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Government announces pension increase

Increases to national and guarantee pensions will see retirees and others receive a minimum of about 1,000 euros per month.

Iäkäs nainen vetää pyörällistä laukkua perässään.
The government's draft proposal would see about 609,000 pensioners receive a small increase in their pension. Image: Henrietta Hassinen / Yle

Finland's government has arrived at specific numbers for raising the levels of national and guarantee pensions.

The national pension, a benefit paid by the state's benefits administrator Kela to retirees and people with disabilities, will be increased by 31 euros monthly.

The guarantee pension, which is provided when a retirement pension or earnings-related pension falls below the statutory income limit, will go up by 50 euros a month. This payment is intended to safeguard the livelihoods of low-income pensioners.

The proposals will be put forward for consultation by the government and may be subject to further modifications.

The Government Programme devised by Prime Minister Antti Rinne's five-party coalition, announced at the beginning of June, had allocated 183 million euros per year for the purpose of raising minimum pensions. This increase will bring the monthly pension payment up to about 1,000 euros per month. Approximately 609,000 pensioners will receive a small increase in their pension, according to the government's calculations.

Making good on campaign promises

The government further outlined that the housing allowance paid to pensioners will not be affected by the increase in the national or guarantee pensions.

"We are delighted and proud to present a substantial increase of 50 euros to minimum pensions," said Minister of Social Affairs and Health Aino-Kaisa Pekonen. "This proposal is intended to help those who need the extra money in their everyday lives the most."

The proposal is scheduled to be presented to parliament later in the autumn, with a projected aim of bringing the amendments into force on 1 January 2020.

The raising of minimum pensions was one of the key election promises made by Prime Minister Rinne's Social Democratic Party.

In a speech at a market square in Lahti in March 2018, Rinne promised to make improvements to all pensions under 1,400 euros if elected to government, thereby bringing more than 50,000 pensioners out of poverty.

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