Social security system

The social security system provides an income if employment or one’s personal situation does not enable this. There are various schemes (such as social insurances or means-tested benefits) and various administrative levels (federal, cantonal and communal) at the origin of these benefits.

Social protection funding

The total social security accounts show expenditure on social protection in Switzerland compared with the country’s overall growth, the source of receipts and the financial weight of each social risk.

Between 1996 and 2021, revenue from social security rose from CHF 128.1 billion to CHF 250.4 billion (at 2020 prices), an increase of CHF 122.3 billion. Given the country's economic growth, the increase in social security revenue is less significant: from 28.1% of GDP in 1996 to 33.9% of GDP in 2021.

These additional resources are mainly made up of social contributions from protected persons, excluding health insurance premiums (CHF +31.3 billion), employers' social contributions (CHF +30.1 billion) and public contributions from the Confederation (CHF +21.1 billion). Over these twenty-five years, the cantons' contribution increased by CHF 19.7 billion: most of this additional amount was earmarked to finance the healthcare system (CHF +9.3 billion), reduce health insurance premiums (CHF +2.4 billion francs), for homes for the disabled (CHF +2.3 billion) and, to a lesser extent, financial assistance (including social welfare, CHF +1.9 billion).

Between 1996 and 2021, health insurance premiums rose by 158.0%, from CHF 10.6 billion to CHF 27.4 billion, while property income fluctuated between CHF 18.4 billion and CHF 26.8 billion.

Between 1996 and 2021, expenditure on social benefits rose from CHF 96.2 billion to CHF 205.9 billion (at 2020 prices), an increase of CHF 109.7 billion. Given the country's economic growth, the increase in social expenditure appears less marked: from 21.1% of GDP in 1996 to 27.9% of GDP in 2021.

The area of old age (CHF +45.9 billion) contributed the most to this increase: old-age pensions from the occupational pension plan and OASI increased by CHF 24.8 billion and CHF 19.3 billion respectively. Sickness / health care also saw an increase with an additional CHF 39.4 billion, including CHF 19.5 billion from health insurance. An ageing population is behind this: the share of the population aged over 65 rose from 14.9% to 19.0% between 1996 and 2021.

The remaining social domains made a smaller contribution to the increase in social expenditure. For example, invalidity expenditure increased by CHF 6.1 billion and expenditure on families / children grew by CHF 4.7 billion. Expenditure on economic social assistance rose from CHF 1.0 billion to CHF 2.8 billion.

Means-tested social benefits for poverty reduction

Means-tested benefits prior to social assistance (also called financial social assistance) are paid by the cantons and reduce social assistance costs by targeting particular risks. They include supplementary benefits to OASI/IV, old-age and disability support, unemployment support, family support, maintenance advances and housing benefits. Financial social assistance is paid by the cantons or communes and serves as the last safety net of the social security system. Together, means-tested benefits and social assistance form the group of means-tested social benefits for poverty reduction.

From 2006 to 2021, net expenditure (gross expenditure minus reimbursements) of means-tested social benefits for poverty reduction increased in nominal value from 5.5 to 8.8 billion, which equates to a rise of 59%. During the observed period, this expenditure never decreased. The lowest rate of annual increase was 0.7% (2021) and the highest 6.1% (2012). In 2021, the cantons assumed 44.1% of means-tested social benefits for poverty reduction, while the communes and the Confederation assumed 35% and 20.2% respectively.

Between 2006 and 2021, the number of beneficiaries of means-tested social benefits for poverty reduction increased by 22%. Due to the increase in population numbers, the rate of recipients of these benefits increased less strongly from 8.9% in 2006 to 9.3% in 2021.

In 2021, 48.6% of recipients of means-tested social benefits for poverty reduction received federal supplementary benefits to OASI and IV (PC), representing 62.1% of expenditure (CHF 5.4 billion). This was followed by social assistance in the narrow sense with 33.1% of recipients and 31.5% of expenditure (CHF 2.8 billion). Other means-tested benefits accounted for a total of 18.3% of recipients and 6.4% of expenditure (CHF 0.6 billion).

Trajectories in the social security system

Between 2010 and 2021, the number of persons receiving benefits in the form of invalidity insurance pensions (II), daily unemployment insurance allowances (UI) or social assistance (SA) was around 700 000. Annual variations are largely due to fluctuations in the number of persons receiving daily unemployment insurance allowances, which depend on the economic cycle.

The number of persons receiving more than one benefit fell between 2010 and 2021, with the biggest decrease seen in the category of persons receiving daily unemployment insurance allowances and social assistance in the same year (-33.0%). The category of persons receiving unemployment insurance and invalidity insurance pensions in the same year decreased by 25.3% between 2010 and 2020, and increased by 20.6% between 2020 and 2021. Only the category of persons receiving social assistance and an invalidity insurance pension in the same year saw an increase between 2010 and 2021 (+13.9%).

Further information

Graphs

Related topics

Recipients of social benefits
Expenditure for means-tested social benefits
Total social security accounts

 

Statistical sources and concepts

Surveys

Definitions