Sweden reforms pension system

As ill-advised as Sweden's addiction to the welfare state may be, at least it has moved to individual social security accounts. That's more than the capitalistic U.S can say.

  • Since Jan. 1, all Swedes who earn wages have been able to put 2.5 percentage points worth of their 18.5 percent payroll tax contribution into an individual account.

  • An individual worker may choose to invest in up to five mutual funds from among the 600 which are available.

  • The new programme, known as the Premium Pension System, passed the Swedish parliament with 85 percent approval.

    Observers say that journalists were particularly sceptical and often compared projected benefits under the new system with benefits under the old system – even though the old system was headed for bankruptcy.

    Source: Jeremy Hildreth (American Skandia, Inc.), Even They Do It: Socialist Sweden Surpasses America on Pension Reform, Investor's Business Daily, September 27, 2001.

    For more on Reforms in Other Countries http://www.mysocialsecurity.org/index5f.html

    FMF\3 October 2001
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