Major Swedish pension providers including Folksam and Länsförsäkringar are supporting a proposal by Insurance Sweden for the government to encourage private pension saving by partially matching contributions.
The providers proposed that the government match individuals’ payments up to 20% of their contributions.
Eva Erlandsson, senior economist at industry group Insurance Sweden, said: “The insurance industry proposes that the state introduce incentives for private pension savings through matching in order to give more people a concrete opportunity to be able to save for their pension.”
The lobby group said Sweden was currently one of the few EU and OECD countries that did not support private pension savings in this way.
The proposal was aimed particularly at low and middle income earners, it said.
Under the pensions matching idea, pension savings made from taxed income in a pension account would attract a 20% contribution from the government, up to a ceiling for individuals of SEK12,000 (€1,152), according to Insurance Sweden.
The state top-up would have no connection to tax paid, the group said, adding that it would be an advantage for low and middle income earners who did not earn as much on tax incentives as high income earners.
The plan also involved a starting ‘bonus’ for those who began saving before the age of 25, as a way of getting young people interested in their pension, the organisation said.
This bonus should amount to at least SEK200 per month for five consecutive years, the group said.
As part of Insurance Sweden’s plan, the state should require that individuals did not withdraw savings before, for example, the age of 61, it said, and that the pension plan was taken out for a longer period, preferably at least five years.
Jens Henriksson, chief executive of Folksam, and Fredrik Bergström, chief executive of Länsförsäkringar – along with the heads of Danica Pension, Swedbank Försäkring, Nordea, Handelsbanken Liv and SEB Pension och Försäkring – all put their names to an article outlining the pensions matching proposal in Swedish newspaper Dagens Industri on Sunday.