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This week, the referendum roster was announced for 3 March 2023. There will two votes on Switzerland’s state pension system. One aims to tackle the impending funding crisis by extending the retirement age, and the other aims to alleviate old age poverty by increasing payments without a plan to pay for it. Photo by Monica Silvestre on Pexels.comThe first would raise the retirement age by one year to 66 by 2032 and then link it to life expectancy beyond that date. If life expectancy rises...

This week, SRF held a discussion on poverty in Switzerland. Philipp Frei, Managing Director of the Swiss Budget Consulting Association, an organisation that helps people budget, voiced concern over shrinking disposable incomes. While economic historian Tobias Straumann spoke of the progress Switzerland has made on welfare and poverty’s often transient nature. Photo by Ahsanjaya on Pexels.comIn 2021, Switzerland’s poverty line was set at CHF 3,989 (US$ 4,650) a month for a family of four...

In Switzerland, the law allowed health insurance companies to pursue young people for unpaid insurance premiums when they turned 18. From 1 January 2024, this is no longer possible. These debts remain with the parents. If insurers want to collect the money they are owed they will now have to pursue parents. Photo by Mikhail Nilov on Pexels.comHowever, the law is not retroactive. This means it will only apply to young people turning 18 after 31 December 2023. The change has long had the...

On 1 January 2024, three new laws came into force. The first is a change to Swiss pensions. Under the new rules it will be easier to retire later or to continue working part time. Working for longer will mean a larger state pension when it is taken. The economic rationale is that more people working for longer will add to GDP and tax revenue, reduce the dependency ratio and help with the challenges of funding pensions as the population ages. © Chris Dorney | Dreamstime.comThe second...

In a recent poll, nearly 82% completely (46%) or somewhat (36%) agreed that the gap between rich and poor in Switzerland is increasing. However, these responses are at odds with typical measures of inequality. © Nora Tarvus | Dreamstime.comTwo key measures of inequality are the S80/S20 and the Gini Coefficient. On both measures Switzerland is fairly stable. The S80/S20 takes the average income of the top 20% and divides it by the average income of the bottom 20%. In Switzerland in 2021...

In 2022, 2.9% of the population received welfare, according to data published by the Federal Statistical Office (FSO) this week. Since 2005, when nationwide data on welfare was first collected, the rate has only dipped below 3% once before in 2008. The highest it has been was 3.3% in 2016 and 2017. © ochu2008 | Dreamstime.comWelfare does not include basic unemployment benefits, state pension payments or standard disability payments, which are Switzerland’s largest social transfers....

More than seven years after a slim majority (51.9%) of the UK electorate voted to leave the EU, Switzerland and the UK have agreed a deal that clears the way to more open cooperation in the financial services sector, helping to restore the pre-Brexit arrangement between the two nations. Photo by Pixabay on Pexels.comOn Thursday, Switzerland and the UK announced an agreement to improve trade in financial services between the two nations, reported RTS. Although Switzerland is not an EU...

On 14 December 2023, the Swiss National Bank (SNB) said it was ending its interest rate tightening cycle after a clear slowdown in inflation. © David Taljat | Dreamstime.comWith inflation rising more slowly than the central bank’s 2% ceiling (it was 1.4% in November 2023), the SNB left its key interest rate at 1.75% for a second consecutive meeting. While the SNB is still willing to intervene in currency markets by buying and selling Swiss francs, Jordan said that can go in both...

With all of the price hikes in Switzerland it is difficult to believe inflation is running at around 2% (it was 1.4% in November 2023). Health insurance premiums in 2024 are on average 8.7% higher than they were in 2023. Now Swiss car insurance is set to get more costly. The insurance advisor VZ predicts an average rise of 15% for vehicle insurance in 2024, reported RTS. Photo by Andrea Piacquadio on Pexels.comThe average expected rise is 15%. However, some premiums may rise by as much...

The previously announced half price plus rail pass, which has some of the features of an annual pass, will be available from mid-December 2023, reported Swiss Rail this week. © Tea | Dreamstime.comThe pass comes in three flavours: Half-Fare travelcard PLUS 1000, Half-Fare travelcard PLUS 2000 and Half-Fare travelcard PLUS 3000. They all work the same. You essentially buy a certain amount of ticket credit at a discount. So for example, someone under 25 would get CHF 1,000 credit at a price...