May, the Danish Pension Commission presented its final
report. One of the recommendations is that the standard retirement age
should rise more slowly in future. The Pension Commission also advocates that
the same standard retirement age should apply to all occupational and
Pension Commission was established in 2020 under the chairmanship of former
Minister of Labour, Jørn Neergaard Larsen. In particular, it will look at the
advantages and disadvantages of differentiated standard age limits, examine the
relationship between the development of life expectancy and healthy lifespan
for different socio-economic groups and analyse the effects of a slower
increase in the standard age limit from 2040.
Pension system should become fairer across generations
of the pension commission is to make the pension system fairer across
generations. According to the currently valid regulation, the pension phase is
the same for all generations. The inevitable consequence of this is that future
generations will have to work longer than current pensioners as life expectancy
increases. Nor is it certain that people will still be healthy enough to work
at an advanced age.
the Pension Commission considers it problematic that the previous formula for
calculating the standard retirement age is based on the increase in life
expectancy from the age of 60, whereas the standard retirement age today is 67.
Thus, increases in life expectancy below the statutory retirement age are also
included in the calculation. Thus, the increase in life expectancy from the
standard age limit is overestimated. The consequence is that the actual pension
phase will be lower than calculated in the future.
Standard retirement age continues to rise albeit at a slower pace
this background, the Pension Commission proposes a slower increase in the
standard retirement age from 2045. To this end, the increase in life expectancy
from the respective valid standard age limit is to be used in the calculation
formula for the standard age limit. The increase in life expectancy calculated
in this way is to be divided 80 per cent and 20 per cent between working life
and retirement respectively. As a result, the standard retirement age would
rise from 67 years today to 74 years instead of 77 years by 2100.
No different standard age limits for individual social groups
to the Pension Commission, there are large differences in the life expectancy
of different social groups. People with a low level of education and in
physically demanding jobs have a significantly lower life expectancy on average
than academics. However, the Pension Commission is of the opinion that this
question of justice should not be regulated by different standard age limits of
social groups. Instead, this must be addressed through rehabilitation,
disability pensions, occupational health and safety as well as qualification
and further training.
Incentives to work in old age and saving for retirement
Pension Commission also recommends creating the possibility to interrupt the
pension phase to take up gainful employment. Incentives must also be created to
ensure that everyone makes sufficient provisions for the retirement phase.