Parliament blocks extra funds for state pension scheme

The failure of the two houses of parliament to agree on next year’s federal budget will result in hundreds of millions of francs going to pay off the country’s debt rather than fund pension provision.

Parliament blocks extra funds for state pension scheme
File photo: AFP/Fabrice Coffrini

On Thursday the smaller chamber of parliament, the Senate, rejected a budget compromise drawn up by a conciliation committee that would have seen 370 million francs flow into the state social insurance scheme (AVS/AHV).

The decision of the Senate to reject the compromise means the funds will instead be spent on debt repayment, according to news reports.

The money became available following the people’s rejection of a pension reform in a nationwide vote at the end of September.

The reform package was aimed at securing the state pension scheme which is set to face a huge deficit due to the ageing population.

Politicians from the centre-right parties joined forces on Thursday to defeat the compromise budget motion.

The move was a “placebo measure” without a legal basis, according to Liberal Radical parliamentarian Philipp Müller.

“I want a speedy solution for pension plans but one that is sustainable,” said Erich Ettlin of the Christian Democrats.

Next year’s budget additionally foresees a 41 million franc reduction in social assistance for asylum seekers.

The Senate also rejected extra money to beef up the Swiss border guard.