The continual rise in inflation and loss of purchasing power for residents in Switzerland has sparked calls for direct action and aid from the government to help ease the rising cost of living. However, in answering questions from parliamentarians this week, the Federal Council said it would not act to curb rising costs for families and individuals.

Parliamentarians in Bern call for action on rising cost of living

With energy shortages looming, and a 9 percent rise in health insurance costs expected by the end of the year, politicians in Bern have called on the Federal Council - Switzerland's executive branch - to answer questions as to whether they intend to help people with rising costs. According to 20 minuten, the answer is no.

At a press conference on Monday, when asked about how it was going to protect the purchasing power of workers - which has already begun to decline - the council said “economic growth continues and the unemployment rate is below its level before the coronavirus crisis,” so action was not required. The executive argued that between 2010 and 2021, real wages for workers rose by 9 percent, and that current losses in purchasing power are accommodated for by social security.

Swiss Federal Council: It is up to private companies to raise wages

The Federal Council delivered a similar response to demands by the Swiss Party of Labour to index salaries, pensions and emergency welfare to the cost of living, arguing that "it is up to the social partners to negotiate salary increases." As for combating the rising cost of basic and supplemental health insurance, the council said “premiums reflect costs. An increase in the latter therefore generates a proportional increase in premiums.”

The negative responses continued in relation to the high petrol and diesel prices in Switzerland, with a spokesperson for the council telling 20 minuten that the government should “renounce a direct intervention on the prices (for example on the price of the gasoline), which would involve undesirable effects.” “An artificially low price would also create false incentives and could worsen the already tight supply situation,” they explained.

The council said that while current long-term proposals to reduce the cost of living are being considered, it "cannot prejudge” what decisions it will make. Concluding the press conference, the council argued that there is no need to take urgent measures.