Swiss Review 4/2022

footing over the last 20 years. “This impairs Switzerland’s ability to reform itself, and is particularly detrimental to young people like us,” he says, noting the disillusionment shared by many of his age. Voters to give their verdict in autumn But before the Young Liberals put their popular initiative to the electorate, there is another matter on the agenda. On 25 September 2022, voters will give their verdict on parliament’s latest reform package, OASI 21, which aims to balance OASI revenue and expenditure and secure the level of retirement benefits in Switzerland. OASI 21 would be funded by raising the retirement age for women from 64 to 65 and increasing VAT by 0.4 per cent. The reform would allow for greater flexibility in the retirement age and would also make it possible for pensions to be drawn gradually. Trade unions and left-wing politicians in particular are less than enamoured. Complaining that women will bear the brunt of OASI 21, they managed to collect the necessary number of signatures for a referendum in record time. Unions and left-wing parties want to increase pension benefits instead – and have submitted their own popular initiative to this end. People who have worked all their lives deserve a good pension, they say. Thirteen pension payments a year is the idea that they have put forward. But the Young Liberals are not happy with OASI 21 either, calling it “no more than a mini-reform or baby step”, to quote Matthias Müller. The youth wing of the FDP wants to go further by linking the retirement age to life expectancy. Whether it can convince older voters of the benefits of such a proposal is another matter altogether. Two contrasting initiatives to be put to parliament Which of the solutions is it to be? It is interesting that both popular initiatives will come to public attention when they are debated in parliament just a few weeks before the OASI 21 referendum. Will the electorate reject OASI 21 for fear that a yes vote would be interpreted as a signal for further hikes in the retirement age? Or will it endorse the reform and put paid to any pension increases? If opinion polls and previous referendums are anything to go by, voters are well aware that the state pension scheme is in questionable financial health. This is a pivotal moment for the state pension, and the situation is becoming critical, says the left-leaning coalition championing a 13th OASI pension payment. Such a How pension provision is structured in Switzerland At present, the maximum OASI pension is 2,390 Swiss francs per month per person. The minimum OASI pension is 1,195 francs. Married couples can receive up to 3,585 francs in total. These sums lend considerable purchasing power in countries where the cost of living is low, but are insufficient to make ends meet in Switzerland. Two other pension pillars help to fill the gaps. Besides the state pension consisting of OASI and supplementary benefits (pillar 1), occupational retirement provision based on pension funds (pillar 2) was introduced in 1985 while private pensions regulated by law (pillar 3) have been available since 1987. This three-pillar system is enshrined in the Federal Constitution. Its aim is to maintain the individual's customary standard of living in retirement or in the event of death or disability, for their own benefit or that of their survivors. However, people on low wages struggle to accumulate enough pillar 2 benefits and often lack the requisite income to build up pillar 3. (DLA) ‘Jassen’ sharpens your mental arithmetic skills. When it comes to retirement, relying solely on one's OASI pension is making the wrong calculation. That's because Swiss old-age insurance benefits are based on three pillars. Photo: Keystone Swiss Review / August 2022 / No.4 14 Society