The Swedish parliament (Riksdag) has voted unanimously in favour of a government proposal to allow more flexible rules on payments from pension insurance and pension savings accounts.

The new rule - pausad tjänstepension – will allow pensioners who have started to draw their occupational pension to pause payments during the first five years of receiving it.

The rule was first agreed by the cross-parliamentary Swedish Pension Group in October 2023, in an effort to encourage more elderly people to work. The Swedish government proposed to introduce a bill on this in June 2024.

Under the new rules, it will also be possible to change the payment period. For example, if a five-year payment period was initially chosen, it will be possible to change it to a longer payment period. The possibility of a break already exists in the national pension system.

Currently, the so-called five-year rule applies, which means that the capital in a pension insurance policy or a pension savings account may not be paid out for a period of less than five years and that payments during that period must be made in the same or increasing amounts.

The insurance industry has been lobbying for more flexible occupational pension rules for many years.

Commenting, Insurance Sweden senior economist, Eva Erlandsson, said: "It is long-awaited that this possibility is now introduced. In addition to helping to strengthen both pensions and the labour market, it is very positive that older people's work is encouraged.”

In June, Swedish Minister for Finance, Elisabeth Svantesson, said it is “important social partners and insurance companies work together to make this work in practice”.

Negotiations are currently ongoing between social partners about the proposal for collectively agreed occupational pensions.

Insurance Sweden believes it will be likely that a more flexible retirement pension will be possible for ITP (private sector salaried employees) from 1 October 2025 and for Avtalspension SAF-LO (private sector blue-collar workers) from 1 January 2026.

For employees in the state sector (PA16) and municipalities and regions (AKAP-KR), this is likely to be possible from 1 July 2025, Insurance Sweden said.

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