KLP restructures pensions for public-sector employees
Written by Sunniva Kolostyak
New regulations for employees in the public sector will allow members to combine work and retirement, Norwegian fund KLP said.
Earlier this year, Norwegian organisations representing employers and employees agreed on changes to the public sector occupational pension in a reform that will make it easier to combine work and pension, as well as planning when to retire.
The regulations will come into effect on 1 January 2020, and despite providing a greater choice for individuals, it will require more information.
Employees in the public sector will for the next decades receive a pension with elements from both the old and new occupational pension schemes, supplementing large groups with individual guarantees and transitional schemes. KLP is in the process of implementing IT systems to handle these challenges for both employers and their employees.
KLP CEO Sverre Thornes said: “KLP is well-equipped to meet increased complexity as a result of regulatory changes. New regulations provide greater choice for individuals and will create a greater need for information.
“Requirements toward expertise and systems at the suppliers will increase. We are on schedule with establishing a new pension guide, where our members can simulate how different pension and work choices will impact their pension.”
The fund also announced its quarterly numbers and returned 1.6 per cent on customer’s assets in the third quarter of 2018. KLP has grown 2.9 per cent and NOK 6.1bn (€1.7bn) in total so far this year, with property and equity contributed the most to the return.
“The return on our customers’ pension fund is well above the return we have guaranteed, and our costs are low. This creates value for our customers and our owners,” said Thornes.
“We are very well equipped to face weaker periods without affecting our customers.”
The fund, which acts as a pool for municipalities across the country, pointed out that despite the current reforms happening in Norway, where municipalities and regions are merged, it so far does not seem to be producing big movements in customer relations.