Mounting battle against cuts in social benefits

A wall with more than 140,000 signatures against cuts in social security benefits Keystone

Trade unions and centre-left parties have launched a campaign against unemployment insurance reforms as part of their policy to highlight social security issues.

Voters will have the final say in September on a legal amendment approved by parliament and designed at resetting the balance of the insurance scheme by reducing its debts.

It was a colourful group with flags, balloons and banners who handed the cardboard boxes with the necessary signatures for a nationwide vote to the federal chancellery before the summer break.

The campaigners said about 140,000 people – nearly three times the number required – had put their names down.

Renzo Ambrosetti of the Unia trade union group, one of the driving forces behind the referendum, was confident of a positive outcome.

“The number of signatures collected is a clear sign that the issue is very much on people’s minds,” he said.

Margret Kiener Nellen, a parliamentarian for the Social Democrats, added that the referendum was “another important step in the fight for social justice”.

Social agenda

The centre-left won an overwhelming victory at the polls when it challenged planned cuts of the occupational pension benefits earlier this year.

A third ballot on social security is already lined up for November, when voters will decide on an initiative by the Social Democrats to do away with tax breaks for the wealthy.

The handing in marked the end of the collection of the necessary signatures and, at the same time, the start of a public movement to win support among voters.

It left little doubt that criticism of the excessive manager salaries and top earners in general will be the main focus of the campaign.

“People don’t understand why such spongers are spared while the average citizen is being punished,” Ambrosetti said.

Kiener stressed that the proposed reform was “not only wrong, it is also dangerous. It reduces the purchasing power and destroys social security at a time when people need it most”.

Opponents are said to be spending about SFr600,000 ($570,000) on their campaign.

Consequences

Other parties appear to be unfazed so far. They recommend approval of the reform.

“The reform does not undermine the excellent basic benefits of the unemployment scheme. The planned overhaul is a balanced combination of additional revenue and spending cuts,” a statement by a committee of centre-right parties said.

Rejection would have serious consequences, especially for people with low and average income and for families, it warned.

The business world – the influential association of small and medium-sized enterprises and the employers’ association – said the reform was acceptable.

They said it would be irresponsible to increase contributions of the jobless insurance scheme without cutting benefits.

Still, the centre-left is confident it can convince voters and post a second victory at the polls in September.

Government

Cued up to counter the arguments of the opponents, the State Secretariat for Economic Affairs (Seco) has presented its case.

“Switzerland has a very solid unemployment insurance and we are in the top half in a European comparison,” said Seco’s Serge Gaillard.

He underlined that the Swiss system is generous but rigid and that an above-average amount of money is spent on counselling a jobless person to achieve a swift re-integration into the job market.

Gaillard, a former trade union representative, appears to downplay the impact of the planned cuts.

“We were looking for ways to save money which do not hurt too much and do away with disincentives,” he said.

The government’s message to voters is that basic benefits are not at risk and that it is time to act to reset the balance of the insurance scheme.

Urs Geiser, swissinfo.ch

Unemployment insurance

The state-run insurance scheme is funded by contributions from employees, employers and from the state.

It became mandatory for all gainfully employed people in 1977. Self-employed are not entitled to any services.

The law has been amended four times since 1984. Eight years ago the unions failed to win a referendum on the issue.

144,473 people (3.7% of the working population) were registered as unemployed at the end of June, according to official figures. The ten-year average rate is 3%.

Reform

In March parliament approved a plan aimed at cutting benefits of the insurance while increasing funding to reduce the scheme’s debts of about SFr7 billion (end of June 2010).

Centre-right parties and the government have come out in favour of the overhaul, while the rightwing has given its conditional approval.

However, centre-left parties and unions collected enough signatures to challenge the law to a nationwide vote set for September 26.

The aim is to increase revenue by SFr486 million, while SFr622 million will be saved through cuts in benefits.

Under the plan, benefits for those under 25 will be halved to 200 days. Those under 30 would be required to accept lower-paid job offers.

Those aged 55 and over will qualify for the maximum number of daily allowances only if they have paid contributions for a minimum of 22 months instead of the current 18 months.

The waiting periods for eligibility will be generally extended.

The regular contributions by employers and employees to the insurance scheme will be raised by 0.1% of the salaries each to 2.2%.