Centre Party touts new Swedish labour model

The Centre Party, headed by Deputy Prime Minister Maud Olofsson, has put itself on a collision course with Sweden's two largest parties by calling for an overhaul of the country's much vaunted labour market model.

Centre Party touts new Swedish labour model

Speaking at a press conference on Tuesday, two days before the start of the party’s annual conference, Olofsson contended that Swedish labour laws are outdated and in desperate need of reform.

Current employment regulations hinder the development of new jobs, the party argues, with the Employment Protection Act (Lagen om Anställningsskydd – LAS) coming in for particular criticism.

The Centre Party advocates replacing LAS with a new “mini-LAS”. Currently, under the terms of the Act, companies with up to ten staff members are permitted to exempt a maximum of two employees from the principle of “last-in, first-out”.

The Centre Party’s proposal entails extending this principle to enable companies consisting of up to fifty people to exempt ten employees, while firms with forty members of staff could exempt eight people, and so on.

In order to make the proposal a marketable political product, the party has called for the simultaneous introduction of four new measures, two of which are aimed at wage earners and two at employers.

For employees, the party is prepared to raise unemployment benefits to 80 percent for a worker’s first three months out of a job. Furthermore, wage earners making regular contributions to a skills development account – a form of individual retraining insurance – are to be eligible for tax deductions.

Employers meanwhile are promised more flexible employment laws and lower social charges.

Olofsson admitted that the proposal would likely lead the party into a war on two fronts, as neither the Moderate Party nor the opposition Social Democrats are in favour of altering Sweden’s current labour market legislation.

“But we’re not going to change our mind just because others think differently,” she said.

In the long term, Olofsson said she would like to leave hiring and firing decisions entirely in the hands of employers with the current proposal constituting an initial step along that path. But she also insisted that the party was keen to find compromises that would appeal to groups representing both employers and employees.

“The unions have said they have a sense of insecurity. If that’s the price we have to pay for changes to LAS then we’re willing to pay it. But we’re not prepared just to raise unemployment insurance payments; the measures will all be introduced at the same time,” she said.

The Centre Party has also put forward a range of other proposals to stimulate the job market including salaries for apprentices, an extension of trial employment periods to two years and the removal of age restrictions for company start-up grants.

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Reader question: When am I eligible for a Swedish pension?

A reader got in touch to ask how long he had to work in Sweden before he was eligible for a pension. Here are Sweden's pension rules, and how you can get your pension when the time comes.

Reader question: When am I eligible for a Swedish pension?

The Swedish pension is part of the country’s social insurance system, and it can seem like a confusing beast at times. The good news is that if you’re living and working here, you’ll almost certainly be earning towards a pension, and you’ll be able to get that money even if you move elsewhere before retirement.

You will start earning your Swedish general pension, or allmän pension, once you’ve earned over 20,431 kronor in a single year, and – for almost all kinds of pension in Sweden – there is no time limit on how long you must have lived in Sweden before you are eligible.

The exception is the minimum guarantee pension, or garantipension, which you can receive whether you’ve worked or not. To be eligible at all for this, you need to have lived in Sweden for a period of at least three years before you are 65 years old. 

“There’s a limit, but it’s a money limit,” Johan Andersson, press secretary at the Swedish Pension Agency told The Local about the general pension. “When you reach the point that you start paying tax, you start paying into your pension.”

“But you have to apply for your pension, make sure you get in touch with us when you want to start receiving it,” he said.

Here’s our in-depth guide on how you can maximise your Swedish pension, even if you’re only planning on staying in Sweden short-term.

Those who spend only a few years working in Sweden will earn a much smaller pension than people who work here for their whole lives, but they are still entitled to something – people who have worked in Sweden will keep their income pension, premium pension, supplementary pension and occupational pension that they have earned in Sweden, even if they move to another country. The pension is paid no matter where in the world you live, but must be applied for – it is not automatically paid out at retirement age.

If you retire in the EU/EEA, or another country with which Sweden has a pension agreement, you just need to apply to the pension authority in your country of residence in order to start drawing your Swedish pension. If you live in a different country, you should contact the Swedish Pensions Agency for advice on accessing your pension, which is done by filling out a form (look for the form called Ansök om allmän pension – om du är bosatt utanför Sverige).

The agency recommends beginning the application process at least three months before you plan to take the pension, and ideally six months beforehand if you live abroad. It’s possible to have the pension paid into either a Swedish bank account or an account outside Sweden.

A guarantee pension – for those who live on a low income or no income while in Sweden – can be paid to those living in Sweden, an EU/EEA country, Switzerland or, in some cases, Canada. This is the only Swedish pension which is affected by how long you’ve lived in Sweden – you can only receive it if you’ve lived in the country for at least three years before the age of 65.

“The guarantee pension is residence based,” Andersson said. “But it’s lower if you haven’t lived in Sweden for at least 40 years. You are eligible for it after living in Sweden for only three years, but it won’t be that much.”