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AMF Pension ex-CEO makes pensions agreement public

AMF Pension embattled former CEO Christer Elmehagen has reached an agreement with the firm's chairperson Göran Tunhammar to make public part of his controversial pension agreement.

The two paragraphs published at Elmehagen’s request on Thursday read as follows:

“AMF Pension’s remuneration committee has, as of January 1st 2004, decided that Elmehagen’s total pensions contributions should be fully paid by his 60th birthday.”

“The company’s remuneration committee has also decided that the total annual premium at this point shall be paid over a further 30 months, from July 1st 2006 – 31st December 2008, or over the period of time that Elmehagen remains in his position.”

These paragraphs were added to the agreement on February 3rd 2004 and were undersigned by Göran Tunhammar and Christer Elmehagen.

“I consider the process that applied after my 60th birthday to be very clear,” Elmehagen said.

“I don’t have it to hand what I had then. But the agreement was submitted to human resources which had to execute it. And they knew. That it should continue to run but not increase in the instance of pay rises or the like.”

“And it can be seen in the following year’s accounts that it concerns 770,000 kronor ($94,300) so it must have been that,” Elmehagen said.

AMF Pension has come under fire recently when it was revealed that the company awarded generous pension and bonuses to the company’s highest ranking executives at the same time as it announced cuts to pension payment to the millions of Swedes whose retirement savings are managed by the company.

Elmehagen alone earned around 100 million kronor ($12.6 million) during his ten-year career at the helm of AMF Pension, including a pension payment worth more than 30 million kronor.

Wanja Lundby Wedin, head of Sweden’s Trade Union Confederation (LO), who also sits on the AMF board, has faced scathing criticism for the decision to give Elmehagen such a generous pension.

PENSIONS

Sweden to increase retirement age from next year

A proposal for changes to Sweden’s pensions system could see incremental increases to retirement age beginning next year.

Sweden to increase retirement age from next year
Photo: Hasse Holmberg/TT

The proposal for reform to state pensions has been agreed on by parties on both sides of the political aisle, reflecting the political agreement which provided for the new Swedish government.

Later retirement age has been justified by the claim that people in Sweden “live longer and healthier lives”, but the last twelve years of life remain characterised by illness and failing health, news agency TT writes.

According to the proposal, the minimum age at which a state pension may be drawn will increase next year from 61 to 62 years. The right to retain employment, the so-called LAS age, will also be increased, from 67 to 68 years.

“We see a problem with the fact that people who want to continue working are not able to. We will now give people the opportunity to do that,” said Mats Persson of the Liberal party, who was part of the parliamentary group behind the proposal.

In 2023, retirement ages will increase again, with the minimum state pension age changing to 63 and the LAS age to 69. The so-called guaranteed pension, which is paid to those who have had little or no pension-qualifying income during their working lives, will also see an increased age limit from 65 to 66 years.

2026 will see further extensions, to 64 years and 67 years for the regular and guaranteed pensions respectively.

In a press statement, the government wrote that longer and healthier lives made the reforms to retirement age possible. Average life expectancy in Sweden has been found to increase by 3.5 hours every day.

But longer life expectancy does not necessarily correspond to better health in senior years, according to research.

International studies led by the Institute for Health Metrics and Evaluation (IHME) and the University of Washington recently found that Swedes have relatively high life expectancy – just under 82 years for both women and men – but that years with good health are considerably fewer, at just under 70 years.

Sweden fell outside of the top ten for countries with the most years of good health, the study found. Japan was the best-performing country, followed by Singapore, Andorra, Iceland and Cyprus.

The pensions proposal could therefore mean that retirement years will become increasingly unlikely to contain many years in which senior citizens can enjoy good health.

Persson told TT he disagreed with that conclusion.

“This agreement is based on the fact that we live longer as well as healthier lives. There is research to support that,” he said.

READ ALSO: How to manage your pension in Sweden – even if you're not planning to stay

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