Membership of unemployment schemes to be compulsory

The Swedish government plans to make membership of unemployment insurance schemes compulsory from 1st July 2008.

“There is good reason to be concerned that so many people are leaving the insurance schemes,” Labour Market Minister Sven Otto Littorin told Sweden’s parliament, the Riksdag, on Friday.

Thousands of people have left the schemes since January, when the government introduced stricter qualification rules and when membership fees rose.

The insurance schemes are privately administered, mainly by trade unions, but are largely funded out of the public purse. Membership fees currently cover only a small portion of the cost of paying out unemployment benefits.

Littorin told parliament that an inquiry would be established before the summer. The inquiry would consist of independent experts rather than MPs, he said. This decision was attacked by the opposition:

“This is quite indefensible. This is a fundamental change to one of the central parts of the welfare system, so there should be a parliamentary inquiry in which unions and employer organizations can have their say,” said Left Party spokeswoman Josefin Brink. She was backed up by Social Democrats.

Brink said the Left party was fundamentally opposed to an obligatory system, which she said would weaken unions.

“The main reason for our opposition is that the link between the unemployment insurance schemes and the unions have been historically important – it’s part of the Swedish model and is one of the reasons for our high rates of union membership.”

Brink said that a compulsory scheme would mean that people tried to save money by leaving the unions instead. While unions run many insurance schemes, union membership is not compulsory to be a member of the schemes.