Reader question: Do I have to pay back social benefits in Switzerland?

According to Switzerland’s Federal Statistical Office, the total number of people receiving social assistance in 2021 was 307,391. Of that, 265,100 people living in Switzerland received financial social assistance on at least one occasion that year.

The office also stated that the main groups at risk have not changed much in recent years and still include individuals without post-compulsory education, children, foreign nationals, single-parent families, and people living alone have a higher risk of having to resort to social assistance.

Of those, Swiss nationals and foreign nationals with a permanent residence permit or an annual residence permit account for around three-quarters of social assistance recipients.

The remaining quarter is mainly made up of refugees, provisionally admitted persons or asylum seekers.

However, while re-entering the workforce after long-term unemployment is not easy, in Switzerland, it can also be very costly.

Some Swiss cantons will in fact make you repay the social assistance you have received while unemployed in its entirely once you’re back on the job market.

Switzerland’s social welfare system is regulated at cantonal level and rules vary from canton to canton. Some cantons only demand repayment if the recipient comes into a large amount of money through an inheritance, lottery win, or other means, or if the situation of financial hardship was the recipient’s own fault.

But others also demand repayment if the recipient’s economic situation improves due to earned income.

Though cantons are free to set their own rules, the Swiss conference for social welfare assistance (SKOS) recommends that cantons do not seek reimbursement from earned income alone. 

Where the cantons provide a legal basis for reimbursement from earned income, the SKOS guidelines recommend granting a generous income limit and limiting the duration of the reimbursement to a maximum of four years.

So, where will you have to pay back social assistance on earned income?

In Switzerland, a so-called repayment obligation applies across its 26 cantons, which means that recipients must pay back either the full or a partial amount of the social benefits they have received.

Though SKOS recommends that cantons do not seek reimbursement from earned income alone so as not to stand in the way of the individual becoming economically independent again, some cantons opt to ignore that recommendation.

According to SKOS monitoring report 2021, ten cantons require individuals to reimburse the funds received from their earned income, though only in exceptional cases. Those cantons calculate the claim in accordance with the recommendations of the SKOS.

Those ten cantons include Appenzell Ausserrhoden, Bern, Fribourg, Glarus, Jura, Lucerne, Obwalden, Solothurn, Zurich, and Zug.

In the cantons of Zurich and Zug, for instance, social benefits must be reimbursed if the supported person’s assets have not increased through their own work.

In those two cantons social benefits must only be repaid from wage income if the salary results in such favourable conditions that it would be inappropriate to forgo a refund.

Additionally, five cantons said they use their own calculation bases – some with lower income limits – while three other cantons did not provide any information on their repayment obligation regulations.

The cantons named in the report to rely on their own calculation bases are Aargau, Appenzell Innerrhoden, Basel-Country, Graubünden, Nidwalden, St. Gallen, Thurgau, and Valais.

Where will I not have to pay back social assistance on earned income?

According to the report, eight cantons do not require the reimbursement of lawfully received social assistance due to favourable circumstances based on earned income alone.

These cantons include Basel-City, Geneva, Neuchâtel, Schaffhausen, Schwyz, Ticino, Uri, and Vaud.

Basel-Country considers relaxed repayment conditions

In February, the canton of Basel-Country announced it is looking to loosen the requirements on the repayment obligation. Namely, earned income should no longer be used to pay back social security debts – as it still is the case in the canton currently. Instead, the reimbursement obligation should now only apply in the event of an accumulation of assets.

The canton’s Government Council has since submitted the corresponding proposal for the new regulation of the reimbursement obligation for social assistance benefits, which has entered a three-month consultation process.

An update is yet to be revealed, however, according to its website, benefits must still be repaid if the financial situation of the supported person has improved to the extent that this is reasonable. In order for such a situation to be accepted, there must be either excess income or assets.

Is there a statute of limitations on social assistance repayments?

Yes, though every canton sets their own regulations.

According to the report, ten cantons – or their municipalities – that require reimbursements from earned income gave very different answers when it comes to the statute of limitations on reimbursement rates.

Another eight cantons indicated that the repayment period should be more than four years.

In many cantons, the statute of limitations for the reimbursement of social assistance funds is between 10 and 15 years.