Hands off pension fund, say unions

Trade unions and consumer groups say a government plan to cut pensions is unreasonable, and will lead to greater poverty among senior citizens.

This content was published on January 11, 2010 - 10:38

Swiss voters will go to the polls on March 7 to accept or reject a proposal to lower the rate used to calculate payments of the occupational pension scheme.

The cut of about 0.6 per cent within a six year period would mean pensioners would receive up to SFr150 ($147) less a month, said union representatives.

The conversion rate presently is 7.05 per cent for men and 7.0 per cent for women. The reduction – the second within four years – would come into force gradually until 2016.

At a news conference in Bern on Monday, Rita Schiavi of the largest trade union, Unia, said one in seven seniors already lives below the poverty line.

The president of the Swiss Trade Union Federation, Paul Rechtsteiner said pensioners were defenceless since they had no means to compensate for the loss. Rechtsteiner said insurance companies would be the big winners if voters accepted the proposal.

An editor of two consumer magazines, K-Tipp and Saldo, said the pension and insurance firms were trying to win over voters with skewed figures, such as unrealistically high life expectancy.

A week ago, the business community and employers presented their arguments, saying an ageing population and lower capital gains on pension funds made the lower rate essential to ensure that money in the scheme did not dry up.

The occupational pension scheme is part of Switzerland’s three-tier retirement funding system, along with the state old age pension and private savings plans. and agencies

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