[JURIST] Switzerland took part in a national referendum on Sunday in which 53 percent of voters rejected a pension reform plan known as Pension Reform 2020 [background].
The plan set out to secure retirement benefits for Switzerland's aging population. The proposed reform addressed pension concerns caused by baby boomers nearing retirement age and life expectancy reaching an all-time high of 83.
Those who were in favor of the plan say the existing structure is unable to make annual payments from the AHV/AVS (social security retirement), as annual contributions are lower than payout demands. Among other changes, the reform would have increased employer and employee AHV/AVS contribution rates by .15 percent of pay, increased the retirement age for women from 64 to 65, and increased the value-added tax (VAT) from eight to 8.3 percent.
Pension Reform 2020 was approved by Parliament [official website] in March, but because reform included an increase in the VAT, it needed "double approval" to pass. This includes majority support among voters and majority support in more than half of the country's 26 cantons.