Where in Illinois would you retire


The Swiss government plans to raise the retirement age for women by one year to bring it in line with that of men. Most industrialized countries have adopted similar reforms, but the issue is politically sensitive.

This content was published on March 16, 2021 - 4:00 p.m.

My specialty is telling stories; to decipher what is happening in Switzerland and around the world with the help of data and statistics. I have been living in Switzerland as an expat for several years and previously worked as a multimedia journalist for Radio Télévision Suisse (RTS).

More about the author | French-speaking editorial team

Norway and Iceland's new retirees are the oldest in the developed economies. In the two Nordic countries you have to work until you are 67 years old to receive a full pension. Their legislation, which was introduced in the second half of the 2000s, does not provide for different retirement ages for men and women.

In contrast to Switzerland, where women can retire at the age of 64, while men can only retire at the age of 65. The Swiss government has long wanted to eliminate this gender gap and align the reference age. The Organization for Economic Cooperation and Development (OECD) also advocates this.

On Monday, March 15, the Council of States passed the draft of the AHV reform with this in mind. The need for reform was undisputed, but there was still a lot to be discussed.

The goal: to balance the finances of the AHV

Old-age and survivors' insurance (AHV) is the first of the "three pillars" of the Swiss pension system. This is intended to guarantee a minimum standard of living for all pensioners who live or have worked in Switzerland. However, the AHV bill, which is financed by the pay-as-you-go system, has been deteriorating for several years. A phenomenon that is likely to worsen in the coming years with the retirement of the "baby boomers". The Federal Social Insurance Office (FSIO) predicts that the OASI debt will exceed CHF 23 billion in ten years if no measures are taken.

To remedy this situation, the reform project known as "AHV 21" primarily provides for an increase in VAT and an increase in the retirement age for women to 65 years, accompanied by compensation. With this measure, the government hopes to save a total of CHF 10 billion between 2023 and 2031.

End of insertion

On the way to retirement age 66

The retirement age of Swiss women is currently slightly above the OECD averageExterner Link, which in 2018 was 63.5 years for women and just over 64 years for men. (The actual departure from the labor market does not necessarily have to correspond to this. In Switzerland, it takes place a little later on average, at 65 years for women and 66.5 years for men).

In recent years, however, the aging of the population and rising deficits have led most governments to decide to increase the retirement age, often against strong opposition.

External content

The financial pressure was felt earlier and more strongly in fully pay-as-you-go systems, which are more exposed to demographic changes, than in a mixed system such as in Switzerland - where only the first pillar is pay-as-you-go and the other two are funded.

Depending on the national characteristics, the reforms carried out are more or less progressive and far-reaching. For example, the OECD points out that the retirement age in Denmark and the Netherlands could at some point be raised to over 70 for both sexes. The average age in the member states will gradually increase to 65.7 years for women and 66.1 years for men by 2060. If the "AHV 21" project is accepted, Switzerland will still be slightly below this level.

External content

Age differences will disappear

The trend suggests that the gender gap is gradually being eliminated in most countries. Today the retirement age is lower for women in 19 OECD and G20 countries.

External content

As things stand at present, this will only continue to be the case in five of the 30 OECD countries, including Switzerland. In other countries such as Argentina, Russia, China and Brazil, a gap of five years remains, in Romania it is reduced to two years.

The liberal think tank Avenir Suisse has identified two methodsExternal Link how countries are raising the retirement age. Some governments are beginning to harmonize the retirement age for women to that of men - as provided for in "AHV 21" - and then extend the age for the entire population. Countries such as Australia, Austria, Belgium and the United Kingdom have chosen this route.

The second approach is to set the same higher target age for both sexes from the outset; the effort to achieve this is then greater for women. For example, in Italy women retired at 60 and men at 65 before the decision was taken to raise the retirement age to 67 for everyone in 2019. In the longer term, Italians will retire at the age of 71.

A "patriarchal" system?

According to Jérôme Cosandey, Head of Western Switzerland and Social Policy Research at Avenir Suisse, this international comparison not only shows that the Swiss reform project is "not very ambitious", but also speaks in favor of harmonizing the retirement age.

"The four other OECD countries that have not yet done so - Poland, Hungary, Israel and Turkey - are not really models for gender equality," he told swissinfo.ch.

The political debate in Switzerland revolves around the question of whether a reform that affects only half of the population is fair. The pension expert says that the introduction of a differentiated retirement age is itself the result of a "very patriarchal" system.

When the AHV was introduced in 1948, the retirement age for both sexes was 65 years. It was not until the 1957 and 1962 revisions - before the introduction of women's suffrage in 1971 - that the politicians decided to lower the retirement age for women to 63 and then to 62, says Cosandey.

There were several reasons for this, but "nasty tongues claim that men, who were usually older than their wives, didn't want to be alone in retirement," says Cosandey. He adds that the Federal Council's argument at the time was based on the assumption that "women are physiologically disadvantaged despite their higher life expectancy".

It was not until the last AHV revision in 1997 that it was decided to gradually raise the retirement age for women in Switzerland from 62 to 64 years, in return for improvements for them, explains the researcher.

The liberal says he is surprised that opponents of reform are "trying to defend a relic of a patriarchal world to justify the status quo".

Women get less when they retire

The rejection comes mainly from feminist circles, trade unions and the left political spectrum. For the Social Democratic Party, for example, reform is being carried out "on the backs of women". A petition supported by the trade unions and signed by more than 300,000 people was submitted to the Federal Chancellery in Bern on Monday.

"This bill is presented as a step towards equality, but equality must first be achieved in working life. We are still a long way from that," Michela Bovolenta, central secretary of the public service union (VPOD) and feminist activist, told swissinfo.ch . For them, on the contrary, such a measure would deepen the inequalities between women and men.

Lower salaries, more part-time work for women, more fragmented career paths, the “glass ceiling”, the unequal distribution of domestic tasks: “These are all inequalities that accumulate during working life and that still exist Pensions for women are much lower than for men, "says Michela Bovolenta.

This restricts the opportunities for women to pay into company (2nd pillar) and private (3rd pillar) old-age provision. Indeed, women are now severely overrepresented among the poor elderly.

Their pensions are 25% lower than those of men on average across OECDExterner Link - and in Switzerland they are even almost a third. This gap is "likely to remain large" in the future, but "improving the situation of women in the labor market will help to narrow it," the organization notes.

External content

Before considering raising the retirement age, the VPOD considers an increase in pensions to be a priority, as the current amounts in the first pillar alone do not enable a decent life in Switzerland. "Only a minority can afford a third pillar, which is financed by private savings, and more than 40% of new retirees do not even have a second pillar," says the union.

Jérôme Cosandey does not deny that women's pensions are lower overall, but stresses that the inequalities stem from the coverage of the 2nd pillar, not the 1st pillar, which is at the heart of the reform project. "The average pension in the AHV is almost the same for both sexes, with a slight disadvantage for men". For the Liberal, "two important but not directly related issues are mixed up".

Already rejected twice

The Federal Council says it is "sensitized to the question of wage inequality". But he also believes that this "must be addressed at the source, where it occurs", regardless of the question of the retirement age for women.

The government is walking on thin ice as it has failed twice with plans to raise the retirement age. A first attempt failed in parliament in 2011, a second ("retirement pension 2020") was rejected by referendum in 2017. Surveys showed that women were vehemently opposed to the request.

The parliamentary debates that began on Monday will define the accompanying compensatory and transitional measures of the reform project. The majority of the Council of States is in favor of a less generous formula than that proposed by the government. A bad idea to win a vote, Social Affairs Minister Alain Berset warned on Monday. The Social Democrat said the compensation was an integral part of the compromise and was proportionate.

"It will be an exercise in realpolitik," says Cosandey. It will be necessary to win over those directly affected - because in the system of direct democracy the people have the last word.