Pensions, Health and Long-term Care

Norway is currently implementing a major pension reform. The detailed legislation for the new national old-age pension was passed with support from a broad majority in Parliament in June 2009, and formally the new law has gone into force from 1 January 2010. The accumulation of pension rights in the new system will be proportional to life-time earnings subject to a social insurance ceiling defined in terms of yearly earnings.

Minimum protection will in the new system be provided through a Guarantee Pension that is fixed at the same level as the minimum old-age benefit in the present system. The level of the Guarantee Pension will in the future be indexed in line with the development in average wages. There will from the January 2011 be a flexible retirement from age 62 on actuarially neutral terms.Retirement benefits will from the same time be subject to longevity adjustments, implying that any future increase on longevity will automatically be translated into a proportional reduction in benefit levels. The new system will be fully integrated in the general state budget without a clearly defined and earmarked contribution system. Except for the longevity adjustment, the reform, does not establish mechanisms to secure a hard budget line for the relative financial burden of the old-age pension system.