February 13, 2019 / 3:45 PM / 3 months ago

UPDATE 1-Swiss 2018 budget surplus 10 times higher than planned

(Adds comment from finance agency)

ZURICH, Feb 13 (Reuters) - Switzerland ran a federal budget surplus of 2.94 billion Swiss francs ($2.92 billion) in 2018, 10 times greater than planned, as tax revenue overshot projections and the state kept a tight grip on spending, the government said on Wednesday.

Including extraordinary income, the surplus topped 3 billion francs, provisional figures from the finance ministry showed.

The money will be used to reduce debt, a spokesman for the Federal Finance Administration said, dismissing grumbling from some politicians that larger-than-expected surpluses had become a habit for penny-pinching Finance Minister Ueli Maurer.

“We have the comfortable situation that we have invested a lot — in education, transport, special funds for rail infrastructure — and still were able to reduce debt. It’s not as if we have neglected investments,” he said.

He noted that the swelling 2018 budget surplus had in December prompted the government to slash planned borrowing for 2019.

“The outlook for 2020-2022 has improved given the good development of revenue, so from today’s perspective no savings measures will be needed in 2020,” the agency said in a statement.

Drawing up planning for the next budget process, it projected a structural surplus of 400 million Swiss francs in 2020 despite an anticipated 1.4 billion-franc hit from tax and pension reforms.

It pencilled in structural surpluses of 1.1 billion francs in 2021 as proposed changes to taxation of married couples kick in a year later than envisioned, and of 200 million francs in 2022 as Switzerland abolishes industrial tariffs.

The federal government’s 2019 draft budget sees a surplus of 1.26 billion francs as revenue grows faster than the spending originally planned, it said in August.

$1 = 1.0053 Swiss francs Reporting by Michael Shields, editing by Larry King; Editing by Toby Chopra

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