The Danish pensions industry has urged the government to get to grips with pensions policy, and said the latest piece of pensions legislation was nothing more than a bid for short-term tax revenue.
Carsten Andersen, deputy director of the pensions industry association Forsikring & Pension (F&P), said: "The government – and parliament – need a pensions policy compass". He argued that, due to the way earnings-related benefits are calculated, paying into a pension scheme is a bad deal for low- and middle-income groups as they approached retirement age.
Andersen criticised the government's decision last year to offer a tax discount on capital, or lump-sum pensions (kapitalpensionen) in exchange for shifting the taxation on the products to the saving stage and away from the payment phase.
He said that while many pension plans are now redirecting those payments that had been going into tax-deductible capital pensions into annuity pensions, there are still many people who will find it more advantageous to opt for the new capital pension product in future.
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