Three per cent of Danish workers between the ages of 25 and 59 are not saving into a pension fund, according to analysis by Forsikring & Pension (F&P).

This is equivalent to around 63,500 people, with the majority being employees of self-employed people with a small income and people in the restaurant industry who are outside the otherwise mandatory occupational pension system.

F&P warned that this group faced a large drop in income as a pensioner as they are not building up any savings for retirement.

“It is expensive to be without a pension scheme as a pensioner, and therefore it is always a good idea to save for old age,” commented F&P deputy sirector, Karina Ransby.

“Our mapping shows that the 63,500 in the remaining group without a pension correspond to 3 per cent of all wage earners between the ages of 25-59.

“Fortunately, it's a small group, but we need to get the number down further.”

Ransby noted that F&P agreed with the government's intention for pensions to be extended to more people.

The government has also proposed that tax relief should be applied for those at the bottom of the income scale, and Ransby stated that it was obvious to pursue both goals at the same time.

“This can be done by instead increasing the deduction for pension contributions, as proposed by the Pensions Commission,” she said.

“An increased pension deduction acts as a tax break when the pension is a fixed part of the salary.

“And that increases the incentive to include a pension in the salary package for the small remaining group who are not saving for a pension.”

F&P emphasised that if the government wants to make use of legislation to get everyone in Denmark to save, the pension companies were ready to offer pension schemes for these groups that have no pension savings.

“The proposal from the Pensions Commission was a minimum pension for everyone,” Ransby stated.

“Our hope is that if you first become a customer of a pension company because you have to have a minimum pension, it can motivate you to increase your pension contribution further and thus ensure a higher income as a pensioner.

“In addition, you also get insurance against, among other things, loss of working ability by saving in a pension company.”

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