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Spending cuts outlined to limit state deficits

The government has approved details of a planned programme to save about SFr1.5 billion ($1.47 billion) annually in the next few years.

Finance Minister Hans-Rudolf Merz said the aim was to limit the expected deficits of 2011 and 2012.

"We still foresee a SFr700 million surplus for this year, but we will be in the red as of 2010," he told a news conference on Wednesday.

Merz outlined a series of measures, including inflation-related spending reductions and job cuts mainly through natural wastage, as well as plans to trim the outgoings of the seven ministries by SFr280 million annually.

The cabinet also considers extra revenue by raising the tax on a package of tobacco.

Merz described the measures as "reasonable and in line with the previous finance policy" and said Switzerland's finances were sound in comparison with other countries.

He added that the recent attacks by other countries on Switzerland and its financial centre had to be seen in this context.

The finance ministry has been mandated to present a report by next March which will help the government draft the 2011 budget.

Urs Geiser, swissinfo.ch


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