Luzern moves one step closer to pension recovery
SWITZERLAND - An advisory body to the regional parliament of the Swiss canton of Luzern has recommended officials approve proposed recovery measures for the region's pension plan but introduce a time limit in which this must be achieved.
The CHF4.3bn (€2.85bn) Pensionskasse for the canton of Luzern drew up a list of recovery measures last year, some of which needed to be approved by the cantonal parliament. (See earlier IPE story: Luzern finally secures recovery plan)
The Cantonal Commission has now agreed to contribution and retirement raises but criticised the recovery measures for not being limited to a certain time frame.
Moreover, the Commission wants the measures to end once the fund has reached a 100% funding level again.
At the end of 2008, the funding ratio of the Pensionskasse had dropped to just under 92% but it has recovered slightly over the last year.
Meanwhile, critics have pointed out that some pension funds are applying recovery measures such as 0% indexation even if they are not underfunded.
The social ministry confirmed to IPE that this was happening but only "very rarely".
A spokesman also said discussions are currently under way about the prospect of legal changes to determine the conditions under which pension funds may apply 0% indexation.
If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email firstname.lastname@example.org