Union: pension increase only benefits government

Pension payouts will increase at the start of next year, but social security benefits will not be adjusted for inflation until 1 January 2022.

With the new pension increase, an unmarried old age pensioner (OAP) with no income other than the old age pension and payments from the Samhaldsfasti Eftirlønargrunnur (the joint and several labour market pension fund) will next year have a disposable monthly income of about DKK 12,600. Married couples will have about DKK 22,000 per month after taxes and other contributions.

The monthly basic amount will increase by DKK 580, and the monthly tax allowance will increase by DKK 500, totalling an extra DKK 1,080 per month from 1 January 2021.

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But this is just a disguised way of making pensioners pay for the government’s austerity plans, argues Beate L. Samuelsen, chairwoman of the National Association of Pensioners.

“Yes, the payouts will increase, buy the amount will not be adjusted for inflation until a year later,” she says.

“The increased living costs, including the plans to increase health insurance rates, will eat up this small increase in no time”.

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She adds that governments have usually done well to consult with the pensioners’ association ahead of any major changes.

But this time there was no consultation on this matter, which the government puts down to time constraints related to the preparation of the 2021 budget proposal.

The relevant ministers were not available for further comment for yesterday’s Dagur & Vika news programme.

Translated by prosa.fo