The Income Substitution Insurance for Militia Soldiers (EO) introduced in 1940 sought to support the families of soldiers in service; it played a key role in national social welfare policy during the Second World War and accounted for almost half of social insurance expenditure at the time (F2). The EO system and its equalization funds also served as a model and foundation for the introduction of old age and survivors’ insurance (AHV) in 1947. Although EO was a rather unimportant branch of social insurance during the Cold War from a quantitative standpoint, it was nonetheless of great importance for supporting the militia army.

The EO was subject to fundamental change after 1989, due largely to the radical downsizing of the Swiss army. In 1989, over 800,000 soldiers served in the army; this number fell to around 200,000 in 2010, meaning the total number of people entitled to EO benefits likewise diminished substantially (F15). The introduction of maternity compensation in 2004 represents another turning point. In 2011, women already accounted for a quarter of those entitled to EO benefits. Maternity compensation benefits amounted to almost half the total expenditure of this branch of social insurance (F16). Maternity benefits even surpassed those paid to servicemen after 2011. EO benefits in connection with civilian service (a recent alternative to military service) have likewise been on the rise since the mid-2000s.

Figures

F2 Expenditures of key social insurance programs as a percentage of gross domestic product, 1925-2010

F15 Recipients of income substitution insurance (EO) benefits, 1991-2011 

F16 Income substitution insurance (EO) benefits in million francs, 1991-2011

(12/2015)