For army chief Süssli, the army’s liquidity bottleneck is “no drama”
Published: Thursday, Feb 1st 2024, 19:01
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According to its head Thomas Süssli, the army does not have a billion-euro shortfall, but a liquidity bottleneck. This is "not a drama", but a problem that can be solved, said Süssli. Opponents of the army immediately called for investigations and the Officers' Association demanded more money.
According to a report by Swiss Radio and Television (SRF) on Wednesday, the Swiss Armed Forces will lack over one billion Swiss francs by the end of 2025 to pay for armaments purchases already made. On Thursday, Süssli therefore had to answer questions from the Security Policy Committee of the Council of States (SIK-S).
Süssli then put the initial situation into perspective. "No mistakes have been made," said Süssli. "We don't have a financial hole and we can pay all our bills." The situation is due to political decisions that he does not wish to comment on.
The army leadership is constantly analyzing the financial situation and therefore recently decided, for example, to cancel the major events "Air Spirit 24" and "Defense 25". The army wants to focus on its defense capabilities.
Payments postponed
The postponement of the increase in the army budget to one percent of gross domestic product (GDP) from 2030 to 2035 means that there is a lack of money for the modernization of the troops. The army had communicated transparently from March 2023 what the delay in the budget increase meant, said Süssli. Compared to the budget for 2023, when there was still a faster increase, the army was 11.7 billion Swiss francs short.
According to the head of the armed forces, the Swiss Armed Forces had outstanding financial obligations of around CHF 13 billion at the end of 2022. All payments have been secured for the current year. Obligations amounting to CHF 800 million would have to be postponed from 2024 to 2025.
In 2025 - due to the expected slightly higher budget - CHF 400 million would then have to be postponed to 2026 and in 2026 another CHF 200 million to 2027. Then the army will be able to invest in strengthening its defense capabilities again, said Süssli.
"Different situation than before"
Over the next few years, the army will have to negotiate with the manufacturers and suppliers of armaments as to how and when payments can be made, said Süssli. Delayed deliveries cannot be ruled out. The strengthening of the army's defense capability will be delayed by several years due to the delayed increase in the army budget.
According to the army chief, the liquidity bottlenecks are not a new phenomenon. There has long been a "financial mountain that is being pushed in front of us". The aim is for this mountain to get smaller and smaller. Parliament's financial decisions are decisive in this respect.
If military spending had already been increased to one percent of GDP by 2030, the "problem of liquidity management" would have been alleviated, as Süssli explained.
According to Süssli, it is clear that there will be gaps in the army because many systems are reaching the end of their lives at the same time. "This is a different situation than in the past." If nothing is done, the army will no longer have any operational tanks at the beginning of the 2030s, for example. The army has always communicated transparently to the parliamentary commissions and to Defense Minister Viola Amherd.
Armed Forces Dispatch in Commission in March
On Thursday, the Security Policy Committee of the Council of States (SIK-S) was briefed by Süssli and Defense Minister Viola Amherd on the army's financial situation. In March, it intends to address the question of how the Federal Council intends to expand the army's defense capabilities following the delayed budget increase.
In March, the Commission will discuss the 2024 Armed Forces Dispatch. Among other things, it will address the future capabilities of the army and the army's new expenditure ceiling for the period 2025 to 2028. In the SIK-S, a minority motion to carry out the air force's "Air Spirit 24" was rejected.
Opponents and critics of the army want to initiate comprehensive investigations. The Swiss Officers' Association, on the other hand, is calling for more funds for Switzerland's defense capability as quickly as possible. Defense Minister Viola Amherd declined to comment.
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