GENEVA - Swiss voters on Sunday rejected a divisive pension reform plan that the government said was vital to safeguard benefits, according to initial estimates. Figures released by the GfS Bern polling institute shortly after polling closed, showed that 53 percent of voters said no to changes to the current system which would have raised women's retirement age by a year to 65 as well as hiking VAT to help fund benefits.

Only 47 percent of voters cast ballots in favour of the reform, which was approved by parliament in April. Ahead of the vote, opinion polls suggested the result was too close to call, with the pro-reform side slipping marginally in recent weeks. With most voters casting their ballots by post, final results were due out later Sunday.

The government said the changes would help avoid deficits in a social security scheme facing pressure from an ageing population, with baby boomers entering retirement. Rising life expectancy, now 83 years, has added further strain.

But critics argued that the changes were too modest to rescue a retirement system in financial peril.

The vote is the latest in Switzerland's direct democracy system, which includes four referenda a year on major national issues.