As the cost of living continues to rise in Switzerland, members of the government are due to debate plans to help ease the financial burden on residents of the alpine nation. The National Council, the lower house of parliament, has been summoned for an “extraordinary session” on Wednesday to propose ideas to tackle the crisis, with the upper house set to follow suit next Monday. 

Update: the National Council has now voted to approve some of the policies proposed (see below).

What measures are being proposed to ease the cost of living in Switzerland?

On Wednesday morning, the Swiss National Council in Bern will begin debating and voting on measures designed to curb the rising cost of living. Recent reporting from Blick found that families are set to lose upwards of 4.000 francs a year to higher prices, with the purchasing power of Swiss workers declining significantly in the last year.

Each political party in Switzerland is expected to put forward their own ideas to help solve the crisis, with the goal of, in the words of Le Matin, helping “the middle class and low incomes [who are] faced with rising energy prices” and the rising cost of basic and supplemental health insurance. The proposals decided upon by the council will then be put to the upper house of parliament, the Council of States, next Monday.

Increasing Swiss pension and AHV payments to cover inflation rises

First, the Centre and a number of other parties have called for an “immediate inflation adjustment for AHV and pensions.” This would instruct the Federal Council to increase pension payments to cover the rising cost of living by January 1, 2023 at the latest. The chamber is also due to discuss whether pensions should always be increased when inflation rises above 2 percent a year.

Reducing the cost of Swiss health insurance through premium deductions

Next is a plan by the Social Democratic Party (SP) to increase the premium deduction given by the government towards basic health insurance. This is to help cover the significant rise in health insurance costs, which are due to be announced in detail next Tuesday. 

Cuts or suspensions of major Swiss taxes

Along with plans to increase pensions and reduce health insurance payments, the Swiss People’s Party has proposed a raft of measures which include:

• A motion that would make insurance premium payments fully deductible on Swiss tax returns.
• An immediate end to the imputed rental value tax - which was already voted for at the commission level in August. 
• A compromise where increases to pension payments and AHV are made, but not indexed to the cost of living so that no taxes will have to be increased to pay for it. Instead, the money for the scheme would be taken from international development funds, research, education and cultural spending.
• Suspending the mineral oil tax on petrol and diesel for two years, or an abolition of the tax entirely.

An energy bonus to be given to Swiss households in need

The final proposal on the table comes from Franziska Ryser, National Councillor for the Green Party of Switzerland, who calls for an “energy bonus” to be given to those most in need. This would be achieved by adding the bonus to the premium reduction given in mandatory health insurance.

Swiss Federal Council refuses to budge on cost of living

However, while some of the proposals may have a majority in both houses, the executive Federal Council has been adamant that it won’t do anything to ease the cost of living in the short term. Finance Minister Ueli Maurer told 20 minuten that the federal government was already set to have a 5 billion franc deficit by 2025, telling reporters, “you have to tell me where we should get the money from if we decide to spend more now."

This was challenged by the President of the Centre Party, Gerhard Pfister, who told 20 minuten that "doing nothing is not an option." He said that the Federal Council was responsible for helping the population, not just international companies and energy providers, and if they were so opposed to what is being planned in parliament, they should submit some policies themselves.

Update: National Council votes to approve two measures

Out of all the policies proposed, the National Council has voted to approve two of the eight proposals. These are the Centre's proposal to immediately increase AHV and pension payments, and the SP's proposal to increase the premium deduction included in Swiss health insurance. The accepted votes will be discussed by the Council of States next Monday.