Swiss pension funds can 'suspend' 2.25% guarantee - Government

SWITZERLAND – The upper chamber of the Swiss Parliament, Staenderat, (SR) has confirmed that pension funds in need of restructuring could suspend the minimum interest rate guarantee of 2.25% after the National Rat (NR), the lower chamber, decided to oppose the measure.

In the course of “a difference-clearing session”, the Staenderat (SR) yesterday also dismissed the possibility of envisaging a “right to reply” for pensioners in such matters.

Acknowledging the disparity between the lower and upper chambers, David Eugen, member of the Kommission für Soziale Sicherheit und Gesundheit, Social and Health Committee, said the SR should stand by its decision.

Eugen also reminded the chamber that the suspension of the interest rate would be applicable for a maximum of five years and could only be applied after increased contribution rates paid by employers and employees and “adjustments” applicable to pensioners did not work.

But according to MP Philipp Staehelin, the measures will only help “ a few.”

“For a few specific cases we sacrifice a principle and we question the minimum return, a decisive component of the BVG.” [the social security law - Bundesgesetz über die berufliche_Vorsorge], he said yesterday.

“We still believe that we should leave this option to boards of directors, those responsible for pension funds who will have to face a real problem,” said interior minister Pascal Couchepin.
“It is an extremely unpopular measure. If this decision is taken, every care will be taken to ensure that it is applied when there is really no alternative.”
“Let’s give more freedom to those who are responsible for pension funds and have heavy responsibilities”, he continued.

The matter will now be re-submitted to the NR.
If differences between the chambers still exist after three consultations, a committee made of MPs from both chambers will meet to try and reach a compromise.

The new bill should be to be introduced from August this year.

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