This article assesses the impact of a dramatic reform of the Dutch pension system on the mental health of workers nearing retirement age. The reform means that public sector workers born on 1 January 1950 or later face a substantial reduction in their pension rights while, for workers born before 1950 nothing changes. We employ a unique-matched survey and administrative dataset comprising male public sector workers born in 1949 and 1950 and find a strong deterioration in mental health for workers affected by the reform. These effects are stronger for married workers whose partner has no pension income. © 2011 The Author(s). The Economic Journal © 2011 Royal Economic Society.