Post sponsored by NewzEngine.com

MIL OSI Translation. Government of the Republic of France statements from French to English

Source: Canton of Neuchatel, Switzerland

25.09.2019 In the wake of the many positive reforms completed at the beginning of the current year, the Council of State presents a budget for the 2020 profit and loss account. The excess income amounts to 6.5 million francs and is accompanied by a net investment envelope of 96.8 million francs. The Council of State thus respects its commitments and confirms the perspective announced a year ago to see the canton out the head of the water. The financial plan 2021-2023, however, shows that the pursuit of reforms and rigorous management is necessary to ensure sustainable consolidation of cantonal finances. Although the accounts have repeatedly been balanced in the last decade, the budgets of the Canton of Neuchâtel have not returned to the black figures since 1957. Today, the 2020 budget shows a profit of 6, 5 million francs and net investments of 96.8 million francs. The Council of State thus fulfills the commitments set in its legislative program: the return to a positive and serene climate as well as the convergence of the efforts of many actors makes it possible to achieve a balanced budget. Additional expenses absorbed This profit is a reflection of a rigorous financial conduct conducted for several years by the Council of State. The 2020 exercise thus makes it possible to integrate many elements stemming from both federal and cantonal decisions. Examples include the depreciation of H20 ceded to the Confederation, the increase in concordance rates for out-of-canton placements in the penitentiary field, and the effects of recent LAMal subsidy jurisprudence. Added to this are the tax reforms, partly imposed by the evolution of federal law, coupled with the revision of inter-municipal equalization and the introduction of the new training contract, as well as aid for mergers for municipalities. The impact of the recent decisions of the Grand Council, including the introduction in the law of a mechanism of trend smoothing of tax revenues, the moratorium for the High School of Music (HEM) or the recapitalization of the hospital network Neuchâtelois, also In total, more than 50 million francs of additional expenditure are offset by an additional contribution from federal financial equalization. The objective of presenting a budget in the black figures for the 2020 financial year has thus been maintained. Program of impetus and transformations on the rails The 2020 budget also includes the vast program of impetus and transformations announced by the Council of State within the framework of its program of legislature and validated by the Grand Council in June 2019. Designed to increase the attractiveness and prosperity of the canton, it also contributes to the desire to boost investment, both cantonal and third-party, and consequently to stimulate, and if possible to prolong despite an uncertain economic climate, the economic recovery of these last years. Thus 70.8 million francs will be spent directly on this program by 2025, of which 52.8 million francs will be invested. With the expected leverage effects and coordination of efforts with many partners, the total effect of the program should be a multiple of these amounts. In the end, the 2020 budget respects the new debt brake mechanisms adopted by the Grand Conseil in June 2019 with a result greater than 1% of the overdraft recorded in the balance sheet, net investments in growth and included in the range of 4% at 5% of the decisive income and a goal exceeded in terms of self-financing. The financial plan and tasks for the 2021-2023 exercises, however, demonstrate that efforts will have to be continued in the coming years so that this return to the black figures is not ephemeral. While the growth in charges seems to be partly under control, revenues are likely to follow the opposite path with an expected decrease of at least 5 million francs per year in federal financial equalization, during next fifteen years. The effect of the tax reforms will also be measured over three years, with, in particular, a drop in revenue of around 10 million francs in 2021 and a low or non-existent revenue growth in the two following years. The global political and economic context also reinforces uncertainty over tax revenues, with companies based in cantonal areas engaged in global reorganization processes or particularly dependent on exports. The climate of international tensions, particularly between China and the United States, as well as the economic slowdown, are contributing to the rise in the value of the Swiss franc, which could have a detrimental effect on the activity of our exporting companies. The maintenance of the canton in the black figures will therefore be sustainable at the cost of great management rigor. The Council of State insists on the fact that efforts to maintain control of finances are always less brutal and less painful than those necessary to correct a financial slippage. The Council of State thanks all those who, through their efforts, contributed to the presentation of such an outcome and who make it possible to build the future of our canton with optimism.

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and/or sentence structure is not be perfect.

MIL Translation OSI