The government has presented a new bill that aims to make age savings more attractive to Danes, especially for those receiving social benefits. The bill, which was introduced during the first reading in the Danish Parliament on Thursday, introduces a new deduction for contributions to age savings, which has been a big request from pension companies. Minister of Employment Ane Halsboe-Jørgensen explained from the podium that the new deduction is essential to fully utilize age savings. “This is something pension companies have been asking for in order to offer better conditions for their customers,” she said.
Anne-Louise Lindkvist, customer advisory manager at Sampension, pointed out that age savings have previously been surrounded by many complicated choices and negative consequences, making it difficult for many to decide whether to use the scheme. She added that a household receiving public subsidies such as free space or housing support may lose up to 550 kroner per month if a person in the household contributes to an old-age pension. The new bill will eliminate this offset. “It is a great advantage to remove the offset effect, which has been a cumbersome barrier for many,” Lindkvist said.
Age savings is a pension scheme where one can save money in their bank or with their pension company, and one of the major benefits is that there are no taxes or fees imposed upon withdrawal, even though there are no deductions for contributions. Despite the government’s efforts to make age savings more accessible, a survey conducted by Epinion for Sampension shows that many Danes are still not familiar with the scheme. Three out of four Danes surveyed indicate that they have either never heard of age savings, hardly know about it, or only know a little about it.
The bill is also part of a larger agreement to establish a green fund, where changes to the age savings scheme are intended to contribute to financing the fund.