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AMF Pension reaches settlement with ex-CEO

The former CEO of Swedish pensions firm AMF Pension has agreed to reimburse his old employer following a bonus scandal that jeopardized the career of trade union chief Wanja Lundby Wedin.

Christer Elmehagen agreed in an out of court settlement on Tuesday to pay back the sum of 2.6 million kronor that he had moved from the company prior to an announcement to cut dividend rate payments to pensioners following stock market falls.

He has also agreed to return 6 million kronor of a pension payment worth more than 30 million kronor.

The decision to give Elmehagen such a generous pension was approved by Wanja Lundby Wedin, head of Sweden’s Trade Union Confederation (LO), who also sits on the AMF board.

Elmehagen said it felt good to reach an agreement with AMF Pensoin and avoid a lengthy legal process.

“I want toable to move on and I think this is a very important step,” he told news agency TT.

AMF said in a press release that the ex-CEO’s generous pension was not in line with the board’s intentions. But the company also conceded that the agreement it signed with Elmehagen had been open to interpretation.

“For this reason we have agreed to share the responsibility,” AMF said in a statement.

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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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