Peter Norman called for radical changes to be made to the range of funds available to Swedish pension investors. He told nrpn: “I would welcome a severe cut in the supply of funds. I don’t think it is possible for any individual to understand the alternatives if there are hundreds of funds.”

Confusion over the sheer amount of funds had driven many people to invest badly, he said: “Sometimes when the consumer is not informed in a proper way they can make very irrational decisions. I personally think three or four choices could be enough. I don’t think it’s necessary to choose specific mutual funds; you should choose specific risk levels. You should just have, for example, low, medium and high risk. And behind these choices there should be a number of funds that could create this level of risk for the consumer.”

Mr Norman emphasised his was a personal view, but added the move would likely result in more people making active choices for their pension assets. He implicitly criticised the proposals made last year by Karl-Olof Hammarkvist, a professor at the Stockholm School of Economics, to reduce the PPM range to just 150 funds. Mr Norman said: “If you have 150 funds it is difficult to understand so a lot of people will just simply give up.”

In a far-reaching interview with nrpn, Mr Norman added he would welcome a merger between AP7’s two Premium Savings and Optional Premium Choice funds. He said: “It is a strange and costly argument to have both funds. If we can merge these two funds it will make for a more efficient management.”

HG

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