Second 2022 extrapolation confirms high financing deficit

26.10.2022

The Federal Council was informed about the current extrapolation on 26 October 2022. The Confederation is reckoning on a financing deficit of CHF 4.1 billion for this year. The deficit is due to high extraordinary expenditure, most of which was incurred to deal with the COVID-19 pandemic.

Based on the figures up to the end of September, the Confederation expects a financing deficit of CHF 4.1 billion for 2022 (June: -5.0 bn). This is due to high extraordinary expenditure of CHF 6.1 billion (June: 7.4 bn), incurred mainly in dealing with the COVID-19 pandemic.

In the extraordinary budget, the estimate for expenditure on short-time working compensation in particular is down at CHF 1.4 billion (June: 2.5 bn). The subsequent payment of holiday and public holiday short-time working compensation for employees on monthly wages is expected to be lower (1.0 bn vs. 2.1 bn in June and in the budget). So far, only a few businesses have submitted a corresponding application. Similarly, the hardship measures for businesses (0.5 bn vs. 0.6 bn in June) and social welfare lump sums paid to the cantons for people from Ukraine seeking protection (0.8 bn vs. 0.9 bn in June) are likely to be lower. During the autumn session, Parliament additionally approved the bailout loan of CHF 4.0 billion to secure the liquidity of Axpo Holding AG. It is assumed in the extrapolation that the loan will either not be drawn down or will be repaid in full and therefore will not burden the Confederation over time.

In the ordinary budget, the Confederation is reckoning on a financing surplus of CHF 0.4 billion (June: 0.7 bn). The estimate for both receipts and expenditure is slightly higher than in June (+0.1 bn and +0.4 bn, respectively). In the case of receipts, the stamp duty estimate has been revised upwards, and in the case of expenditure, supplementary credits in particular have turned out to be higher than had been expected in the summer.

The extrapolation is still associated with considerable uncertainty. In particular, it is difficult to forecast the actual amount of extraordinary expenditure.

Classification of the extrapolation

The Parliament Act stipulates that the Federal Council shall arrange for projections on the expected annual result to be issued as of June 30 and September 30 and shall notify Parliament thereof. The extrapolation is an estimate and thus has to be interpreted with caution. Like last year, the degree of uncertainty is particularly high and depends on how the pandemic and the war in Ukraine will evolve in the future.

Last modification 26.10.2022

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