Parliament approves extra CHF14.9 billion for Covid relief

Like guests at this restaurant in canton Lucerne, government debt analysts will also have a lot on their plate Keystone

A further CHF14.9 billion ($15.5 billion) has been agreed by parliament to cope with the coronavirus pandemic. Most of it will go towards unemployment insurance, which finances short-time work compensation. 

With the new credit package approved in the Senate on Thursday, coronavirus costs for the government will almost double. In an extraordinary session at the beginning of May, parliament approved around CHF16 billion of funds to cover lost wages, the purchase of medical equipment and other expenses. This tranche of funds has now been increased to CHF31 billion. 

This is part of a much larger package of financing, which also includes some CHF40 billion in emergency loans for companies. Before Thursday’s granting of extra funds, the government had already set aside more than CHF65 billion to support the economy. 

The government estimates that the budget deficit in 2020 will amount to around CHF40 billion. 

But Switzerland can afford the expenditure, said parliamentarian Eva Herzog, echoing a similar statement by Finance Minister Ueli Maurer at the height of the Covid-19 wave. “We are less in debt after the crisis than our neighbours before the crisis,” Herzog said. 

The finance commissions will discuss how the eventual state debt could be reduced at a finance policy seminar at the end of June.