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Parliament votes to reform invalidity benefit

A long road ahead for reforming invalidity benefit

(Keystone)

The House of Representatives has accepted a plan aimed at reducing the number of appeals brought by unsuccessful applicants for invalidity benefit.

The move is part of measures aimed at curbing the spiralling cost of the invalidity benefit scheme, which currently has debts of SFr6 billion ($4.6 billion).

On Tuesday the House voted by 92 votes to 65 to make those whose appeals have failed pay their own legal costs - which could be between SFr200 and SFr1,000.

Appealing against a negative invalidity benefit decision currently incurs no cost.

The measure had strongest support from the political Right, which argued that it would stop the rise in appeals.

These numbered 12,000 in 2003, a third of which were later found to be unfounded, said parliamentarians. The number of appeals in 2005 is so far estimated at 19,000.

The motion was opposed by the political Left, which said that the move would not improve the current situation and that it would be better to revise the invalidity scheme as a whole.

Health Minister Pascal Couchepin said that he realised that the proposal was not "a miracle solution" but was a way of eliminating weaknesses from the invalidity benefit system.

Urgent need

All political groupings are agreed that Switzerland's invalidity benefit scheme is in urgent need of reform. Last year, the scheme had a deficit of SFr1.6 billion, and debts of over SFr6 billion. Future projections show costs continuing to spiral.

Previous attempts at reform have come to nothing. Last year, voters blocked government plans to raise more revenue for the scheme from increases in value-added tax (VAT), after the Right lined up against the proposal.

Some relief has been provided by the sale of National Bank gold, the proceeds of which – some SFr7 billion - will be used to prop up the state pension and the invalidity scheme.

Controversy over reforms has been high since Christoph Blocher, of the rightwing Swiss People's Party, blamed what he called "bogus invalids" for abusing the system, in a newspaper interview in 2003.

Blocked

His party has consistently blocked plans to fund the scheme with an increase in VAT, arguing that structural reforms are needed before more money is pumped into the system.

After voters turned down the VAT increase, the government changed tack and submitted a plan to cut the scheme's costs, along with an amended proposal to raise money.

The savings target is around SFr596 million per year, which would be achieved by introducing a more restrictive definition of invalidity.

Where revenue is concerned, the government wants to increase the proportion of people's salaries devoted to the scheme from 1.4 to 1.5 per cent, and to raise VAT by 0.8 per cent.

The debate over reform is destined to preoccupy parliament for several months. This is largely because discussion of the revenue question will have to wait until the government's cost cutting plan has been debated.

Voters will also be asked to decide on a plan by the centre-left Social Democrats, who want profits from the National Bank to be pumped into the state pension and invalidity schemes.

The formal revision of the appeals procedure was the first step before the House tackles the substance of the reform.

Legal arguments

The House's Public Health Committee has also revived a proposal discarded by the government, under which the Federal Insurance Court would only be able to consider legal arguments when deliberating on an appeal.

Though the changes may appear technical and formal, the revision seems likely to spark the first parliamentary battle over the reform of the invalidity scheme.

Already approved by a small majority at the committee stage, in full session it is bound to meet with strong opposition from the left and from parliamentarians closely linked with disabled persons' associations.

Opponents question the claim that the revision will simplify the appeals' procedure, and point out that the decision to abandon the "prior-investigation" procedure in 2003 was taken precisely with a view to standardising social insurance procedures.

The proposed measures would make appealing to the courts more difficult, without guaranteeing any real reduction in costs.

In addition, the idea of limiting the insurance court's competence to legal arguments only was rejected last year by the House, not least because disabled persons' associations had threatened to force a referendum against the change. Now their threats are again influencing the debate.

swissinfo, Andrea Tognina

Key facts

Last year the invalidity benefit scheme made a loss of SFr1.6 billion and had a total debt of SFr6 billion.
Between 1992 and 2004, the number of people claiming invalidity benefit rose from 3.2% to 5.2% of the working population.
Most claims relate to mental health problems, back pains and injuries.
The government wants to save SFr596 million a year by restricting access to benefits.

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