Compenswiss achieved a good return on investment in 2023. The substantial financial cushion is likely to attract a fair amount of attention in connection with the popular vote on the OASI on March 3.

Compenswiss manages the compensation funds for the old-age and survivors' insurance (OASI), the invalidity insurance (IV) and the loss of earnings compensation scheme (EO). Despite geopolitical and financial turbulences, the federal agency closed 2023 in the black and achieved a return on investment of 4.98 percent. In the previous year, it showed a loss of almost 13 percent.

Assets under management amounted to 40.6 billion Swiss francs at year-end. That is 3 billion Swiss francs more than at the end of 2022, as stated in a communication issued on Wednesday. Liquid assets amounted to 2.9 billion Swiss francs (previous year: 2.7 billion Swiss francs). Total operating and asset management costs amounted to 0.19 percent of total assets, a slight drop of 0.2 percent compared to the year before.

Benefiting from the year-end stock markets rally

The fund benefited from the positive development of equity and bond positions denominated in Swiss francs, according to the press release. In October, the performance was said to be still negative. It was only towards the end of the year that most asset classes recovered significantly.

The task of Compenswiss is to guarantee liquidity for the payment of pensions at all times. In addition, the compensation fund must invest its assets in ways which insure the best possible balance between security and returns in line with the market.

Improved financial situation

The tax reform and the increase in the retirement age for women have improved the financial situation of the compensation fund, the statement continues. "Swiss voters approved the Federal Act on Tax Reform and OASI Financing (STAF) in May 2019 and the OASI 21 reform in September 2022. With the additional income resulting from these two popular votes, the financial stability of the OASI will be assured for another six to seven years."

The operating results of the three social insurance funds will be released in April 2024.

Grist to the mill for proponents of the 13th OASI pension payment

The good result of the compensation fund is likely to be welcomed by the proponents of a 13th month OASI pension payment as confirmation that Switzerland could well afford a pension increase. On March 3rd the electorate will vote on the draft bill and the pension initiative.