Government proposes a change that would encourage people to combine disability pension with work

The Government’s proposal introduces a new flexibility model that would replace the current temporary provisions on the suspension of disability pension. Under the current suspension model, pension payments are stopped if the pensioner’s earnings exceed the income limit that applies to the pension for more than three months.

Under the new flexibility model, a flex amount (joustosumma) will be calculated for the disability pension recipient for the calendar year. It will allow earned income to exceed the monthly exempt amount from time to time without it affecting the payment of the pension.

Pensioners would continue to have a monthly exempt amount, which means the amount of wages or salary that they can earn per month without it affecting the payment of their pension.

In addition to the exempt amount, a flex amount would be calculated for the calendar year, which would allow for flexibility in situations where earnings vary from month to month.

In the case of pensions paid by Kela, the exempt amount would correspond to the full amount of the guarantee pension, and the flex amount would be double the exempt amount. In the case of pensions paid by authorised pension providers, the exempt amount and the flex amount would be based on the disability pension recipient’s earnings prior to the onset of their incapacity for work.

The aim is to enable pensioners to keep track of their situation and predict how any earnings they have will affect their pension.

The flex amount works like this:

• If the monthly exempt amount is exceeded, the excess is deducted from the flex amount.
• If there is still enough flex amount left to cover the excess, exceeding the monthly exempt amount will not affect the payment of the pension at all.
• If the flex amount has been used up, any earnings exceeding the exempt amount will be deducted from the pension paid to the recipient.

Because of the flex amount, holiday bonuses or other one-off income do not automatically reduce your pension if your earnings otherwise remain within the limits of the exempt amounts.

If a pensioner exceeds their monthly exempt amount continuously over a long period of time, the payment of their pension would change more permanently. The change will depend on the type of pension they receive.

In the case of disability pension and rehabilitation subsidy paid by Kela, their pension would be discontinued if they exceed the exempt amount continuously for 12 months.

In the case of a full disability pension paid by an authorised pension provider, their pension may be turned into a partial disability pension if they exceed the exempt amount continuously for 12 months.

A partial disability pension paid by an authorised pension provider would be discontinued if the pensioner exceeds the exempt amount continuously for 24 months.

The flexibility model would apply to:

• rehabilitation subsidy and disability pension paid by Kela
• guarantee pension paid by Kela to persons under the age of 65 who are unfit for work
• rehabilitation subsidy, disability pension, partial rehabilitation subsidy and partial disability pension paid by authorised pension providers
• years-of-service pension paid by authorised pension providers.

The proposed legislation is intended to go into effect on 1 January 2028. Kela will provide more details on the possible changes and their effects at a later date once the legislative changes have been confirmed.