– The only thing I’ve heard about pensions is mum and dad who have recently said that they are going to start saving. But I haven’t really thought about it for a second, says Eirik Arentz (18) to news. But he and the five mates from Arendal upper secondary school have realized that there will be less money and pensions left for future generations. – For us it is stupid, of course. We would like to have as much as the generation before us. But we have to be a bit realistic. The older generation has had it very well. They have been lucky with oil, and it is on its way out as we get older, says Anton W. Fladmark (18). NON-TOPIC: Pension is not what is most often discussed when friends Anton W. Fladmark (18), Magnus R. Jørgensen (18) and Eirik Arentz (18) from Arendal meet. Photo: Mats Rønning For now, recent figures from the government show that almost four out of ten Norwegians in 2060 will have an old-age pension from the national insurance which is lower than the current minimum level for single people. The assumption in the government’s own estimates is that the current way of calculating pensions will continue. One in five will in 2060 want an old-age pension that is lower than the minimum level for married people. – The figures show that we are heading for a historic pension crash, where four out of ten in my generation will actually be minimum pensioners or worse in 2060. I don’t think people have realized how dramatic those figures really are, says Rødt’s Mimir Kristjansson to news . – The minimum pension applies to those living today, but for my generation there is no minimum pension. There is something called a guaranteed pension, and the only guarantee in it is that you can become very poor, he fears. The old earnings model still applies in full to those born in 1953 or earlier and partially to those born between 1953 and 1963. PENSION BOMB: Rødt’s Mimir Kristjansson asks the government to take action to ensure that the lowest benefits are better for future pensioners. Photo: Kristian Skårdalsmo That’s why he reacts The simple, but also complicated question Rødt posed to Labor and Inclusion Minister Marte Mjøs Persen (Ap) this summer was: How many will receive a pension below the current minimum level in the future? Due to the pension reform, the minimum pension, as we know it today, will soon be replaced by a so-called guaranteed pension. The guarantee pension depends on income and is thus not a fixed kroner amount like today’s minimum pension. Many will, as the recent figures show, come out far worse off than today – if nothing is done about how the lowest benefits are regulated from year to year. The pension committee was chaired by Kristin Skogen Lund and presented its report last summer. Among other things, the committee put forward proposals for how regulation of the minimum benefits can be changed and improved, a form of “wage growth” that will mean that far fewer people become minimum pensioners or end up even worse off: – In addition, the committee’s proposal for increased age limits, as well as the majority’s proposal for new accruals for old-age pensions for the disabled. With these assumptions, the proportion who in 2060 have an old-age pension lower than the minimum level for single and married people in 2023 is estimated to be 26 and 6 per cent respectively, writes the ministry. – Shocked But Kristjansson fears the reform will end with a sharp deterioration in people’s pensions. – What did you think when you saw the answer from the Minister of Labour? – I was shocked, because I have thought of the minimum pension today as a level that is almost impossible to live on, says Kristjansson. – Is the answer to start with private pension savings? – The answer is to increase the pension back to the level they were at. – Surely a demand to increase benefits will soon collide with the line of work? – There are many people who can stay at work longer, including me who is a politician and can probably work until I am 80. But in the vast majority of jobs it is not possible to work until you are 70 or 80, as if you work at the floor in the healthcare system or in industry. Rødttoppen now hopes “The Labor Party remembers that they are the Labor Party, takes care of the pensioners and does not think of the pension reform as a sacred cool”. Laws seized Employment and Inclusion Minister Marte Mjøs Persen (Ap) will come this autumn with a new report to the Storting on pensions. The work is, among other things, about how to regulate the minimum level better than today, she emphasizes. – The pension reform was very important. It made our pension system more financially sustainable. Now the time has come for us to make it more socially sustainable, says Mjøs Persen to news. PROMISES: Minister for Employment and Inclusion Marte Mjøs Persen (Ap) will make a parliamentary report on pensions this autumn. Photo: Javad Parsa / NTB But increased minimum benefits are a tough nut to crack for the red-greens. The reason is that such measures quickly involve tens of billions in increased expenses. Mjøs Persen nevertheless makes the following promise: – When we come up with the Storting report on the pension in the autumn, there will be proposals on how the minimum benefits can be regulated in a way that is more in line with the general wage trend than it is today. – Red says the answer is simple: Scrap Høyre and APS pension reform? – I completely disagree with that. The pension reform was very important, because we must also have room in future state budgets to prioritize things other than pensions. – Will be lower Independent pension expert Alexandra Plahte, head of Formue Pensionsrådgivning, says there is little doubt that many future old-age pensioners will receive a pension that is lower than the current minimum pension level. – The estimate of how many there will be obviously depends on a number of factors, such as which calculation assumptions are entered for, among other things, regulation of the pensions, but not least on which of the current rates are compared with, she tells news. EXPERT: Alexandra Plahte in Formue Pension Consulting. Photo: Formue Pensjonsrådgivning Plahte reminds that the minimum pension level has five different rates, while the guaranteed pension only has two. – The guarantee pension is lower than the highest rates for the minimum pension level, she points out, and also explains how many people will receive a much lower pension payout for working than they actually think: – The guarantee pension represents a minimum income for those who do not have their own pension earnings. When you build up your own pension (income pension), 80 percent of the pension accrual goes to reduce the guarantee pension. It is the guarantee pension itself that is reduced, but the effect in practice is that you are “only” left with 20 per cent of what you have earned yourself. Only when you have “topped up” enough for the guarantee pension to go to zero, you get the full effect of your earned pension. The higher the guaranteed pension, the more years you have to work before you get the full effect of the retirement pension you earn with Nav, says the pension expert. Finally, she reminds that a future pension system must also be financially sustainable for the state. – That your own earned pension does not come in addition to the guaranteed pension is in and of itself logical, as you would otherwise get very high pensions and – not least – AS Norge very high pension costs. At the same time, it is a reality that many are left with less pension earnings to work than they probably think.
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Fears huge bang for young people – news Norway – Overview of news from different parts of the country
