A proposed merger of the Norwegian local authority and government employee pension schemes is likely to lead to increased outsourcing of investment mandates to European asset managers.

Kommunal Landspensjonskasse (KLP), the Nkr90bn (€11.1bn) pension fund for local authorities, and Statens Pensjonskasse (SPK), the unfunded government employee scheme, have been discussing a proposed merger which would turn the government fund into a funded scheme and add Nkr20bn (€2.5bn) to the new entity every year.