Information on the BVG reform

In Switzerland, pensions for retirement, disability and death are based on three pillars. The objective of the second pillar (BVG), together with the first pillar (AHV/IV), is to ensure a comfortable standard of living in retirement.  It aims to provide a pension income of around 60% of the last salary.  The Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans (BVG), which has been in force since 1985, provides the legal framework for the second pillar and defines minimum benefits. Pension funds usually offer further benefits over and above these minimum benefits.

Increased life expectancy has made it more difficult to finance the minimum benefits. This has led to an unplanned redistribution from the young to the old in the pension funds. In order to correct this, reforms for a healthy and sustainably financed occupational benefit plan are unavoidable. The pension funds themselves can regulate the area of further benefits, and this is generally done.

For the minimum benefits, however, an adjustment of the specifications and thus a change in the law is necessary. Politicians have long struggled to recognize this situation and find appropriate solutions.

Both the National Council and Council of States have now agreed on a reform proposal. Now that Parliament has passed the overdue and politically broadly supported reform, the electorate will vote on the bill this fall.

Objectives of the BVG reform:

1. Secure the financing of the minimum occupational pension provision by reducing the BVG conversion rate.

2. Build up more individual savings capital to compensate for the reduction in the conversion rate.

3. Modernize the minimum pension provision and develop it in particular for part-time employees and low-paid workers.

4. Ensure compensation measures for age groups approaching retirement.

The effects of the reform on PKL can be found under the following link:

Effects BVG reform