On Tuesday 16 February, Timo Kietäväinen, MSocSc, was appointed as the new managing director of the Finnish earnings-related pensions institution Keva by the Keva Council. Currently serving as the Deputy Managing Director of the Association of Finnish Local and Regional Authorities (AFLRA), he will join Keva in May.
- Timo Kietäväinen has excellent knowledge of local government administration and the changes taking place in the municipalities’ operating environment. His competence and extensive networks provide a solid foundation for his role as a managing director to take on Keva's challenges where the focus will be on the impacts of the regional administration and social welfare and health care reform on the pensions system, says Harri Jokiranta, Chair, Keva Council.
The Keva Board of Directors decided by 6 votes to 3 to propose Timo Kietäväinen as Keva’s managing director on 28 January. Reporting to the Board of Directors, the managing director is responsible for Keva's operations and finances and assisted by the management team.
- Under the leadership of Timo Kietäväinen, Keva will continue its responsible attendance to pension matters and pension assets as well as the systematic development of its own operations. We will seek to have an active influence on Keva’s role in our changing operating environment, says Anna-Kaisa Ikonen, Chair, Keva Board of Directors.
Keva and Timo Kietäväinen have signed a managing director’s employment contract published in Finnish on the Keva website.
Earnings-related pensions important issue in social welfare and health care reform
If decisions are made on the basis of current information or assumptions, from the beginning of 2019 around 230,000 municipal employees will be employed by a new administrative unit – a county. This will be the largest transfer of personnel that has ever taken place in Finland and will also affect the earnings-related pension system.
- For those transferred to counties from municipalities, joint municipal authorities and central government administration, the clearest approach is to make the counties Keva’s member organisations and provide all those moving to a new employer with pension cover under the new Public Sector Pensions Act. In practice, Keva would process the pension applications of employees transferred to the counties and pay their pensions when they retire, says Timo Kietäväinen.
Municipalities and joint municipal authorities will have less than half of their current personnel. At the same time municipalities and counties will be able to establish companies responsible for service production. This may mean an essential decrease in the number of those paying for local government pensions. This would result in pressure to increase municipalities’ and municipal employees’ pension contributions by several percentage points as well as the dissolution of funds faster than planned.
- The best way to secure the pensions of the employees transferring to the counties and the funding of the local government pension system is to use Keva as the pensions provider of the companies producing services for the counties and municipalities. Otherwise the companies would have to contribute in other ways towards the costs of the local government pension system, Kietäväinen sums up.
For more information, please contact:
Harri Jokiranta, Chair, Keva Council, Deputy Chief Executive, phone +358 40 774 8402
Anna-Kaisa Ikonen, Chair, Keva Board of Directors, Mayor, phone +358 3 5656 6400
Timo Kietäväinen, Deputy Managing Director, Association of Finnish Local and Regional Authorities (AFLRA), phone +358 400 486 043