The reform of occupational pensions that will be submitted to the people on September 22 will not benefit workers, claims the Swiss Trade Union Federation (USS), which launched the “no” campaign on Tuesday. It denounces a reform that will benefit the world of finance above all.
The reform of the LPP provides for a reduction in the conversion rate – which determines the minimum amount of the future pension – in compulsory occupational pension provision from 6.8% to 6%. Pension reductions could amount to up to 3,200 francs per year, the referendum representatives calculate.
At the same time, the bill increases mandatory salary deductions. This will cost employers and employees up to 2,400 francs more per year. The result: net salaries will fall while pensions will decrease. For the unions and the left, the reform is therefore incomplete.
>> More details on the proposed reform: Federal Council launches campaign for LPP reform
No compensation
The text adopted by Parliament in March 2023 does not provide for any compensation linked to career breaks or the unequal distribution of work between men and women.
Nor does it solve the problem of compensating for rising prices, opponents point out. However, for years, all prices have been increasing while the amount of 2nd pillar pensions remains unchanged.
Over the past three years, LPP pensions have lost more than 5% of their purchasing power. While Parliament has been promising to solve the problem for decades, this reform does not change anything, the committee for the no vote still deplores.
Women and the over 50s at a disadvantage
This revision amounts to a dismantling project that will lead to a reduction in pensions for workers in catering, construction, sales or crafts, added Vania Alleva, president of Unia. Those who will be hardest hit are those who are now 50 or older. It will be up to 271 francs less in pension per month. “It is a theft of pensions.”
Furthermore, the pension gap between men and women is enormous: it reaches 41% for households with children, recalled the Green national councillor from Zug, Manuela Weichelt. She also regrets that the reform still does not recognise unpaid work, for example by introducing bonuses for educational and care tasks.
Flourishing pension funds
This situation is all the more difficult to accept since the pension funds are doing very well financially, noted USS President Pierre-Yves Maillard. “They manage a fortune of 1,100 billion francs, or 400 billion more than ten years ago, and they have accumulated more than 150 billion in reserves,” he told the press.
>> Read on this subject: Pension funds return to positive figures
The financial sector – banks, brokers and insurers – will benefit the most. Managing the financial assets of pension funds currently costs a little over 8 billion francs, estimates PS co-president Cédric Wermuth, who points out that brokerage fees in this area are still not regulated.
While the reform directly affects only the mandatory portion of the BVG, it will also have an impact on the portion of pension provision that exceeds the legal minimum. For this additional portion, the average conversion rate currently stands at 5.3%. “Since the legal conversion rate for the minimum benefit also affects the super-mandatory scheme, pension funds will have even more room to lower their conversion rates,” explained Adrian Wüthrich, President of Travail.Suisse.
>> See also: Paying more for a smaller pension? The reform that could hurt
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