Pension payments could become compulsory for self-employed in Switzerland

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Switzerland’s Federal Council is looking at a proposal to make pension payments compulsory for self-employed workers in the same way that they are for salaried workers.

In Switzerland there are three elements to pensions. A universal state pension, funded from social security payments, a second element, known as a second pillar, which is a pot built up from sums deducted from salary, and a third pillar, which is an optional tax deductible amount granted annually.

Currently the self-employed are not required to pay into a second pillar fund. Some in government are concerned that this group is not saving enough and risks needing government aid in retirement.

On Thursday, with the support of the Federal Council, parliament voted in favour of looking at the issue.

The Swiss People’s Party (UDC/SVP) is against the idea, saying that self-employed pensions must continue to be governed by the principle of individual responsibility.

Federal Councillor  Alain Berset, said it is ultimately up to parliament to decide rather than the Federal Council.

About Investec

Investec is a distinctive Specialist Bank and Asset Manager. We provide a diverse range of financial products and services to a niche client base in three principal markets, the United Kingdom, South Africa and Australia, as well as certain other geographies. Investec’s strategic goals are motivated by the desire to develop an efficient and integrated business on an international scale through the active pursuit of clearly established core competencies in the group’s principal business areas.

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