A campaign to win over voters in favour or against of a reform to Switzerland’s second pillar pension system has started, with a referendum date set for 22 September.

The Swiss Federation of Trade Unions, SGB USS, will be “vehemently involved” in the campaign to convince voters to “say no” to the reform of the second pillar passed last year by parliament.

According to the draft voted by parliament, the conversion rate to calculate pension payouts will decrease to 6%, from the current 6.8%, but the generation hit by pension cuts will receive compensation, among other changes.

SGB USS has firm backing against the reform from the Greens and the Social Democratic Party (SP).

“With the reduction of the conversion rate pensions will fall by up to CHF3,200 (€3,230) per year. Employees over 50 and the middle class are particularly affected,” the union said in a statement.

The reform ignores the fact that pension funds are accumulating reserves at the expense of members, and this leads to a lower pension received in old age, it added.

Pension funds association ASIP supports the second pillar review that in its view strengthens the occupational pension system.

ASIP,  Inter-pension, which is the organisation representing the interests of Swiss multi-employer pension schemes, and the Swiss Insurance Association (SVV) have drafted a fact sheet that is circulating with the most important points of the review.

The associations underline in the document that adjusting the conversion rate leads to strengthening the financing of the statutory minimum pension provision, breaking the redistribution mechanism from the young to the older generation.

Lowering the wage threshold to join a Pensionskasse at CHF19,845 per year, and adjusting the coordination deduction to define the share of the wage insured under the first pillar pension system, will better protect part-time employees, people with low incomes, or employees with multiple jobs, they added.

With the second pillar reform contributions for employees over 50 years old will fall, increasing the possibility that they will stay in their jobs for longer or that they will start a new job, according to business sector’s lobby economiesuisse.

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Luigi is IPE's Berlin-based DACH correspondent. His coverage includes regulation and the latest pensions and investments trends, and, being a native Italian, he also covers Italy’s pensions market. He has reported from Italy and Germany on international politics and business for European and US publications including USA Today, Bloomberg BNA and for the investigative magazine L’Espresso. He was previously Germany correspondent for Mergermarket covering M&A.View full Profile

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