Danish government launches long-awaited pension reform – The Post

Danish government launches long-awaited pension reform

A better deal for people with physically-demanding jobs who are unable to last the distance to pension age is on the cards

Minister Troels Lund Poulsen hope the new agreement will prove to be a vote-winner with the electorate (photo: Johannes Jansson)
May 3rd, 2019 11:18 am| by Stephen Gadd

With the announcement yesterday of the government’s new senior pension initiative, a major hurdle in the run-up to the general election has been cleared.

“Today, we’ve made an important agreement that looks after those people who have been worn down through their working life,” said the employment minister, Troels Lund Poulsen.

“They must have the opportunity to retire earlier from the job market.”

The reform package, agreed between the government with the support of Dansk Folkeparti and Radikale Venstre, is a countermeasure to the proposals put forward by Socialdemokratiet’s PM candidate, Mette Frederiksen.

The senior pension
The new initiative provides a senior pension, allowing people who feel physically run down and unable to work the right to retire from the job market six years earlier than normal. It also improves the system that at present allows people to work reduced hours in a flexjob.

READ ALSO: Government open to discussing early pensions for worn-out workers

In addition, a commission will be set up to look at the pension system after 2040, when it is expected that the pension age will have reached 70.

Recognising the fact that there is almost full employment and a shortage of labour, pensioners will also be offered more favourable economic terms if they choose to work whilst drawing their pension.

The government also intends to set aside 100 million kroner annually to combat the effects of wear and tear on workers.

Assessment system
The new senior pension will be based on an assessment system and, in order to qualify for it, you will need to have six years or less to pension age, have worked for 20-25 years, and be judged to be unable to work for more than 15 hours per week.

The amount paid out will coincide with the current one for the førtidspension early retirement scheme at 18,875 kroner per month for single people and 16,044 kroner per month for married people of cohabitees.

However, the details are rather vague about how this will work in practice. For example, a number of occupations such as nurses, doctors, teachers and pedagogues are high-stress ones that take a mental toll rather than a physical one. Will they be eligible and how will the assessments be carried out? That remains to be seen.

If agreed, the new system would come into force on 1 January 2020.