The union believes that a too low wage weight estimate was used in last year’s social security settlement, something the government will not fully compensate for. The pensioners’ union now hopes that the Storting will stop a proposal from the government.
Figures from Statistics Norway show that the average annual wage growth in 2021 was 3.5 per cent. This is 1.1 percentage points higher than the wage growth that was used as a basis for the pension adjustment in May last year.
The pensioners’ union reacts to the fact that the government will halve the compensation they believe the pensioners will receive in 2022. If this happens, according to the association, the pensioners will receive about NOK 1.4 billion lower regulation in 2022 than they should have.
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Requires full compensation
The full-year effect of this proposal – from May 2022 to May 2023 – amounts to a loss of NOK 2 billion for pensioners.
– This is completely unacceptable, says union leader Jan Davidsen in the Pensioners’ Association in a press release.
He demands that pensioners receive full compensation for using too low a wage growth estimate in last year’s social security settlement.
– When wage growth in 2021 turns out to be higher than projected in May, this must of course be fully corrected in the social security settlement in 2022. If the correct wage growth had actually been used, pensioners would have received what they should have last year.
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Not affordable
– It is thus not reasonable for the pensioners to receive anything less as a result of the previous government missing its estimates, says Davidsen.
He says in the press release that in the social security settlements there is a long tradition of correcting for discrepancies between the estimated and actual wage growth.
For 2021, it was decided that pensions should increase with the average of wage and price growth, but not higher than wage growth. In May last year, wage growth was estimated at 2.4 per cent and inflation at 2.8 per cent.
The pension increase was thus limited to equal wage growth of 2.4 per cent. In addition, the majority in the Storting agreed to ensure full compensation for a deviation between estimated and actual wage growth from 2020 of 1.4 per cent.
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Same objection
State Secretary Truls Wickholm (Labor Party) in the Ministry of Labor and Social Inclusion tells Nettavisen that the Pensioners’ Association came up with the same idea in 2021. Several employee organizations did the same.
– The Storting agreed with the demand from the Pensioners’ Association LO, Unio and the Joint Organization of the Disabled, as 2021 was a transitional year to change the regulatory regime.
– The fact that the Pensioners’ Association now makes the same objection is marked by the fact that the argument is adapted to the estimates for price and wage growth. If the deviation had had the opposite sign, the Pensioners’ Association would probably not have argued in the same way, says the State Secretary.
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Natural method
He refers to the protocol input from Unio, FFO and LO to the social security discussions in 2021. Here, according to Wickholm, it is stated that it is only in the transitional year 2021 that the deviation in the wage estimate will fully be reflected in the regulation.
– From 2022 onwards, it is natural to use the method now proposed by the government. This is a change that has been demanded by the pensioners’ organizations.
My understanding is that this premise was also the basis when the Storting in 2021 agreed to the demand for more favorable regulation in 2021, says Wickholm.
The case is now being considered by the Labor and Social Affairs Committee. The committee has until 1 March to submit its recommendation.
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