Swedish minister sees spending curbs amid refugee influx

by Reuters
Thursday, 17 December 2015 21:50 GMT

STOCKHOLM, Dec 17 (Reuters) - Swedish Finance Minister Magdalena Andersson said on Thursday the government would cut spending by 8 billion crowns ($933 million) and reschedule other costs to bolster public finances strained by a record influx of refugees.

The centre-left government has already allocated additional resources in a supplementary budget bill to cope with the cost of migrants fleeing war and poverty in the Middle East and elsewhere.

By the end of last month, Sweden had received around 150,000 migrants this year. Andersson said in a signed article in the business daily Dagens Industri that the refugee crisis was a challenge "of historic proportions" and required cutbacks in other areas in order not to breach a long-standing public spending ceiling.

"The government will therefore reduce planned expenditure for 2016 in a number of areas," she said.

A spending cut totalling just over 8 billion crowns would be carried out in part by postponing some investments, while just over 11 billion crowns of expenditure originally planned for next year would instead be booked in 2015, she said.

"There are those who instead argue we should raise the spending ceiling. I don't agree," she said.

"If the spending ceiling were to be raised in a frivolous manner without having exhausted all other options, it would jeopardise confidence in the fiscal policy framework and thus also in the Swedish economy."

The spending ceiling, enshrined in budget law, was put in place after Sweden suffered a severe financial crisis in the early 1990s, in part due to weak public finances. ($1 = 8.5744 Swedish crowns) (Reporting by Niklas Pollard; Editing by Kevin Liffey)

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