25 September 2017
Even though the Swiss voters rejected the 2020 Pension Reform on 24 September 2017, certain social and financial developments and their resulting consequences cannot be ignored.
- Life expectancy will continue to rise, while the asset performance is likely to continue to decline. The reduction of (too) high conversion rates and the adjustment of the technical bases will be even more urgent concerns in the foundation boards. Many pension funds with non-mandatory benefits have already reduced their conversion rates in recent years. This trend will continue in the future.
- The top priority for pension funds is to ensure financial stability in the long term. Therefore technical interest rates and conversion rates should be determined as accurately as possible by applying current demographic variables.
- In the interests of the insured and for the sustainability of benefits, the benefit and contribution levels must be assessed. The question whether current benefits may be paid in the future will also be the focus of such a review. If they cannot be ensured by means of appropriate measures, however, benefit reductions and/or contribution increases are inevitable.