Swedish finance minister opens up for rise in spending in next budget

Sweden’s finance minister, Elizabeth Svantesson, has revealed that she has 60 billion free to spend on tax cuts or new measures, as she signalled a more expansive fiscal policy for 2025.

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The finance ministry has set the so-called reformutrymme, literally “space for reforms”, at 60 billion, up from the 40 billion of spare cash the government had for new measures in its 2024 budget, which she said would be allocated both towards putting more money directly in people’s pockets and towards investment in welfare and infrastructure. 
“It’s not all wrapped up yet, but a lot of it is wrapped up,” Svantesson said of the ongoing budget discussions between the three government parties and the far-right Sweden Democrats. “We believe that 60 billion kronor is a good balance. It’s a significant rise from this year.”

She said the 20 billion kronor in increased spending room would enable the government to be bolder in its plans, and could also be augmented by making cuts in some places in order to free up money for spending elsewhere. 

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“Then we can do a lot more if we prioritise in other ways: if you don’t promise something for everyone, but instead do what you think is important,” she said.
She promised proposals to boost household spending power and stimulate the economy, something she said was necessary given that Sweden remained in an economic slump.  

READ ALSO: Sweden in ‘clear recession’ as economy continues to tread water

“In a long-drawn-out economic downturn the economy needs to be stimulated,” she said. 
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At the same time as the press conference, the government adjusted down its forecast for the economy, with GDP growth for 2024 reduced from the 1.4 percent forecast in June to 0.8 percent. 
It expects GDP growth to be higher in 2025, however, increasing the forecast from 2.4 percent to 2.5 percent. The unemployment rate for both 2024 and 2025 is predicted to be 8.3 percent, a slight reduction from June’s forecast. 
The government expects inflation to come in at 2.8 percent in 2024, falling to 0.9 percent in 2025. 

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The finance ministry has set the so-called reformutrymme, literally “space for reforms”, at 60 billion, up from the 40 billion of spare cash the government had for new measures in its 2024 budget, which she said would be allocated both towards putting more money directly in people’s pockets and towards investment in welfare and infrastructure. 
“It’s not all wrapped up yet, but a lot of it is wrapped up,” Svantesson said of the ongoing budget discussions between the three government parties and the far-right Sweden Democrats. “We believe that 60 billion kronor is a good balance. It’s a significant rise from this year.”
She said the 20 billion kronor in increased spending room would enable the government to be bolder in its plans, and could also be augmented by making cuts in some places in order to free up money for spending elsewhere. 
“Then we can do a lot more if we prioritise in other ways: if you don’t promise something for everyone, but instead do what you think is important,” she said.
She promised proposals to boost household spending power and stimulate the economy, something she said was necessary given that Sweden remained in an economic slump.  
“In a long-drawn-out economic downturn the economy needs to be stimulated,” she said. 
At the same time as the press conference, the government adjusted down its forecast for the economy, with GDP growth for 2024 reduced from the 1.4 percent forecast in June to 0.8 percent. 
It expects GDP growth to be higher in 2025, however, increasing the forecast from 2.4 percent to 2.5 percent. The unemployment rate for both 2024 and 2025 is predicted to be 8.3 percent, a slight reduction from June’s forecast. 
The government expects inflation to come in at 2.8 percent in 2024, falling to 0.9 percent in 2025.