Finances in deep red: the Federal Council expects an even larger deficit worth billions in the medium term

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Billions in deficits are expected from 2025, which will only increase over the years, writes the Ministry of Finance of Federal Councilor Karin Keller-Sutter (59).

This has consequences: the Federal Council as a whole will have to postpone a number of projects or approach them more slowly than previously planned, according to a press release. This has consequences for real estate projects where no construction work takes place. These should be postponed. “In addition, projects or campaigns in various departments have to be adjusted or postponed.” For example, the creation of a gas supply law, the development of new communication for emergency services organizations or prevention campaigns for equality or in federal asylum centers.

These are the reasons

On the expenditure side, the ongoing war in Ukraine is also leading to a short-term increase in expenditure in the asylum sector – namely the extension of S protection status. And because health care costs are skyrocketing, more money is needed to lower premiums. In the medium term, the AHV also needs more money because we are getting older. In addition, there is vastly increased military spending that Parliament has called for. “The goal here is to find financing solutions,” the press release said.

As for revenues, there is a mixed picture. Thanks to the introduction of the OECD minimum tax, revenues are likely to develop slightly faster than economic growth in 2027, but less strongly than planned in the financial plan. And even after that, expected revenues will grow less than expected. The slower growth of “consumption-related taxes and levies or stamp duties” is the cause of this.

Check higher AHV payroll deductions

Keller-Sutter’s finance department makes it clear: “Expenses are growing faster than revenues, which does not allow for the long-term debt brake.” An appeal is now being made to Parliament. Budget adjustments will be the highest priority to secure funding for important federal tasks.

The adjustment must mainly take place on the expenditure side. That means: save even more. But income-related measures should also be examined for the AHV and the army, according to the Ministry of Finance. In the case of AHV, for example, this could mean higher wage deductions for employers and employees. (brother/SDA)

Source:Blick