Goals to extend working life will be concretized in pensions in 2017
In recent years in Finland, the extension of working life and the future sustainability of public-sector finances have been topics of extensive discussion. The EU Commission has encouraged Finland to consider linking the retirement age to the extending life expectancy. After the 2005 pension reform, changes in life expectancy were taken into account in the form of a life expectancy coefficient that regulates pension levels.
In September 2014, the Finnish central labour market organisations and the State agreed on an extensive pension reform that will come into effect as of the beginning of 2017.
As a result of the reform
- The grounds on which pensions are determined at different ages will become more unified and the age at which pension begins to accrue will be lowered to 17.
- The retirement age will be raised by two years (to 65 years) by 2025. After that, the retirement age will be linked to life expectancy.
- A new pension type will be introduced: the years-of-service pension. People who have worked for a long time in strenuous and wearing work may be eligible for this pension.
In addition, the reform will stabilise the pension insurance contributions far into the future.