Unemployment insurance to receive less money temporarily
Published: Friday, Mar 1st 2024, 12:30
Updated At: Friday, Mar 1st 2024, 12:30
Volver a Live Feed
The federal government is to invest CHF 1.25 billion less in unemployment insurance over the next five years. This was decided by the Federal Council on Friday. Unlike planned, however, it has decided not to lower the cantons' share of direct federal tax.
This is shown in the dispatch on the Federal Act on Measures to Ease the Financial and Administrative Burden from 2025, which the Federal Council has adopted. Parliament will decide on this.
Last summer, the Federal Council announced various measures to ease the burden on the ailing federal budget. One of these is now to be implemented.
No loss of performance
The federal contribution to unemployment insurance (ALV) is to be reduced by CHF 250 million per year for a limited period of five years. According to the Federal Council, this reduction in the years 2025 to 2029 can be implemented without any adjustments to benefits because ALV has sufficient equity capital.
This good financial situation is due to the support provided to the ALV during the Covid pandemic in the form of extraordinary federal contributions amounting to CHF 16 billion. Despite a significant increase in short-time work compensation, it did not have to go into debt thanks to the federal contributions and was therefore also able to prevent an increase in ALV contribution rates.
If the good labor market situation continues, the ALV fund's equity capital will continue to grow in the coming years despite cuts in federal contributions, as the Federal Council states. Should the labor market situation deteriorate significantly, a valve clause will prevent the ALV from getting into financial difficulties.
According to the Federal Council's draft, the Federal Council and Parliament should be able to freely distribute the total reduction of CHF 1.25 billion over the years 2025-2029. For the 2025 budget, the Federal Council envisages a complete reduction in the federal contribution to unemployment insurance. This would reduce the federal budget by just under CHF 600 million in 2025.
Unclear daycare funding
However, the government does not want to reduce the cantonal share of direct federal tax. The reason for this is that parliament is pursuing a new approach to daycare funding, which would result in significantly lower costs for the federal government, writes the Federal Council.
"It is therefore no longer expedient to propose a reduction in the cantonal share in a separate bill." However, the Federal Council maintains that any proposal for supplementary childcare must be financed primarily by the cantons and/or the economy.
A consultation is currently underway on the issue of future daycare funding. The responsible Council of States committee is proposing a financing system in the Family Allowances Act based on employer and possibly employee contributions.
Construction sites for federal finances
The federal budget is in a structural imbalance: expenditure is growing faster than income. In addition to the rapid increase in military spending, expenditure on the AHV and healthcare, for example, will continue to grow strongly due to demographic trends.
In addition to the ALV cuts, the Federal Council has decided on further measures in recent weeks to eliminate the structural deficits. It did this within its own area of competence - i.e. without the need for legislation.
This involves, for example, linear cuts in practically all areas of expenditure. These measures will relieve the budget by around CHF 2 billion per year from 2024, with some of the relief measures being time-limited. Parliament will decide on this during the annual budget debate in the winter session.
During the current legislative period, the Federal Council will submit a further proposal to Parliament for the sustainable stabilization of federal finances based on a comprehensive review of tasks and subsidies. This was announced by Finance Minister Karin Keller-Sutter at the beginning of the year.
©Keystone/SDA
Spanish 
English 
German 
French 
Arabic