Top government economist rejects need for aid packages

Switzerland is less vulnerable to high energy prices than its European counterparts, reckons Eric Scheidegger © Keystone / Urs Flueeler

Economic relief packages due to the looming energy crisis are not planned in Switzerland. Measures such as tax relief are currently neither “necessary nor helpful”, says the government’s chief economist.

The Swiss economy is developing well even after the outbreak of the war in Ukraine, said Eric Scheidegger, deputy director of the State Secretariat for Economic Affairs (SECO) and head of the Economic Policy Directorate, in an interviewExternal link with the SonntagsZeitung.

Switzerland is less vulnerable to high energy prices than its European counterparts, he said. “I’m not saying we won’t have problems, but we’re in a much better position.”

To that end, Scheidegger said it has been known since spring that there could be power shortages in winter. “Companies have time to prepare for this – unlike with the Covid pandemic.”

‘Island of bliss’

Scheidegger also sees Switzerland on course in terms of inflation: at 3.4%, it is much lower than in other countries, he said. “Compared with the 9% in the US, we live on an island of bliss. Inflation should start to fall again in autumn.”

Because the situation could still be challenging for low-income households, Scheidegger suggested targeted relief measures instead of the watering can principle, in which everyone gets the same amount. For example, health insurance premium reductions could be temporarily increased or welfare and pensions adjusted.

Scheidegger does not expect a recession this year. “However, the economic forecasts for next year might have to be adjusted downwards,” he said.

Stock up on candles

In the NZZ am Sonntag, however, the country’s top electricity supervisor said the public must expect temporary power cutsExternal link this winter in the worst case.

“Everyone should consider what they would do in the event of a blackout lasting several hours,” said Werner Luginbühl, president of the Federal Electricity Commission (ElCom). “It is certainly advisable to have enough candles in the house. Those who have a wood stove should also make sure they have enough firewood.”

Stella Jegher of Pro Natura criticised the government for making no efforts to save electricity. “We waste vast amounts of energy,” she told the SonntagsBlickExternal link. “In daily consumption alone, industry, business and private households could save around a third of electricity without even noticing.”