2022: AVS 21 and the real conditions of retirement

Two votes with a shared condition

AVS 21 comprised a statutory amendment and a decree on additional funding. The amendment, challenged by referendum, needed a popular majority. The constitutional VAT decree also required a majority of cantons. Both had to pass for the reform to proceed.

The structure linked insurance resources with changes to benefits and timing without making the proposals identical. Tax distribution, changing the age and the value of partial pensions can be assessed separately. Understanding the legal connection does not replace debate over each social choice.

Acceptance did not immediately make every rule applicable. On 9 December 2022, the Federal Council set commencement for 1 January 2024 and opened implementation consultation. The new system was not operating at the September vote.

Reference age establishes an income benchmark

The reform proposed gradually raising women’s reference age from 64 to 65 by three months per year. This is the point of pension receipt without an early-claim reduction or deferral supplement. It does not guarantee a job until then or mean everyone actually remains in paid employment to that date.

A changed calendar has one effect for someone retaining sustainable work and another for someone unemployed, exhausted or responsible for unpaid care. Equal statutory ages do not establish equal careers or resources to reach them.

The project contained compensation for a transitional generation of nine birth cohorts: more favourable early-claim conditions or a supplement for women who did not claim early. These measures address proximity to retirement and existing life plans. They should be recognised without assuming they correct every inequality accumulated during working life.

A flexible pension needs adaptable work

A partial pension can facilitate gradual reduction in activity. Insurance timing and employment contracts do not automatically align. People must obtain reduced hours, retain work compatible with health and finance any remaining income gap.

Early claims provide income sooner with a reduction under applicable rules. Deferral provides a supplement but requires the ability to wait. These options do not carry equal value for someone with substantial savings and someone whose budget is tight. “Choice” must be tested against resources and working conditions.

Other retirement provision matters too. Possibilities depend on pension-fund rules and careers, including part-time work and periods without earnings. Useful information shows how benefits interact rather than treating a standard case as universal. This study does not calculate personal entitlements; it explains different effects of identical rules.

Examine insurance finances and living incomes together

Additional VAT provided revenue separate from payroll contributions. The June 2022 FSIO factsheet proposed raising the standard rate by 0.4 percentage points. Consumption taxation distributes effort differently from employment contributions. Assessment must consider household resources and the share spent.

Projections depend on employment, wages, demography and other assumptions. They assist decisions but do not make the future certain. An unconditional promise of balance until a particular year would conceal this dependence. Authorities should clarify assumptions and explain revisions.

Social assessment also asks whether pensions, with other resources, enable a dignified life. Better insurance accounts do not guarantee adequate income to every retired person. Conversely, benefit demands should identify financing. These requirements complement each other.

For the PCP, the assessment should encompass the journey to retirement as well as the payment date. Preventing employment exclusion, making later careers sustainable and ensuring sufficient incomes are public responsibilities. Flexibility is progress when it broadens possibilities; it remains incomplete if only people able to finance room for manoeuvre have real choice.