Sweden's ITP white collar workers DB pension system will become a hybrid DB/DC scheme this month, ending four years of negotiation between employers and employee associations.

At the time of going to press, an agreement was being hammered out between the two sides which will see almost 1m employees with annual contributions of Skr10bn ($1.2bn) covered by a new compulsory dual system.

Gertove Andreasson, CEO says: We expect that up to 7.5% of yearly salary, on average around Skr280,000 will now be covered on a DC basis, with anything above this figure remaining DB, although the final details have yet to be agreed before the system can be implemented." And Sweden's 1.1m blue collar workers have begun making contributions totalling Skr 16bn (Skr10bn from 1986/87 and Skr6bn from 1998) to the 14 authority-approved life insurance companies and unit linked insurers selected to manage the new money."

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