George Kudrna
Like many other developed countries, Norway is facing a rapid ageing of its population that is attributed to both falling mortality and fertility rates in the past and projected life-expectancy increases over the next several decades. According to United Nations (2015), it is projected for Norway that by 2060, the share of the population 65+ will increase to over 25% (from 16% in 2015) and the potential support ratio will drop to 2 people in the labour force for each person aged 65 years and over.
Such fundamental demographic change will have wide-ranging implications for the Norwegian economy and, in particular, for its National Insurance Scheme (NIS) that provides citizens with old-age and disability pensions. It is estimated that if the old pre-reform National Insurance Scheme had remained unchanged, the government expenditure on the old-age pension would have more than doubled from about 6% of GDP in 2013 to 13% of GDP by 2060, with additional spending of around 4% of GDP on disability pension (Fredriksen et al., 2015).
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