SWEDEN - A temporary change in legislation resulted in the Swedish pensions system suffering a hike in liabilities, unmatched by any increase in assets.
Annika Sunden, head of pensions at the department of research and statistics, Försäkringskassan, told Global Pensions: "A temporary decrease in contributions on the benefit paid to the disabled had a negative effect on the pension system."
The contribution level from benefit recipients was lowered from 93% to only 80% of the total amount.
Sunden continued: "The government had intended the change to be permanent, but the opposition party argued to be so would breach current laws, so it was revoked."
The report carried articles covering the argument for and against the reduced contribution levels by the government and opposition parties.
The number of years a Swedish crown stays in and is invested by the pension system has also begun to adversely affect the overall position.
Sunden explained: "Assets are calculated on the annual cash inflow and how long a crown stays in the system. This time is getting shorter as people start work later."
She added although in general the Swedish population was retiring later, it was not happening at the same rate so was not enough to counteract the trend.
Mats Langensjö, head of institutional business for the Nordic region at Pioneer, said the report confirmed the country's pension system continued to do well.
Langensjö said: "The AP funds work well as a buffer to the rest of the system which is overall very healthy.
"If there was a Nobel Prize for pensions, Sweden would surely win it!" he concluded.
The report drew attention to issues facing the pensions system over the coming years including raising the retirement age and pensioners living on low incomes.
The report showed the system had a SEK18bn surplus at the end of 2007.
The five AP buffer funds accounted for 12.8% of assets and all contributed positively to the annual return.
There is just one week left to register to enter the Workplace Savings and Benefits Awards 2018.