Disabled face benefit cuts

The blind are among those who will be affected Keystone

Voters have approved a cost-cutting reform of the state disability insurance scheme which has notched up huge debts over the past decade.

The proposed changes won the support of nearly 60 per cent of the electorate, according to final results. There were regional differences between the German- and French-speaking parts of the country.

The reform foresees annual spending cuts of around SFr500 million ($402 million) in the long term and a 20 per cent reduction in the number of new beneficiaries every year.

Supporters, including the main centre-right and rightwing political parties, as well as the government and employers’ organisations, say cuts are needed to save the social security system from financial ruin.

They say the top priority is to promote the reintegration of claimants into the job market by improving measures to prevent them dropping out in the first place and being quicker to provide support to those diagnosed unfit for work.

Parliament approved the reform last year, but two small groups representing the disabled challenged the amendments in a nationwide vote.

Opponents, mainly from centre-left parties and trade unions, argue the reform is at the expense of weaker members of society and burdens the welfare system with additional cases.

They also say the plan fails to give an incentive to employers, or to put pressure on them to hire disabled people.

In the red

The number of people receiving benefits increased to 256,300 last year, from 173,216 in 1997.

The insurance scheme has accumulated debts of SFr9 billion. It dropped into the red in the 1990s as a result of a rise in cases of psychological disorders.

The campaign ahead of Sunday’s vote was marked by a series of controversial pictures and by claims of widespread abuse of Switzerland’s social security system.

The trade unions launched a set of postcards depicting some government ministers as physically disabled, prompting mixed reactions.

For its part, the rightwing Swiss People’s Party alleged that foreigners in particular were using disability payments as an easy way of tapping into the benefit system.

Initially political support for the small groups behind the referendum was limited and the Social Democrats’ grassroots had to force the party leadership to join the campaign.

The country’s two largest organisations for the disabled have refused to back the referendum, saying the reform is a step in the right direction despite certain shortcomings.

The vote comes as parliament is grappling with plans to shore up the funding for the insurance system, including a proposal to increase Value Added Tax.

The scheme is financed by a 1.4 per cent deduction from salaries, with the federal authorities providing additional funding.

swissinfo, Urs Geiser

Key facts

Yes: 59.1%
No: 40.9%
Turnout: 35.8%

In brief

The number of beneficiaries increased to 256,300 last year from 173,216 in 1997. 3.2% of the total population claimed disability benefits in 1990, the figure rose to 5.3% in 2005.

The percentage of claimants unfit for work for psychological reasons increased to 37.5% from 28% in the same period.

The disability insurance scheme, which was set up in 1960 and is administered by the state old age pension scheme, made a deficit of SFr1.6 billion and accumulated debts of SFr9 billion last year.

For the first time in the history of the insurance system the number of new beneficiaries dropped in 2006, partly as a result of stricter checks introduced in 2004.