series of investment products which can offered to German pension funds, said a spokesman for DT.
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