The refurbishment continues despite a tight transitional budget

It has been 60 days since the election and the negotiations for a new government are going slowly. Sweden has a government as well, with the moderate Elisabeth Svantesson as finance minister. However, the room for maneuver for this transitional government is very limited, which also applies to the state budget.

What Svantesson brings to the Riksdag on Thursday is largely a copy of the budget that has been valid for 2026. That is the basic principle of a transitional government: no new political initiatives, nothing that can be perceived as politically controversial.

There are exceptions to the main rule. For example, the authorities receive a certain mark-up to keep up with cost trends.

Exceptions can also be made when already made parliamentary decisions require more money to be implemented. This time it applies to the Correctional Service, which is expanding greatly to deal with the fact that more people will be incarcerated for longer due to stricter penalties. Planned investments in infrastructure are also completed.

Another exception applies to defence, where previously announced increases will be carried out next year. It is motivated by the fact that all eight parties in the Riksdag are in agreement on the issue.

Something that concerns households is that the tax reductions on fuel that have expired cannot be extended. Nor is the electricity subsidy included in the budget. The same applies to the discount on bus tickets. The announced increase in the tobacco tax will not go away.

The Ministry of Finance has landed in a positive assessment of the Swedish economy. The recession is considered over. Growth will decrease somewhat next year, but at the same time unemployment will fall.

The transitional budget runs a deficit, but according to officials at the Ministry of Finance, this is largely due to increased defense appropriations and support for Ukraine, which the entire Riksdag is behind.