Young people stand to gain from budget proposals

Increased allowances for students, an extra investment in the young unemployed and small companies and funds to help the homeless. Finance minister, Pär Nuder, has accommodated the Greens and the Lefty party on several policy areas in the budget negotiations.

On Tuesday, it looked as though the negotiations for the spring budget proposition would be over in record time.

“The negotiations have gone well,” said the Greens’ spokesperson, Peter Eriksson, who was particularly pleased with the investment to be made in small companies.

The Greens’ proposal for an annual billion kronor investment in rural development up to 2013 was taken on board. It’s part of an EU supported scheme, whereby the government will provide 800m kronor and the EU 200m. Possible targets for the cash injection include tourism, the food industry and energy conversion.

“This could mean 10,000 new jobs. It can create confidence and investment in rural areas,” said Peter Eriksson, who also hoped the migration from the country to the cities could be reversed.

The Greens also succeeded with their proposal for 300m kronor over the next few years for small business through business development organisations such as Almi and Vinnova.

The Greens and Left parties have made strong calls for increased allowances for students in higher education. The Greens’ demand is for 1,000 kronor a month extra in the allowance, a 500 kronor rise next year, and another 500 kronor in 2008. The Left party want to raise both the allowance and the loan by a total of 1,500 kronor a month.

On Tuesday, Nuder made an offer of an initial rise as early as this July.

Neither the Greens, nor the Left were satisfied with the figures suggested, so negotiations on that point are set to continue. The Social Democrats which TT has spoken to don’t want to make a big issue over student allowances, but at the same time point out that there is a pain barrier. An overly generous budget could mean that the central bank, Riksbank, intervenes and raises interest rates.

The Left party’s demand that a proportion of the investment intended to stimulate the job market should go to the unemployed between 20 and 24 years has also been taken on by the Social Democrats.

Likewise, the Greens’ wish for specials funds for the homeless.

The three parties have also agreed on new limitations for property tax, which should soften the blow of increased taxable values. At the moment the limitations only apply to property up to the value of 3m kronor. But now they will apply to properties up to the value of 5m kronor.