Rising health costs put Swiss cantons under budget pressure

Eleven of the 23 Swiss cantons that have presented 2027 budgets expect deficits, as rising health costs add pressure to public finances, SRF reports. The other 12 have budgeted for surpluses, though all figures remain provisional pending approval by cantonal parliaments.

Geneva forecasts the largest deficit, at 546 million francs, followed by Vaud with 356 million. The biggest surpluses are expected in Zug, at 291 million francs, Bern, at 269 million, and Zurich, at 207 million. Thirteen cantons expect their position to improve compared with their 2026 budgets.

Ernst Stocker, president of the Conference of Cantonal Finance Directors, said the cantons’ overall financial situation was mixed. While some may still be in a positive position in 2027, he warned that difficult prospects are emerging. Cantonal spending has risen sharply in recent years, and further costs are expected, particularly in healthcare.

Since this year, cantons have had to contribute more to premium subsidies under the indirect counterproposal to the Premium Relief Initiative. The federal government estimates this will add nearly 350 million francs in annual costs, with the increase expected to approach one billion francs by 2030. From 2028, the unified financing of outpatient and inpatient services, known as EFAS, will also require cantons to help fund outpatient treatment. Stocker said this would have a considerable effect on financial planning.

Bern faces rising costs despite a planned surplus

Bern has budgeted a 269 million-franc surplus for 2027, but its longer-term outlook is less favourable. From 2028, the cantonal government expects EFAS to add nearly a quarter of a billion francs in costs. It also forecasts almost 200 million francs in additional spending on supplementary benefits, citing demographic change and a sharp rise in disability insurance recipients.

Implementing the indirect counterproposal to the Premium Relief Initiative is expected to cost Bern about 60 million francs more than planned from 2028. Together, the three increases amount to roughly half a billion francs a year, substantially more than the canton’s planned surplus for 2027.

The national fiscal equalisation system is based on cantons’ tax capacity, not whether their budgets show a surplus or deficit. A canton can therefore receive substantial equalisation payments and still budget for a surplus, or contribute to the system while recording a deficit.