Swiss voters on Sunday rejected pension reform aimed at stabilizing mandatory occupational pensions system and introducing pension flexibility.
The proposal, which would have raised taxes to fund the reforms, was defeated in a national referendum.
The 2020 pension reform was intended to guarantee a level of benefits, increase flexibility and close various loopholes in pension provisions of the first pillar pension system, the Old Age and Survivors' Insurance. The Swiss Federal Council and Parliament had said reform is urgently needed because no significant changes have been applied in the past 20 years.
Among the provisions, the Swiss government planned to increase pensions by 70 Swiss francs ($72) a month and increasing retirement age for women to 65 from 64. The reforms also would introduce more flexibility, by allowing plan participants to work until 70 rather than set a retirement age.
Association Suisse de Institutions de Prevoyance, the Swiss association of pension funds immediately called for a relaunch of the reform effort, stating any reform must not impose a financial burden on the insured and the employer, or inflate pension funds' administrative costs. "The increasing life expectancy and declining returns lead to a growing cross-subsidization of pensioners at the expense of the contributors," the association said.
Opponents of the reforms had also said the higher retirement age could lead to greater social injustice.
Patrick Emmenegger, professor of public policy and comparative political economy at St. Gallen University, said in an emailed comment: "The reform aimed to remove the structural deficit, as the share of workers to retirees declines. While necessary, the reform is also problematic. It (would) mostly shift cost to the young, does not increase incentives to work longer and expands benefits for everybody, rather than targeting the poor."