Mitigation credits

With effect from 1 January 2019, the conversion rates were reduced. The conversion rates are now calculated using the 2015 generation tables and a technical interest rate of 1.5%.

For insureds born in the years 1954-1969, the Pension Fund Board has decided to increase the retirement savings capital in the Pension Plan so as to mitigate the effects of the lower conversion rates.

This mitigation will be financed by means of a one-time voluntary contribution by the employer in the amount of CHF 70 million.

The entitlement to monthly credits applies to active and disabled insureds born in the years 1954-1969 who are insured by the Pension Fund as of 1 January 2019 and who joined the Pension Fund before 9 November 2017.

The monthly credits are calculated based on the year of birth according to the table below.

a)      Principles

  • The basis is the retirement savings capital in the Pension Plan as of 31 December 2018.

  • The calculation does not take into account buy-ins, entry contributions, repayments of early withdrawals for the purchase of residential property or transferred benefits from pension compensation in the event of divorce, where these occur after 9 November 2017.

b)      Procedure

  • Monthly credits applied to the savings capital
  • Monthly credits applied on the first of each month over the course of five years
  • The first credit is to be applied on 1 January 2019, and the last on 1 December 2023
  • For insureds aged 60 or older as of 1 January 2019
  • Conversion of the compensation into monthly credits up to the age of 65

c)      Special cases

  • Entitlement to any remaining credits expires when an insured leaves the Pension Fund.
  • In the event of unpaid leave, the entitlement continues to apply without change throughout the unpaid leave.
  • In the event of voluntary partial or full retirement before the normal retirement age of 65, the entitlement to any remaining credits expires on a pro rata basis (for early retirement) or entirely (for full retirement).
  • Any credits outstanding on early retirement at the employer's request are applied in full as a single credit in the last working month.
  • In the case of an insured's death or full disability after 1 January 2019 but before 31 December 2023, any remaining portion of the monthly credits will be applied in full as a single credit at the time of the insured event.
  • If an insured makes a withdrawal for the purchase of residential property or pays pension compensation in the event of divorce, the remaining credits will be reduced in proportion to the withdrawal from the Pension Plan.