Pension Funds - current status and vision for future 

 Iceland enjoys a reliable and simple pension fund system with an extensive accumulation of funds, mutual insurance and the compulsory membership of all salary earners and independent contractors.

New legislation on mandatory pension rights and the operation of pensions funds tends to strengthen and underpin the present system. Stability in issues related to pension funds is essential because the guarantee of pension rights is one of the most important concerns of any pension fund member.

Increased freedom of investment, favourable real returns in recent years and changes to the acquisition of pension rights have greatly improved the position of the funds. Demands for improved efficiency have led to the merging of funds. The accumulation of pension funds has assisted the development of a stock market and ensured widespread ownership in the majority of Iceland's largest companies.

The pension funds will respond to the demands of their members concerning the providing of information on pension rights.

The development of pension issues abroad, particularly in Europe, will certainly influence developments in Iceland, particularly a greater freedom in investments the by pension funds.

Over the next few years the pension funds will offer an even greater choice of pensions, both regarding minimum pension coverage and additional pension savings. The variety of the members' pension entitlements will therefore increase greatly although such changes will not lead to changes in mandatory membership of the funds.

The role of the IPFA is:

• To look after members' interests in every respect.
• To act as a representative in matters concerning the common interests of member funds when dealing with the authorities and other bodies.
• To initiate public debate on issues relating to the funds and pension issues and to promote their positive image.
• To publish and to fulfil an educational role by holding courses and seminars, publishing reports and providing other services to pension funds and their members. To promote efficiency and development in the operation of the member funds.
• To keep abreast of developments in pension issues abroad and take part in international co-operation between pension fund organizations.
• To work on special projects for individual pension funds within the organization in accordance with decisions made by their boards of directors, providing that such activities are financially viable and are compatible with their goals and purpose.