budget 2020 Archives • SwedeInternational

16 Oct. – municipalities still mostly broke

Sweden’s municipalities
pic: https://www.dn.se/nyheter/politik/fyra-av-fem-kommuner-tvingas-skara-ner/

Things are not looking good on the municipality front. The results from Dagens Nyheter’s municipality survey is just in – 4 out of 5 municipalities will be cutting some services in the coming year (DN.se/municipalities). Meanwhile, one would be hard-pressed to find a political party that didn’t swear on every bible in 20 counties that they weren’t supportive of the local communities every waking moment. Something isn’t adding up.

When talking about cutting services, it generally means elder services, social services and schools. To that end, or rather to try and prevent that end, the government and their supporting Center and Liberal parties have promised 5 billion kronor during the rest of their term in office. (Just for fun, you can compare the 5 billion kronor they are promising with the 90 billion kronor Minister of Finance Magdalena Andersson says is needed by 2026.)

According to Helsingborg municipality, “the working population is just not paying enough taxes to cover the costs of taking care of both the young and the old – and the government isn’t helping bridge the gap.” So far, Helsingborg says, they’re not going to raise the municipal tax – but every tenth municipality, of the 197 municipalities that answered, says that they are. (There are a total of 270 municipalities in Sweden.)

According to questionnaire results, the top reasons for the deficit are:

costs are rising faster than income
demographic changes
high costs
less income

The most common expense they were planning on reducing was:

everything (all verksamhet)
unspecified (ospecifierad)
care and services (vård och omsorg)
schools

The overwhelming majority wrote in “everything” to DN’s question, which one can’t help but read in as a certain degree of hopelessness. Some municipalities have been running a deficit for many years, despite good times in other parts of the country. DN notes that saving on schools is particularly troublesome because school is not just a right but an obligation – if your kid isn’t attending school you’re actually breaking the law. Not providing for schools is therefore, in a sense, breaking contract (DN.se/contract). On the other hand, it’s hard to find a tax that doesn’t imply that the government is obliged to deliver something in return, be that hospitals, roads, defense, infrastructure, etc. It’s why we pay taxes.

While the government pays homage to the municipalities – without actually paying – the countdown to the presentation of the budget – this November – is already ticking. Perhaps this latest survey will be a kick in some direction, either a declaration of massive funding – or a declaration of “No, sorry, we can’t keep this up”. More likely, however, there will be many words of little substance. This survey, while fresh, is still, sadly, old news.

9 Oct. – no such thing as free coffee

A lot of the news is centered in Stockholm – ask anyone who lives outside of Stockholm. Also Brussels is a news hog, since the laws we live under here have to comply with laws created there. Today’s blog, though, goes up north to Kiruna, even as it also goes to the very heart of this coffee-loving nation.

First, some background. Schools around the country are going to have to make do with less money in the new budget year. Kiruna municipality is cutting the number of its student assistants from 75 to 25 as one of its cost-cutting measures, Aftonbladet reports. Then, one of it’s municipality workers posted on facebook: maybe spend the money we spend on coffee on student assistants instead? “Many people think offering a coffee is about the only thing the municipality does, and we need it. But we work here anyway so maybe we can afford to bring our own coffee” she said to Norrköping newspapers.

Kiruna spends just over a million kronor a year on coffee in its office machines. And it’s true that a million kronor would pay for a couple of student assistants for a year. But it’s not going to solve the budget problem, nor are municipality workers living high on the hog at the workplace. Coffee is likely the one perk they have, and no one needs coffee like a teacher. Making coffee a scapegoat for budget problems isn’t the way to go.

18 sep. – a jobs package that we hope helps

A lot has been said about Sweden’s budget, as hints of what it will contain came out in dribs and drabs. It’s been talked about in this blog here, here, here and here. Here, and here too. But the guessing is over – the budget came out today.

Most of what had earlier been leaked came true, although the numbers sometimes took a hit. One thing that hasn’t been talked about so much in advance is the jobs package. We have now learned that the government, the Social Democratic party and the Green party, and its supporting cast of the Center and Liberal parties, have put together a packet of job-related measures expected to cost 1.3 billion kronor.

The jobs package is an umbrella term for measures that aim to increase employment and employability. Latest unemployment figures show an increase of a full percent, to 7.1% unemployed in August. This is 56,000 fewer people than were employed at this time last year. Sysselsättningsgraden – how many people were employed for at least one hour during the measured week – was 68.3% in August (bit.ly/EkonomifaktaSysselsättning). The buzz is that an economic downturn is on the horizon, and these numbers aren’t encouraging.

Of the 1.3 billion kronor, the biggest outlay is for paying for extra services and introductory jobs (extratjänster och introduktionsjobb). Extra service jobs are jobs mostly in the service sector and are directed to long-term unemployed and newly arrived immigrants. Introductory jobs are largely the same but are private-company based. The government pays the employer to employ someone, and that person in turn receives a regular job-commensurate salary. The government basically tries to make it easier and economically advantageous to hire people who would not normally be very sought after. About 427 million kronor has been designated for this effort, and 2,200 people are expected to benefit from it ( http://bit.ly/AftonbladetJObbpaket).

Another outlay goes to labor market training programs, in which a job seeker receives training for a specific field or job that the Employment Service (Arbetsförmedling) thinks they’re suited for and in which there is a need for workers. Bus drivers, truckers and even excavator operators are named as occupations that need filling (http://bit.ly/AftonbladetJObbpaket).

Another financial injection has been designated for “education lifts” (kunskapslyft). In this case, 281 millions kronor is earmarked for the further education of adults who have some education behind them but who need more to better meet job market requirements. Another example is funding the pedagogical education for adults who have job experience behind them but who need the extra education to become qualified teachers. 1000 people are expected to be helped by this measure (http://bit.ly/AftonbladetJObbpaket).

The jobs package budget proposal will be replacing funds that the current Moderate and Christian Democratic budget cut back last spring. These programs were cut because they were generally considered ineffective – more people did not find jobs after having gone through these programs than if they hadn’t. But now these programs are back, in basically unchanged form.

12 sep. – a better economy for those with a fixed economy

“Life should be good for the country’s retirees,” said Löfven. “That’s all there is to it” (). With these words, the Prime Minister announced that taxes on pensions are going to be reduced for all retirees with a pension of more than 17,000 kronor a month (retirees with a pension lower than 17000 a month got a tax reduction last year).

Although he made it sound like the most obvious, and easiest, thing in the world to do, if it had been, he would have perhaps done this earlier than five years after having taken power. The Moderate Party’s economic spokesperson Elisabeth Svantesson didn’t waste any time giving her response: “Retirees have gotten tax reductions to the tune of 27 million kronor over the last ten years, and the Moderate Party has been behind 21 of them” (b). It appears everyone is in agreement that reducing taxes on people that can’t exactly go out and get a new job with a better retirement plan is a good idea.

The government also announced raising the basic pension by 200 kronor a month. The basic pension is what is doled out to persons that have no other retirement income, and also to those who have a pension but one that is extremely low. This is a lot of people, people. 675,000 people, according to Expressen. Even the housing supplement is being raised to a maximum of 7000 kronor a month for singles (3500 kronor for a married person).

All in all, the measures announced today will come in at 4.3 billion kronor (). Where exactly the money is coming from, and what might take a hit, remains an awkward question that definitely poisons the punch bowl.

Hold on to your hats, the full budget will be presented on the 18th of September.

9 sep. – more budget bits

The Green Party, Center Party and Left Party have all had their speeches in the spotlight regarding the budget bits they say they’ve won. The ruling Social Democrats open parliament tomorrow, so today was the Liberal Party’s turn to claim cred for getting something through budget negotiations.

“It’s time to be serious about starting up Sweden’s cement mixers” said Johan Pehrson, group leader for the Liberal Party (). He’s talking about building jails, presumably, not new footwear: The Liberal Party’s message was the 700 million kronor that is going to be allotted to upgrading the whole judiciary system and related instances. Everything from proactive measures to prevent crimes from being committed, to customs enforcement, to police resources, the coast guard and the coroner’s office, to Sweden’s Security Service and legal staffs, to actual penal buildings – they’re all are going to get a slice of the pie.

The question is if the pie is big enough to feed all those hungry mouths. According to the Liberal Party, these efforts are being made due to the persistent and persuasive efforts of their party, but aside from actual numbers there was hardly disagreement about the need for some sort of system restorative. The judicial system (rättsväsendet) gets a little under 50 million kronor in the current budget, so this is a little tonic, not a large one (). Perhaps not coincidentally, the Liberal Party is a little part of the discussion, not a large one.

7 sep. – 70 million kronor to the bees

Little budget crumbs continue to be scattered to the press and public for consumption. Yesterday, it was the Green Party’s time in the sun, who announced how much is proposed to be spent on various climate measures ().

The biggest recipient for climate money is what they call the Great Step for the Environment (klimatkliv). It sounds better, and more western, in Swedish, but is basically a pot of money set aside for local and regional environment initiatives.

The website for the fund, which reads like an infomercial, puts it like this: “Do you have an idea to reduce society’s climate footprint? Then apply for funding from Great Step for the Environment. Through smart, innovative solutions we can reduce greenhouse gases and move towards a more climate-smart society.” Great Step for the Environment is receiving an additional 1.16 billion kronor, for a total of nearly 2 billion kronor in the 2020 budget.

The next Great Step is given to industry to help them change over to a more environmentally friendly way of working. Great Step for Industry (industrikliv) will have about 600 million that can be applied for by businesses that are working to reduce greenhouse gas emissions either in their industrial processes, or through working to collect and store greenhouse gases. Great Step for Industry is not such a great step, perhaps, getting less than half of what GSforE gets.

The following budget items get only less money, and are somewhat less clear in their method:

400 million kronor for steps to look after valuable nature (åtgärder för värdefull natur), which includes national parks, reserves and marshlands
240 million kronor for measures on behalf of the ocean and water environment (åtgärder för havs och vattenmiljö)
200 million kronor for safeguarding valuable nature, (skydd av värdefull natur) like forests
80 million more kronor to document the health of, and changes in, the environment (miljöövervakning)
70 million kronor for measures to help and support pollinators (pollinatörer) – bees, and other important insects) Measures might include, for example, planting more meadows, or flowers planted by roadsides or in the middle of roundabouts, etc.
65 million for clean oceans (literally a drop in the bucket)
50 million for “green cities”

The Swedish Society for Nature Conservation (Naturskyddsverket) is happy not happy. “It’s welcome, but not enough” was the rather predictable response. “The pollinator support is terrific, but where is the tax on pesticides?” was one complaint ().

In total, the budget for environment measures is 2.9 billion kronor, a level that could be a reflection of the level of popularity for the two Green Party leaders (not so popular, see this post). In which case, it’s both awful and ironic that the environment suffers from its association with the Green Party.