Reorganisation of pension affairs – memorandum

The attached motion was put forward at the council's meeting today.
morning. 

The Town Council of Hafnarfjörður regrets that it has not been possible to reach an agreement.
a conclusion on the reorganisation of public sector pensions. Instead of attending
to weaken the pension funds with debt instruments that would come due in the next
In thirty years, unless things change, the local authorities will have to bear the cost.
an increase in employer contributions to these pension funds by 3.6-4.5%. Additional wage costs
The municipal contribution to this next year amounts to approximately 3.5 billion. Total contributions in
These public pension funds will therefore, with employee contributions, become
19.1-20.81 TP3T of wages. This increased wage cost will lead to many
Local authorities are being forced to withdraw plans for construction and expansion.
services in the coming years and their scope to accommodate pay rises in the coming years
The years will be very limited. It is also a matter for consideration when it comes to a fifth.
The cost of wages is used to pay for employees' salaries after their retirement.
instead of paying a portion of them to staff immediately and thus increasing
their contemporaneous disposable income. This is particularly true of young people who with
At considerable cost, one must secure safe accommodation for oneself and one's family early on.
the path of life. The Town Council of Hafnarfjörður urges Members of Parliament, the new government
and the contracting parties to take this matter up again as soon as possible after
hold elections and finish it before the next New Year so that they will not have to take place
an increase in the employer's contribution to the public pension fund which will come into effect on 1st.
January 2017 as is.

The minutes from this morning's council meeting can be accessed here.