"What was the BVG 21 Reform?"

The vote on 'BVG 21' took place on the 22nd September 2024 and was rejected by voters.

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BVG is the German speaking term for your Swiss occupational / workplace pension (also known as LPP in French and Italian).

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The stated reasons for the BVG 21 reform are rising life expectancy and lower birth rate, both of which are leading to an aging Swiss population. This means that you will have more people claiming pension benefits than there are paying into the system, making it unaffordable in the long-term.

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The BVG 21 reform was proposing the following:

• The minimum conversion rate to be lowered from 6.8 to 6 percent.
• The entry threshold above which compulsory insurance applies was to reduce from CHF 22,050 (2024) to CHF 19,845.
• The coordination deduction was to be changed from a fixed value to a relative value. After 20 percent has been deducted, the remaining respective salary amount was to be insured.
  • A coordination deduction determines the amount of pay that is insured by the pension fund.
• The system of retirement credits would have been simplified. There would only have been two levels instead of four. The percentage rate for the age group of 25 to 34 years old would have been increased slightly, and it would have been reduced slightly for the other age groups.
• Certain people who were to retire in the 15 years after the reform came into force would have received a pension supplement as the conversion rate would have been more unfavourable to those nearer to retirement.
  • This was to be CHF 200.- per month for the first 5-years, CHF 150.- per month for the next 5-years, and CHF 100.- per month for the final 5-years.

Overall, BVG 21 was looking to ensure that occupational pension provisions were future-proofed and would not become under-funded in the long-term. However, Swiss voters did not agree with the methods proposed.

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The final results were:

• ‍Yes: 32.88%, with 810'877 votes
• ‍No: 67.12%, with 1'655'205 votes

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The canton of Zug had the highest percentage of 'Yes' votes, at 42.90%, whilst the canton of Jura had the highest percentage of 'No' votes, at 77.10%.

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You can visit the Swiss Federal Government website to find out more:

• German: https://www.bsv.admin.ch/bsv/de/home/sozialversicherungen/bv/reformen-und-revisionen/bvg-reform.html
• French: https://www.bsv.admin.ch/bsv/fr/home/assurances-sociales/bv/reformen-und-revisionen/bvg-reform.html
• Italian: https://www.bsv.admin.ch/bsv/it/home/assicurazioni-sociali/bv/reformen-und-revisionen/bvg-reform.html

This page is not available in English.

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‍Please note that all content within this response has been prepared for information purposes only. This response does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.