July 3, 2019 / 1:01 PM / a year ago

Swiss propose raising retirement age for women to 65

ZURICH, July 3 (Reuters) - The Swiss government proposed gradually raising the retirement age for women by a year to 65, the second time it has tried such a measure as it seeks to shore up the wealthy nation's state pension system as a wave of Baby Boomers stops working.

The package unveiled on Wednesday also envisages raising value-added tax rates by as much as 0.7 percentage points to help finance the pension system. The package provides more revenue and cost cuts amounting to 2.8 billion Swiss francs ($2.85 billion) in relief to the pension system by 2030.

Voters in 2017 rejected raising women's retirement age from the current 64, scuppering the first serious reform of the pension system in two decades despite warnings that old-age benefits were increasingly at risk as life expectancy rises and interest rates remain exceptionally low, cutting investment yields.

In a framework whose details still need to be refined, the cabinet on Wednesday decided women's official retirement age should rise by three months a year to 65, the same as for men now. Over a nine-year transitional period, women with low to middle incomes would get special financial support.

It would let people choose when to start drawing retirement income from age 62 to 70.

The package needs to go to parliament and could again face voters under the Swiss system of direct democracy that gives the people a final say on all important issues. ($1 = 0.9839 Swiss francs) (Reporting by Michael Shields Editing by Frances Kerry)

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