Does the planned pension reform address the ageing issue?
Even if adhered to, the fiscal policy guideline will provide little in the way of additional budgetary resources to meet longer term spending pressures from an ageing population. The use of oil money under the rule would increase by only about 1 percentage point of GDP by 2030 relative to its present rate. Gross spending on public pensions, if no reforms are put in place, would rise by some 10 percentage points of GDP. Spending on health is also likely to rise as the population ages. Long term fiscal sustainability should thus be given more priority in policy-making, and room for manoeuvre in current fiscal policy should be decided within those lines. Norway’s unusually large prospective increase in public pension spending reflects generous benefits, a still-maturing system, and (especially) marked expected increases in future life expectancy. Reforms in the old-age pension system are currently under discussion, and three of the suggested measures – to introduce a life expectancy facto
Related Questions
- Is it only employees that join an organisation after the commencement of the pension reform act that can elect to opt out of a closed PFA?
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