'Raising Taxes Won't Be Enough': Sweden Raises Retirement Age Again
In response to a government report, Prime Minister of Sweden Fredrik
Reinfeldt has announced he will seek to increase Sweden's retirement
age. The Prime Minister also suggested this is just the first step
needed to keep Sweden's welfare system in balance.
The Swedish Commission on the Future issued a report which concluded
"raising taxes won't be enough to sustain expenditures associated with
Sweden's welfare state." In response to the report, Reinfeldt announced
"We're going to need to work a little more and a little later in life if
we're going to meet our welfare ambitions."
The Prime Minister's
immediate plan is to raise the mandatory age of retirement two years
from age 67 to 69. Early retirement would also shift two years, from age
61 to 63. Reinfeldt further suggested the retirement age would need to move as high as 75 in the near future.
The Prime Minister justified these proposals by noting that Sweden could only afford to raise taxes so much given global market competition:
This is a time of changes in the global world economy. The nations we
meet in open competitions don't have our welfare ambitions. They don't
put taxes on production to finance the pension system or welfare
solutions. Therefore the question remains, is our equation correct?
Sweden raised it's retirement age from age 65 to the current age of 67 less than two years ago. The Commission on the Future was established at that time to decide whether it would need to be raised higher.
current US retirement age under Social Security is age 67 (for those
born after 1960), with early retirement available at age 62.