Reuters International

Four Pilatus PC-7 aircrafts of the Swiss Air Force fly over the Swiss Parliament building in Bern, Switzerland June 17, 2016. REUTERS/Ruben Sprich


ZURICH (Reuters) - The Swiss government is expecting the federal budget deficit to rise to around 600 million Swiss francs (453 million pounds) next year due to the costs of rising numbers of asylum seekers.

The government also forecast annual deficit of 1.4 billion to 2 billion francs in the 2018-2020 financial plan, which it said was only partly due to migration costs, and said it would unveil a savings package for these years this autumn.

Switzerland is expecting the number of asylum applications to rise to 45,000 this year, from 39,500 last year, Switzerland's finance minister told a media conference on Wednesday, adding this acceleration would result in an increase in migration expenditure of 850 million francs in 2017.

The Swiss finance ministry expects a financing deficit of 500 million francs in 2016.

"As long as we play by the rules that we promised to respect because we are part of the Schengen space, the numbers will go up," Ueli Maurer of the right-wing Swiss People's Party (SVP) said at the briefing, which was webcast.

Later this year, the government will ask parliament to approve paying part of the migration costs out of a separate fund for exceptional expenses in order to make sure the country respects its debt brake.

($1 = 0.9789 Swiss francs)

(Reporting by Silke Koltrowitz; Editing by Toby Chopra)


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