The Farmers’ Early Retirement Aid is a Special Pension
The farmers’ early retirement aid is not a benefit of the earnings-related pension scheme although it is determined based on the earnings of the insured person in the earnings-related pension scheme. It is a form of agricultural assistance, a special pension, which is totally financed by public funds. Its purpose is to allow a correctly-timed change of generation before the old-age retirement age.
The farmers’ early retirement aid is based on the provisional Act on Farmers’ Early Retirement Aid. The Act will be in force until the end of 2018.
The Farmers’ early retirement aid is the only special pension in agriculture. It is paid to a farmer who gives up agriculture or forestry or a reindeer herder who gives up reindeer husbandry before the old-age retirement age.
The farmers’ early retirement aid is granted to the owner of the farm or his or her spouse. The surviving spouse of the owner of the farm is entitled to the farmers’ early retirement aid if he or she has a marital right to the farm. The spouse of the person giving up farming may be entitled to the farmers’ early retirement aid alongside his or her spouse for five years at the most before reaching the minimum age, but in that case that payment of the benefit will begin only once he or she has reached the required age.
The minimum age limit for the farmers’ early retirement aid is 56-60 years, depending on the form of early retirement. The age limit is affected by the time of the farmers early retirement and the age of the person who gives up farming.
The farmers’ early retirement aid is determined like the earnings-related and the national pension
The farmers’ early retirement aid consists of a basic amount and a supplementary component. If the person who gives up farming has children who are under the age of 16, the farmers’ early retirement aid is supplemented by a child increase.
The basic amount of the farmers’ early retirement aid corresponds to the disability pension payable to the farmer on his or her income based on the Farmers’ Pensions Act if he or she were to become disabled at the time of giving up farming.
The supplementary component amounts to the national pension that the farmer would have been granted at the time of giving up farming if he or she had had the right to a national pension awarded in the form of a disability pension. In 2015, the starting farmers’ early retirement aid amounted to an average of EUR 1,100/month.
In 2015, 600 insured farmers retired on this special pension for farmers. By the end of 2016, a total of 13,600 pensioners received a special farmers’ pension. The number of recipients of a special farmers’ pension is declining due to a decline in the number of farmers. The number of recipients of the special farmers’ pension was at its highest in the early 1990s.