Too centralist – too statist: Why the AHV failed at the Polls

The first bill for a modest pension scheme drafted by Federal Councillor Edmund Schulthess’, was defeated at the ballot in 1931. In response, the authorities put off any further attempts at a state pension scheme for the time being.

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On 6th December 1931, 60 percent of voters rejected the first AHV bill, which would have implemented the old age and survivors’ insurance that had been approved in principle in 1925. The highbrow Neue Zürcher Zeitung referred to the outcome as a ‘catastrophic defeat’ for the welfare state. Indeed, the rejected bill was rather modest in scope. It aimed to achieve merely a ‘minimum level of welfare’ – as the Federal Council put it. It stipulated mandatory insurance, standard pensions (200 francs per year upon reaching 66 years of age) and allowances for those in need. The contribution-based funding system was based on percentages of wages as well as duties on alcohol and tobacco. A decentralized structure comprising cantonal insurance funds was planned for the necessary organization. Under the bill, the cantons would have been authorized to set up supplementary insurance, provided there was no conflict with private occupational pension schemes. By 1931, five cantons already offered modest old age benefits.

Despite criticism from the Social Democratic Party concerning the minimal social welfare included in the bill and the rather cautious attitude prevalent in industry, the bill garnered the approval of all major parties and associations. However, the looming global economic crisis proved expedient for the opponents of the AHV who pushed anticentralist and antimodernist views. Just like in the rejection of Lex Forrer (1900), opponents of the bill formed a highly heterogeneous coalition: liberal conservatives from western Switzerland and representatives of the agricultural community stood against impending ‘statism’ and purportedly excessive insurance contributions, while Catholic conservatives considered state insurance a threat to individual responsibility and private welfare. Shortly before the vote, the referendum committee presented a welfare initiative that proposed an alternative to the AHV based on means tests. As a result of the defeated AHV bill, poverty relief remained a matter of municipal welfare until after the Second World War, except for cases covered by private or cantonal insurance.

Literatur / Bibliographie / Bibliografia / References: Leimgruber Matthieu (2008), Solidarity without the state? Business and the shaping of the Swiss welfare state, 1890–2000, Cambridge; Lengwiler Martin (2003), Das Drei-Säulen-Konzept und seine Grenzen: private und berufliche Altersvorsorge in der Schweiz im 20. Jahrhundert, Zeitschrift für Unternehmensgeschichte, 48, 29–47.