Nordic working group to suggest how to remove border obstacles

The group's chairperson is Essi Rentola. She estimates between a third and half of all the obstacles need to be solved on an EU level because they affect the entire Union and not only the Nordic countries.

Social security issues for people who move between Nordic countries are covered by EU regulation 883/2004 on the coordination of social security systems and regulation 987/2009 which lays down the procedure for implementing the regulation 883/2004. 

"We are 12 people from the different Nordic countries. Because Finland holds the Presidency of the Nordic Council of Ministers I was tasked with chairing the working group," says Essi Rentola, International Affairs Liaison Manager at the Social Insurance Institution of Finland (Kela), the provider of most of Finland's social security benefits.

For each obstacle the group members will give an account of the national legislation and what needs changing. What in the beginning seemed to be bilateral problems often turned out to affect several countries. The memorandum has already grown in size to encompass 115 pages.

"The idea is that we sum it up and then the ministers for labour will consider it during their meeting in the first quarter of 2012."

EU the greatest challenge

"Some of the problems are bilateral and some have even been solved when authorities have been made aware of the problem.

"Others involve the whole of the EU and these represent the greatest challenge. This will be a long process, but we will come up with proposals for which questions that are of a nature that can only be solved through changes in EU regulations 883/2004 and 987/2009. The main problems are early retirement pensions and sickness benefits. In these areas there is coordination but no harmonisation of legislation, so problems will always arise," says Essi Rentola.

She does not believe it is realistic to achieve more sweeping changes like the introduction of a common Nordic retirement age. Today this stands at 65 in Denmark, Finland and Sweden, while it is 67 in Norway and Iceland. 

"Social security is one of those questions which are solved on a national level within the EU. The two regulations build on the principle that social security systems should be coordinated. This is not about harmonisation like when you implement a directive. All national legislation has its own background and social frameworks. This means for instance that different countries have different definitions of incapacity.

"The Nordic countries have different national rules for the duration of sickness benefits and for when early retirement pensions/sickness benefit kick in. This can easily lead to problems for people who have paid social insurance contributions in at least two Nordic countries."

Many Finnish from Sweden

Problems arise when a person lives and pays social insurance contributions in one country where early retirement pensions  are paid at an earlier stage compared to the other country. In Finland this is a big problem because many people there have lived and/or worked in other Nordic countries, notably in Sweden. 

There were at the most 300,000 Finnish workers in Sweden during the 1960s and 70s. Around half of them have moved back to Finland. 

"We have identified the time for when the largest number of people who used to work in Sweden will retire. It is this year and in 2012."

Finns still mainly go to Sweden when they want to work abroad. Not that many Swedes work in Finland, however.

"They are mostly found in the Torneådalen at the end of the Bothnian Bay, an area where people feel they work in the same country no matter which side of the border they live on.

"From being a labour exporting country, Finland now imports labour. The problem of border obstacles also affects Finland's relationship with EU country Estonia, which after Russia has the most citizens living in Finland." 

Social tourism "not very common"

Essi Rentola does not believe what is sometimes called 'social tourism' is particularly common. Even if social benefits are more generous in one country it does not affect people's decision to move. 

"Family is generally the most important thing. Our information shows the only group whose movements are influenced by legislation is pensioners who might choose to move to a different country if this affects how much they have to pay in social insurance contributions," says Essi Rentola.   

The new EU regulations 883/2004 and 987/2009 identify which country has responsibility for an individual if two countries disagree on which of them should be responsible for social security. 

But Essi Rentola encourages anyone who is thinking of moving abroad to start early by reading up on the consequences this will have for their social security. Many things are easy to sort out before a move but might become difficult to solve once you are in the new country.