The government’s budget is putting pressure on state finances and is leading to surplus targets being missed, says the Swedish National Financial Management Authority (ESV).
According to ESV, the surplus in the public sector’s financial savings will fall from 0.9% this year to 0.6% next year as a result of the government’s budget bill, which is expected to reduce tax revenue and increase expenditure. This means the government will not achieve the surplus target of 1% over a business cycle.
Commenting the surplus in public finances, finance minister Magdalena Andersson (S) says the Swedish economy is strong and the tight fiscal policy has been effective, creating more than 120,000 jobs since the current government came to power. She does not want to increase public spending for the time being, but would like to prioritise job creation, welfare and the widening gap in society.
Referring to the current debate on defence spending, Andersson does not wish to promise any extra funding for the Armed Forces at present. She expresses surprise over the Moderates call for an increase in the defence budget this year, saying they had not included such a proposal in their shadow budget last autumn: “I have not been heard any analysis from them which explains why they have changed their minds. The Moderates must explain their behaviour, but I find it remarkable”.