Sweden’s Inkomstpensionen (income pension) is expected to increase by 0.5 per cent in 2021, the Swedish Pensions Agency has revealed.

The change will come into effect on 1 January 2021. The 0.5 per cent increase is slightly lower than the agency’s previous forecast published at the end of July, which predicted a 0.8 per cent increase.

However, it is better than the 1.5 per cent decrease, which was stated in the forecast published in May this year. The precise figure will not be known until the end of the year.

"In order to get an idea of what the total increase in income-based general pension will be, pensioners need to wait until December when the development of the premium pension is known," Swedish Pensions Agency head of analysis, Ole Settergren, explained.

Over the course of the year the Swedish Pensions Agency makes pension forecasts on the development of the income pension.

"Our forecasts have varied unusually widely during the year. The reason is that the assessment of the impact of the pandemic on income has varied. We have not previously put any emphasis on communicating forecasts for the income pension. This year, however, we have deviated from this tradition due to a great interest in the impact on pensions from Covid-19,” Settergren stated.

In its previous forecast, the Swedish Pensions Agency predicted that the income pension would reduce by -2.7 per cent in 2022. However, it now believes it will instead drop by -0.5 per cent.

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