additional services, the bad alternative

Many people who would be entitled to them do not request additional benefits, out of ignorance or shame.Image: keystone

Opponents of the 13th AVS pension claim that the additional benefits would make it possible to better combat poverty among the elderly. But the rules for qualifying for it became stricter during the last revision.

02/12/2024, 09:0702/12/2024, 09:08

Peter Blunschi

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Opponents of the 13th AVS pension are nervous. Certainly, the share of “yes” to the popular initiative of the Trade Union Union has decreased. But acceptance still seems possible, which is why opponents argue that a majority of retirees are doing well, or even very well, financially.

To listen to the opponents, retirees would not need this “AVS bonus”. And for people in need, there are additional benefits (PC), therefore a 13th AVS pension is useless and above all costly. What should we think of this argument? On the one hand, the phenomenon of poverty among the elderly is not an exception:

“One in six people of retirement age live in poverty or on the poverty line”

Pro Senectute

The foundation, which is committed to the interests of older people, is politically neutral and makes no recommendations regarding the two popular initiatives on which we will vote on March 3. The reference to additional benefits as an alternative to the 13th AVS pension is however “a double-edged argument”, assures the head of communications Peter Burri, interviewed by watson.

Retirement house, a risk of poverty

Elderly poverty mainly affects AVS beneficiaries who do not receive a pension from the pension fund. Or who live in a retirement or care home and cannot “assume” the often high costs associated with this alone. “Around 50% of PCs go to people living in homes”, confirms Peter Burri. PC costs amount to 5.5 billion francs per year.

This amount is expected to reach 6.5 billion by 2030. Currently, a little more than 12% of the elderly population receives additional benefits to the AVS. Some elderly people affected by poverty give it up, out of ignorance or shame. However, PCs are not a “handout”, but are an integral part of State social insurance.

“We have tightened the rules”

But saying that supplementary services are the solution to all problems is a bit easy. Indeed, the amount of benefits depends in part on where you are. It is the cantons and municipalities which are responsible for the allocation of PCs, and some of them pay a little more than what the Confederation prescribes.

So there is some “inequality” in the system. Added to this is the fact that the granting criteria were strengthened by the Federal Council and Parliament during the latest PC reform in force since the beginning of 2021. “We have tightened the rules”, underlines Peter Burri of Pro Senectute . Three points are particularly the subject of discussion and criticism:

Wealth limit

With the reform, only people whose assets are less than 100,000 francs are entitled to additional benefits. For married couples, the threshold is set at 200,000 francs. Owner-occupied properties are excluded, but not a possible holiday apartment.

Wealth consumption

The amount of wealth consumed by a person who asserts their right to additional benefits will now also be controlled, with retroactive effect over ten years. Retirees who, once retired, enjoy life, for example, by traveling, then realize that their pension is not enough, must now account for these expenses.

The maximum authorized consumption of assets is 10% per year. There are also exceptions in this case, for example for the maintenance of real estate or medical (dental) costs. Voluntarily giving up one’s fortune, for example by prematurely “bequeathing” to one’s children a house whose value is lower than the official estimate, can on the other hand lead to reductions in PC.

Reimbursement obligation

Here is the rule that annoys the most. Heirs may be asked to repay additional benefits after the death of a beneficiary. However, there is a deductible of 40,000 francs. In practical terms, this means that people who receive PCs can continue to live in their house, but the heirs may have to sell it after their death. The idea was launched by the Center’s former national advisor Ruth Humbel.

“There is no human right to inheritance”

However, last year, the Social Security and Public Health Commission (CSSS) of the National Council adopted a motion asking the Federal Council to reconsider the reimbursement obligation.

Representatives of the SVP also voted in favor, out of concern for farming families. Among them, there are many retirees in need, because they often do not have a pension fund pension. The obligation to repay could lead the heirs to have to sell the farm or take out a loan, they fear. The Federal Council intends to accept the motion.

Thousands of people are at risk to lose their PCs

Representatives of cantonal compensation funds expressed their astonishment to the Tages-Anzeiger. They believe the fears are exaggerated. It is true that the PC reform provided for a three-year transition period. It only came into full force in 2024, but the first consequences for PC beneficiaries are already being felt, as reported by Sonntagsblick.

Several thousand retirees must expect reductions or even the loss of their supplementary benefits, mainly due to the tightening of wealth rules. The Swiss Conference of Social Action Institutions (Skos) therefore expects that nearly 8,000 PC beneficiaries will lose their rights throughout Switzerland. Two thirds of them are retirees.

Pro Senectute requests a increase PCs

Around 70,000 people have also received fewer PCs since the start of the year. “In recent years, politics at national and cantonal level have increased the obstacles to obtaining PC and social assistance in many areas,” Skos director Markus Kaufmann told the Sonntagsblick. Many people are therefore ashamed to call on these aids.

Higher AVS pensions

In politics, we therefore strive to raise the lowest AVS pensions. During the winter session, the National Council forwarded a motion to this effect from Bernese Liberal Party Melanie Mettler without opposition. A motion with the same content from Beat Rieder (Center) is pending in the Council of States. PCs should expressly not be affected.

Peter Burri of Pro Senectute calls the idea “exciting”. However, he points out that the current AVS distribution mechanism would thus be “undermined”. This is why additional benefits are “perhaps more effective and more targeted”, according to him. However, they should be developed and more encouraged at home care.

Another problem, already deplored by Pro Senectute in December, is that of the rent maximums for the calculation of PC rights. They have certainly been adapted for 2023, but last year the reference interest rate was increased twice. This puts “people at the minimum subsistence level in need,” warned Pro Senectute in a press release.

Supplementary benefits are in principle a sensible way to alleviate poverty among older people. But they cannot really serve as an argument against the 13th AVS pension. Indeed, with the latest reform, you have to take it upon yourself to benefit from additional services. While a “boost” from the AVS is automatically paid into the account.

Translated and adapted by Noëline Flippe

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