In an exceptionally rare decision, the National Council’s finance committee has recommended rejecting Switzerland’s federal budget for 2027. Federal finance experts could recall no previous instance of a finance committee rejecting a budget at this stage, SRF reported.
An unusual alliance between Switzerland’s political extremes has come together to challenge the financial plan put forward by the Federal Council, Switzerland’s executive. The Swiss People’s Party (UDC/SVP), the Socialist Party (SP) and the Green Party all oppose the budget, but for very different reasons.
The UDC/SVP wants deeper spending cuts to avoid higher taxes. The two parties on the left oppose cuts to spending on public services, welfare and climate protection.
The committee recommends that the National Council reject the budget and return it to the Federal Council for revision.
Both houses of parliament will debate the budget in December, during the winter session.
The right wants spending cuts
The UDC/SVP objects to two proposed increases in value-added tax (VAT), neither of which has been approved. Voters will decide at the end of the month on an increase to fund the 13th annual payment under the state pension scheme.
A second VAT increase, intended to finance the army, still requires parliamentary debate. The government has nevertheless included it in its financial plans for 2027.
The UDC/SVP wants to scrap both tax rises and cut spending instead, particularly on development aid, migration and asylum, federal staffing and external services, to help finance the army and state pensions.
The left opposes the cuts
The SP and the Greens take the opposite view: they argue that the budget cuts are excessive. They object to spending billions on the army while cutting back on the public sector, welfare and climate protection. They also criticise the UDC/SVP-backed increase in income support for farmers, while support for other groups is cut and proposals such as the SP’s plan to make rents more affordable are rejected.
The centre warns of chaos
The Centre party condemned the finance committee’s rejection of the budget. Polarisation offers no solutions, it said on X. A member of the National Council for the Centre party criticised both sides, describing their behaviour as uncompromising, un-Swiss and likely to lead to chaos.
The PLR/FDP criticised the UDC/SVP, the SP and the Greens for torpedoing the federal budget. It warned that these populist parties risked throwing federal finances into chaos and weakening Switzerland’s security by jeopardising plans to strengthen the army.
The committee’s recommendation to reject the budget does not end the parliamentary debate. The National Council must consider the budget, including more than 100 amendments proposed by its finance committee.
If both the National Council and the Council of States reject the revised budget in their final votes, it will return to the Federal Council for revision. The same applies if either chamber rejects it twice in final votes.
The vote on November 29 on raising VAT to fund higher state pension payments will at least settle one point of contention.
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