Pension indexing in other countries
As in Finland, the index adjustments of pensions in other countries are generally based on changes in the price index describing the development of consumer prices and the wage index that measures changes in wage-earners’ average earnings levels. In general, the pension indexes follow the adjustments in both the consumer price and wage indexes in a certain proportion.
Typically, when checking the accrued pension rights during a person’s working life, a different index is used when calculating the initial amount of the pension than when adjusting pensions in payment.
In addition to developments in prices and wages, the index adjustments may be affected by other factors such as the economic outlook or the ageing of the population. This group consists of countries that employ various adaptation indexes (for example, Sweden and Germany).