New Danish government shuts down pensions commission
The pensions commission set up last year in Denmark to take a holistic look at retirement provision in the Nordic country is now to be shut down, the incoming minority centre-right government has announced.
The new government was formed less than a fortnight ago following the June general election as a minority government consisting only of the centre-right Venstre party.
Led by new prime minister Lars Løkke Rasmussen, the government takes over from the Social-Democrat coalition government under outgoing prime minister Helle Thorning-Schmidt, which has led the country since October 2011.
Løkke Rasmussen’s government has set out plans for a pension reform in the spring of 2016 as part of the overall programme it unveiled a week ago.
The main aim of the reform is to reduce the size of the group of people in Denmark who have no retirement savings of their own.
Karsten Lauritzen, the incoming minister for taxation, said: “I have great respect for the commission members’ professionalism.
“But the fact is the commission was established by the previous government, and we now have a new government with other objectives and a different timescale for its work.”
The pensions commission was launched in May 2014 to find solutions for complex rules and high taxation of pensions, with the aim of making the system more transparent and attractive to savers.
Lauritzen said he hoped the commission’s members would understand the decision to close it, and thanked them for their efforts.
While under the original plan the pensions commission had been working towards presenting its recommendations and final report in the autumn of 2016, the new government wanted the commission to put together a report describing pension conditions among current and future pensioners.
The ministry for taxation said it would not have required the commission to contribute any extra analysis or recommendations, and that the new task would have represented a big change in the organisation’s working conditions and tasks.
After a discussion between Lauritzen and the commission’s chairman Torben Andersen, the ministry said the two men decided it was best to put an end the commission’s work.
Andersen said the commission’s members fully recognised it was the government that set the framework for its future work.
“It is our opinion the work that now needs doing with the written report can easily be done by the relevant ministries,” he said.
“Now the commission no longer has the task of producing a proposal and looking at the pensions sector in its entirety, ending the commission’s work is a natural consequence.”
Industry association Forsikring & Pension (F&P) said it was surprised by the closure of the commission.
Carsten Andersen, deputy director at F&P, said the association still thought the statements on pensions contained in the new government’s programme were positive.
“We support the view it should pay to save for your own pension,” he said.
“For this reason, it is surprising the government obviously has not prioritised analysing the problems of the interplay between public benefits and private pensions.”
It is these problems that present the greatest challenges for a large group within the labour market, Carsten Andersen said.
“For many, it cannot really pay off to save for a pension in the last few years before retirement because their own savings are offset against public benefits,” he said.
He added that the association had been looking forward to the pension commission’s proposal on how these problems could be solved.