Swiss budget deficit for 2023 looks less drastic than expected

Just a couple of billion away from being balanced: the Swiss federal buildings in Bern. © Keystone / Anthony Anex

The government has narrowed its projected deficit for 2023 to CHF1.5 billion ($1.71 billion) after – among other things – scrapping a CHF4 billion rescue mechanism for the electricity industry from spending estimates.

The government had said in June it expected a deficit of CHF4.8 billion for 2023 and CHF6.7 billion for 2024, largely due to extraordinary spending on Ukrainian refugees and the electricity sector.

On Wednesday, it cutExternal link its estimate for extraordinary expenditures by CHF4.5 billion, notably saying that a rescue mechanism for the electricity industry would “not be needed as things currently stand”.

+ Read more: How the Swiss economy is faring up in 2023

It also cut its budgeted welfare spending on Ukrainian refugees by more than a third, saying it now expected some 66,000 arrivals from Ukraine for the year, down from the 100,000 accounted for in its budget.

Other boosts to the public coffers include the gradual selling off of the Ruag defence contractor and a CHF61 million windfall due to risk premiums linked to state backing for the UBS takeover of Credit Suisse.

However, the government said, due to there being no profit redistribution by the Swiss National Bank – which made record losses of CHF132 billion last year – a CHF2 billion drop in receipts was recorded by the federal authorities.

+ Read more: lower receipts means spending cuts