Administering social security

From an organizational perspective, the AHV is a complex entity. It is a national institution and yet is managed by cantonal and sector-specific compensation funds. It is funded by a number of different sources: payroll contributions as well as federal subsidies, value added tax revenues and finally alcohol, tobacco and casino duties. The structure of the AHV raises questions that can only be answered by considering its foundation history.

Disability insurance (IV) was introduced in 1960 after a brief period of preparation. A sustainable administrative structure had to be set up quickly. The new social security scheme solved the problem by making use of existing schemes. Fundamental reorganization followed at the beginning of the 1990s. The autonomy and clout of IV institutions have since been consolidated.

Neither the AHV nor the IV provided subsistence-level pensions when they were set up. In 1965, Parliament therefore decided to introduce supplementary benefits. Although they were only intended as a transitional solution, they soon became an established part of the Swiss welfare state.

The Swiss healthcare system is organizationally complex. Private actors, including health insurance funds, hospitals and medical associations, play major roles. Federalism also influences administration, as the cantons have extensive powers. Since the 1990s, the national government has been trying to standardize regulations and to institutionalize cost-saving incentives.

Compulsory unemployment insurance came into force in 1977. The organization of unemployment insurance largely relies on existing institutions, with unemployment insurers and employment offices playing a central role. The Federal Office for Industry, Trade, and Labor, was long responsible for overseeing the various public and private institutions.

The income compensation scheme (EO) for soldiers (since 1940) and in the event of maternity (since 2004) compensates for a portion of lost income during military service and after childbirth. In 1947, the EO also served as a model for the introduction of old age and survivors’ insurance.