Norwegian Parties Agree to Expand Workplace Pension Plans
(Bloomberg) -- Norway’s ruling three-party coalition agreed with the opposition Progress Party to remove restrictions on private occupational pension plans so they can be extended to young and part-time workers.
The changes would require employers to pay contributions to pension funds to those who work as little as one day a week, workers who earn less than the current basic amount under the national insurance system -- now at 101,351 kroner ($11,883) per year -- and to staff younger than 20. The pensions, which supplement the national old-age pension, would also accrue from the first krone instead of every kroner above a basic amount.
The changes will probably be introduced from 2023 to allow businesses time to deal with the fallout from the pandemic, the parties said in a joint statement on Saturday. To cover the additional cost for companies, the government will look at a corresponding reduction in employers’ tax contributions for a transitional period of three years, or other relief.
The government of Premier Erna Solberg, who leads the Conservative Party, needs the support of Progress to push through initiatives in parliament after she lost her majority a year ago when the anti-immigration party left the coalition. The changes highlight increasing pressure on the Nordic cradle-to-grave welfare model amid concerns about rising inequality and an aging population.
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