ZURICH (Reuters) - Swiss voters were set to reject raising women’s retirement age to 65 in a referendum on shoring up the wealthy nation’s pension system as a wave of Baby Boomers stops working, projections by broadcaster SRF showed on Sunday.
The package being decided under the Swiss system of direct democracy included making retirement between the ages of 62 and 70 more flexible and raising the standard value-added tax (VAT) rate from 2021 to help finance the stretched pension system.
Authorities pushing the first serious reform of the pension system in two decades had warned that old-age benefits were increasingly at risk as life expectancy increases and interest rates remain exceptionally low, cutting investment yields.
The government-supported plan sought to secure the level of pensions through 2030 by cutting costs and raising additional revenue.
Minimum pay-out rates would gradually fall to stabilise the mandatory occupational pensions system and workers’ pension contributions would rise, while public pensions for all new recipients would go up by 70 Swiss francs ($72.25) a month.
The retirement age for women would have gradually risen by a year to 65, the same as for men.
“That is no life,” complained one 49-year-old kiosk cashier, who identified herself only as Angie. “You go straight from work to the graveyard.”
The three-pillar Swiss pension system combines public benefits with employer schemes and voluntary savings plans.
Some critics complained that the higher retirement age for women and higher VAT rates were unfair, while others opposed expanding public benefits and said the reforms only postponed for a decade rather than solved the system’s financial woes.
Opinion polls had shown the reforms just squeaking by, but support had been waning.
The plan earmarked 0.3 percentage point of VAT revenue for public pensions from next year and 0.6 percent from 2021. That would contribute roughly 2.1 billion francs a year by 2030.
But actual VAT rates would go up by only 0.3 point from 2021 — the standard rate would become 8.3 percent — because of reallocations of existing revenue flows from VAT.
A 2014 OECD survey found Switzerland, where workers earned over $91,000 on average, spends a relatively low 6.6 percent of economic output on public pensions. Life expectancy at birth was 82.5 years. More than 18 percent of the population was older than 65.
In a separate referendum, voters were set to approve a constitutional amendment that underscores the general thrust of current agriculture policy and sets out how to guarantee that the population will have proper food supplies in the long term.
($1 = 0.9690 Swiss francs)
Editing by Toby Chopra