The most important facts about the pension initiative in brief
Published: Sunday, Mar 3rd 2024, 04:51
Updated At: Sunday, Mar 3rd 2024, 04:51
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This Sunday, the people and cantons will decide on the popular initiative "For a secure and sustainable pension scheme (pension initiative)". The initiative, launched by the Young Liberals, first calls for a retirement age of 66 and then for it to be linked to life expectancy. Here are the most important points in brief:
The initial situation
The retirement age for men is currently 65, while the retirement age for women is - still - 64. The AHV reform, which was approved at the ballot box in 2022, will also increase the retirement age for women to 65 from 2025 and in stages until 2028. The higher retirement age for women, higher salary deductions and the increase in value-added tax from the beginning of 2024 should keep the AHV in financial balance until around 2030. Parliament has already ordered a further reform bill from the Federal Council for the period after that. This should be ready by the end of 2026.
The AHV works according to the pay-as-you-go principle: what the working population pays in as contributions is paid out to pensioners as a pension. However, increasing life expectancy and the growing number of pensioners - not least due to the retirement of the baby boomers - are likely to put the AHV in financial difficulties because fewer working people will have to finance more pensioners.
This is what the initiative
The pension initiative calls for a further increase in the retirement age to safeguard AHV pensions. In a first step, following a "yes" vote, this should rise in stages for men and women to 66 years by 2033, from January 1 of the fourth year after acceptance. After that, the retirement age should be linked to the average life expectancy of 65-year-olds. Anyone approaching retirement must know five years in advance when they will reach retirement age. This is intended to provide planning security. Annual adjustments of a maximum of two months are permitted.
The initiators expect the retirement age to rise by around one month a year from 2033 and to reach around 67 years and 7 months in 2050. However, the retirement age will not increase in line with life expectancy, but by a factor of 0.8. So if life expectancy increases by two years by 2050, for example, the retirement age would only rise by 19 months.
The initiative committee/the supporters
Linking the retirement age to life expectancy is the only sustainable solution for old-age provision, writes the Pension Initiative Association. This is because the financing and long-term security of the AHV is at risk because the population is getting older and older. Without a reform of the AHV, the old-age pension scheme would face bankruptcy. By 2050, a contribution deficit of over CHF 10 billion is looming.
The initiators want to allow industry solutions for early retirement, such as for physically demanding professions. And because more skilled workers are available to the Swiss labor market, the initiative could also slow down immigration, they argue.
The pension initiative was launched by the Young Liberals. Supporters include the FDP, the SVP, the trade association and the employers' association.
The opponents
The Federal Council and Parliament reject the initiative. The Federal Council argues that an automatic system anchored in the constitution that links pensions and life expectancy is too rigid. When determining the retirement age, the development of the economy and labor market as well as the state of health of people in the country should also be taken into account. A political discussion on the retirement age must be possible.
The Federal Council also believes that it is not appropriate to raise the retirement age once again before the increase in the women's retirement age has already been decided. According to the Federal Council, the next AHV reform for the period from 2030 has already been prepared. A higher retirement age could also be discussed in this context.
Representatives of the SP, the Center Party, the Greens, the GLP and the trade unions were among the main opponents of the initiative in the No Committee.
©Keystone/SDA
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