24 February 2003


No promises from Solberg (Dagsavisen)

Local Government and Regional Affairs Minister Erna Solberg is refusing to promise more local authority cash. The opposition has accused the Government of not taking the crisis in the local government sector seriously enough. The Norwegian Association of Local Authorities (KS) and the Government are due to meet today for talks on local authority finances. The KS will present the gloomy reality currently facing the local government sector. Six out of ten local authorities ended last year with a deficit; the situation has not been as bad as this during the entire post-war period. “We have said that local authority budgets will be increased, but have never promised more than is necessary to cover the growth in costs,” said Ms Solberg. “If it had not been for extraordinarily large costs linked to wage increases and pensions, far more local authorities would have emerged from last year with a revenue surplus,” she said.

Government accused of ducking responsibility for unemployment (Aftenposten/Sunday)

Labour leader Jens Stoltenberg thinks we could be at an economic turning point, and has accused the Government of being passive. “The Government must stop blaming everybody else but itself. The Government has now signalled that it will not intervene, and has said that businesses, employers and unions, and everybody else is responsible for the problems facing the economy. The point is that policies work. There is no law that says how high unemployment must be. It is possible to keep unemployment down, but to do so requires the good offices of all concerned,” he said. Mr Stoltenberg claims that the Bondevik government is not using the freedom it has, under the rules governing how much of the country’s oil wealth can be spent, to use the budget to stabilize the economy in periods of both economic growth and contraction.

Stoltenberg accused of being two-faced (Aftenposten)

Tempers were running high after Labour leader Jens Stoltenberg accused the Government of sitting on its hands and doing nothing, while more and more industrial companies go to the wall and unemployment rises sharply. “I categorically deny that we are washing our hands of responsibility,” said Finance Minister Per-Kristian Foss. “The Government has set its entire budget policy for 2003 with the aim of doing something about the fundamental problems causing the collapse of industrial production and the rise in unemployment: high costs, generous wage settlements, the strong currency and a lack of modernization. Mr Stoltenberg is being politically two-faced. He gives the impression that we should spend more money at the same time as he criticizes us for spending too much,” said Mr Foss.

Government accused of exploiting the unemployed (Dagbladet/Saturday)

The Bondevik government is deliberately exploiting the growing number of unemployed to achieve a cut in interest rates, according to the Progress Party’s Siv Jensen, who chairs the Storting’s Finance Committee. “Unemployment has grown significantly faster than the Government envisaged when the budget was cobbled together. And now they are sitting perfectly still and are obviously thinking that if only unemployment would rise, interest rates will come down. This is not a message to send to those who have lost their jobs, particularly not at a time when the country needs revenue creation,” said Ms Jensen.

Three-fold increase in number of people reporting threats (Aftenposten)

The Police Directorate is concerned by the substantial increase in the number of people reporting to the police that they have been threatened. In the past ten years, the number of threats reported to the police has risen from 3,354 in 1991 to 9,011 in 2001. “Threats generate fear and insecurity, and have a negative impact on the quality of life of many people. Even though the threats do not necessarily lead to action, we have good reason to take this trend seriously,” said Ingelin Killengren, head of the Police Directorate. Two out of ten cases relate to disputes over money and debt recovery.

Unions disagree over wages strategy (Dagsavisen/Saturday)

The unions affiliated to the Norwegian Confederation of Trade Unions (LO) disagree over what kind of pay rises they should be demanding when this year’s round of centralized wage bargaining gets underway. The LO’s executive committee is due to draw up the guidelines for this year’s wage negotiations on Tuesday. The biggest question is what signals the LO will send to Central Bank Governor Svein Gjedrem. The level of moderation adopted by the LO could determine how much interest rates will be cut this spring.

Socialist Left Party accused of being Saddam’s errand-boy (Dagbladet/Sunday)

Progress Party chairman Carl I. Hagen dedicated large parts of yesterday’s speech to the party’s national executive committee to a full-frontal attack on Kristin Halvorsen and the Socialist Left Party. “It is time to call a spade a spade. Just as the Socialist Left Party acted as errand-boys for Moscow communism, they are now doing the same for Saddam Hussein. The Socialist Left Party is calling for the withdrawal of US troops, but it is the realistic threat of force which can get Saddam to step down. When the Socialist Left Party opposes Nato help for Turkey, it is gambling with Norway’s own security,” said Mr Hagen.

Local authorities not carrying out alcohol checks (Nationen)

Each year local authorities receive more than NOK 100 million in charges that are supposed to be spent on checking up on the sale of alcohol. But despite this, only three retail outlets lost their licence to sell alcohol after checks last year. Local authorities are now demanding even more money to check up on the sale of alcopops. But many local authorities drop the alcohol checks and spend the money on other things. There is no public control body to ensure that local authorities actually carry out the checks they are supposed to do.

State Housing Bank to become social bank (Aftenposten)

Up until now loans from the Norwegian State Housing Bank for the construction of new homes – building loans – have been available to all, on condition that the home in question meets certain standards with regard to size, quality and cost. But according to Local Government and Regional Affairs Minister Erna Solberg, the State Housing Bank will in future be used to provide loans to those who have difficulty entering the housing market. This year, the State Housing Bank has already decided to provide loans for small homes at more advantageous terms than loans for large homes.

International investors do not trust Norwegian executives (Dagens Næringsliv)

Many international investors do not trust Norwegian executives, which is why they steer clear of all but the largest Norwegian companies, according to British fund manager Hugh Hendry of Odey Asset Management. He underlines that the problem lies not with the Norwegian market nor the Norwegian authorities’ policies, but with the companies themselves and their managements. “I am sorry to have to say this, but Norwegian executives lack credibility,” said Mr Hendry.

Røkke planning gigantic sell-off (Aftenposten/Saturday)

Leif Arne Langøy, chief executive of Aker RGI, has been told to sell off assets up to the value of NOK 1 billion. Investor Kjell Inge Røkke is also thinking of selling his luxury yacht, an apartment in London and his private Boeing jet. Aker RGI has already sold shares worth hundreds of millions of kroner. The question is whether Mr Røkke is planning a raid, or just needs the cash. This coming Friday he is due to pay off a loan worth NOK 750 million, and in April another loan worth NOK 1 billion falls due.

Worth Noting

  • Conservative ministers Per-Kristian Foss and Victor D. Norman have been arguing over how much it will cost to relocate eight central government bodies out of Oslo. Representatives of the 900 employees concerned and the organizations themselves will meet today for a marathon hearing in the Storting on the subject of relocating central government jobs.
    (Dagens Næringsliv)

  • Progress Party chairman Carl I. Hagen intends to make the battle against unemployment a key issue for the party this spring. The main solution is a pay-freeze for one year.

  • While the Conservative Party and Liberal Party’s women’s affairs leaders want the current Bondevik-led coalition government to continue after the next general election, the Christian Democrats’ Rigmor Kofoed-Larsen has said she was open for a coalition with a different political composition.

  • The Centre Party is currently too small to join a coalition government alongside the Labour Party and the Socialist Left Party, according to Åslaug Haga, who is soon to take over as party leader. Ms Haga fears that the Centre Party will suffer the same fate as the Liberals in the current ruling coalition, and become an invisible junior partner.

  • More teenage girls in Norway have a baby than in any other Nordic country. The proportion of young mothers is twice as high as in Sweden. The reason could be that Norway is less urbanized than the other Nordic countries.

  • Last year, local authority parking metres swallowed up almost NOK 300 million – and that was just in the country’s largest cities. Of this huge sum, central government pockets NOK 71 million in VAT, an extra tax the Storting introduced two years ago.
    (Verdens Gang)

  • The Norwegian Medical Association’s pension fund was the first organization in Norway to avoid investments in the nuclear weapons industry. It was a decision that lost it money.

  • Five state-dominated companies listed on the Oslo Stock Exchange, Statoil, Den norske Bank, Norsk Hydro, Telenor and Kongsberg Gruppen, have proposed the payment of a record dividend of almost NOK 12 billion this year, of which the state will receive almost NOK 8 billion.
    (Dagens Næringsliv)

Today’s comment from Aftenposten

It is barely seven months until the local elections, and no one need be in any doubt that Carl I. Hagen was well aware of this fact when he presented a belligerent, uncompromising political strategy to the Progress Party’s national executive committee meeting on Saturday. Rising unemployment is worrying more and more people, and Mr Hagen has undoubtedly put his ear to the ground when he declares that the battle against unemployment will be the Progress Party’s most important issue this spring. It says a lot about Carl I. Hagen that in doing so he is challenging the Labour Party on its home ground. However, it says just as much about how difficult it is to place the Progress Party on a classic left-right axis. We see more clearly than before that the party borrows political arguments from both the right and left, and puts them together in its own way. That the political measures it calls for do not hang together does not seem to worry Mr Hagen overly.