Sweden’s government employers’ agency has expressed scepticism about the mooted benefits of merging some of the AP funds, and warned support available for any staff from the national pension funds facing redundancy would be limited.
In its consultation response to the proposals published in June by the Finance Ministry to modernise the management of the five AP buffer funds behind the income pension, and increase its efficiency, the Swedish Agency for Government Employers (SAGE) said it was “cautiously positive” about changes leading to efficiency improvements and better returns.
The agency added: “Hopefully this will lead to better pensions.”
“However, the Swedish Employers’ Agency finds it difficult to assess which of the proposals in the memorandum will de facto lead to this,” it said.
The body said that in this context, it wanted to emphasise the difficulty of making realistic calculations of this type of organisational change.
“Experience shows that the costs and time before the proposals take effect are often underestimated and that the efficiency improvements are often overestimated,” SAGE said.
The agency said it particularly wanted to highlight the importance of some issues related to work on a possible merger of AP6 with AP2 – the two Gothenburg-based buffer funds — and the transfer of activities from the Stockholm-based funds, AP1, AP2 and AP3, to one or two new funds.
The AP funds receiving the business needed to assess whether this was a business transfer according to Section 6 b of the Employment Security Act (1982:80), and also had to be given enough time to make that assessment, SAGE said.
“If the change is handled as a business transition when the prerequisites are lacking, it will have employment law consequences,” it warned.
The agency also said the AP funds were not covered by state collective agreements, but by the collective agreement for financial sector employers’ organisation BAO.
“This means, among other things, that the AP funds are not covered by the government agreement on restructuring, and that employees of the AP funds cannot therefore receive support from the Job Security Foundation if they were to be dismissed due to a lack of work,” SAGE said.
The Job Security Foundation (Trygghetsstiftelsen), supports Swedish government employees in their transfer to new jobs.
A month ago, AP3 said in its response to the consultation that when one of the Stockholm-based buffer funds was axed, it favoured the assets being passed to just one surviving fund – not divided equally between the remaining two funds as has been suggested.
The proposals outlined in the reform plan which concern consolidation of the AP funds are set to enter into force on 1 July 2026.
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