MIL-OSI Translation: Federal Council adopts message regarding federal law on financial and administrative relief measures from 2025

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

Source: Switzerland – Department of Foreign Affairs in French

Federal Council

Bern, 01.03.2024 – During its meeting on March 1, 2024, the Federal Council adopted the message concerning the modification of two laws: the law on unemployment insurance (LACI) and the law on the organization of government and of administration (LOGA). The modification of the LACI will reduce the federal budget by a total of 1.25 billion francs over the coming years.

The Confederation’s budget displays a structural imbalance because expenditure is growing more quickly than revenue. In this context, at the start of 2023 and 2024, the Federal Council defined various measures aimed at reducing structural deficits, some of which require legislative changes. This is why, on June 28, 2023, the Federal Council opened the consultation procedure relating to the 2025 relief package (see the press release of June 28, 2023 on this subject). Initially, this provided for two measures: a reduction in the share of direct federal tax revenue accruing to the cantons and a temporary reduction in the contribution paid by the Confederation to unemployment insurance (AC).

The reduction in the share of direct federal tax revenue accruing to the cantons was removed from the project. It was in fact intended to be used to compensate for the additional costs of the Confederation induced by the parliamentary initiative relating to extra-family care for children. In the meantime, the Council of States committee responsible for the matter has decided to send for consultation a project that is significantly less expensive for the Confederation. The Federal Council therefore considers that it is no longer necessary to provide for a reduction in the cantons’ share in a separate project. Fundamentally, however, he remains of the opinion that a possible project relating to extra-family care for children must be essentially financed by the cantons or the economy.

The main measure planned by the project is the reduction of the Confederation’s contribution to the AC by 1.25 billion francs over the period 2025-2029. It can be implemented without modifying the services, because the CA’s own capital is sufficiently high. This good financial situation is due to the extraordinary contributions amounting to 16 billion francs that the Confederation paid to the CA during the pandemic. These contributions enabled the CA not to go into debt despite the sharp increase in compensation in the event of a reduction in working hours and to avoid an increase in contributions. If the situation on the labor market remains favorable, the equity of the CA compensation fund will continue to increase in the coming years despite the reduction in the Confederation’s contribution. If, on the contrary, the situation on the labor market deteriorates significantly, a safeguard clause will guarantee that the CA does not experience financial difficulties. As part of the consultation procedure, the majority of parties and cantons expressed their support for this measure. The proposed project offers more flexibility than the one sent for consultation: the Federal Council and Parliament must be able to freely distribute the total reduction of 1.25 billion francs over the period 2025-2029. As part of the 2025 budget, the Federal Council plans a complete reduction in its contribution to the AC, which will reduce federal finances by almost 600 million in 2025.

The measure providing for the amendment of the LOGA also aims to reduce the administrative burden within the federal administration. The service agreement constituting the basis of the management discussion between a head of department and an office director will in future no longer be subject to regulations regarding structure and content. This modification of the LOGA was not part of the project sent for consultation. However, in 2021, as part of the evaluation of the new management model of the federal administration, the Federal Council had already decided to remove these requirements, which brought little benefit.

Address for sending questions

Michael GirodCommunication from the Federal Finance Administration AFFTel. 41 58 465 41


Federal Council

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

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