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Home | Finance | Personal Finance The Swedish pension reform of nineteen thirteen introduced a public pension system. It was not the first pension system in Sweden, which was introduced as early as in the sixteen fifties for some government employees. During the latter half of the nineteenth century, larger companies and counties started establishing pension systems for their officials. The public pension system also allowed others to take part of a pension, albeit very small in size. The presence of pension systems within many different working groups can be seen as one of the many factors behind the introduction of the public pension system. A more direct influence could have been discerned from the choice of retirement age for the public pension system – sixty seven years of age. That was the pension age for governmental, non-operational employees. That is for men, the pension age for women was sixty years of age. The introduction of the public pension system resulted in a supplement for those who already had a contractual pension, avtalspension, through their employers. However, together with the pension reform of nineteen forty eight, which resulted in an obvious increase of public pensions, a gross-coordination was also introduced. State-wise this meant that the level of the total pension was decided by the pension according to the governmental agreement. An increase of the public pension in such a system does not result in the level of pension getting paid out getting higher, but rather that the allocation between the public pension and the contractual pension, avtalspension, is changing. This can be seen as a clear example of that it is the total level of pension that is intrinsic, and not the pension’s allocation between different systems. Level changes in one pension system result in direct counteracting changes in another system, but the total level never changes. The public pension gave pensions a common level, but through contracts for larger groups in the job market, the governmentally employed, people employed by the county and the private sector, this level was added to. The people employed under a collective wage agreement in the private sectors were more often than not missing complementary retirement pension insurance, even though there were some local pension systems with very low amounts in general. This was perceived as an injustice, and after a long time of investigation and political bickering, the ATP system was introduced. The ATP is an income related supplemental pension. The presence of contractual pensions, avtalspension, in certain areas and not in others can be seen as an important factor behind the introduction of the ATP system. The ATP system in turn resulted in changes to the existing pension systems, both to the governmental and county sectors as well as to the private sector with the non-manual workers. The local pension systems for people in the private sector employed under a collective wage agreement, which were rather one-sided when it came to the employers’ earnest, were s a rule terminated. Article Source: http://www.articlewheel.com
This is the third of Robb's articles about the Swedish pension system and the history of it. For further reading (in Swedish), refer to PP Pension and their information about "avtalspension" and pensionssparande
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