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Row erupts over Swiss first-pillar pensions

SWITZERLAND – A row has erupted over a union call for an enhancement to Swiss first-pillar pensions – with an association of professional employees calling it a “wrong signal”.

The Swiss federation of trade unions, USS, earlier this week called for a CHF3,000 (€1,933) boost to first-pillar pensions.* At issue, it seems, is a dispute between the working and middles classes.

Now the association of employees of the machinery, electrical and mechanical industries, VSAM, has called the proposal “a wrong signal at the wrong time”.

“Employees of VSAM do not want any additional charge,” the association said in a statement.

“The employees cannot warm at all to the suggestion. It is particularly disturbing that once more the working population, and more specifically the working middle class and young families, is to be burdened. That is a wrong signal at the wrong time,” VSAM said.

VSAM, which has 20,000 members, was critical of the idea, saying it envisages a pension system where the first pillar would “undermine” the second pillar and “dismantle” the third pillar.

“It would put the weight for personal life standard on the shoulders of a few,” VSAM commented.

A spokesman for the association said VSAM had not liked the USS suggestion because the middle class would ultimately foot the bill for the changes, a spokesman for the association explained.

“We do not want to see financial pressure on the middle class, it is always the middle class paying for everything,” he said.

The spokesman also said the association was against the suggestion to tax third-pillar savings, a pension solution used by the middle classes.

“In view of the higher life expectancy it is far more convenient to keep the current first pillar level.

“In times of public debt and relatively high unemployment social security should be upheld but not further developed.”

The association would be more in favour of the introduction of a “citizen pensions” an idea popular in the academic circles, the spokesman said. He declined however to elaborate, saying the idea is still being developed.

* Early editions of IPE.com mistakenly gave the figure as CHF30,000.

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