‘The Swedish model can continue to deliver’

Sweden's finance minister Magdalena Andersson presented the government's spring budget proposal on Tuesday as it upgraded growth forecasts for the next couple of years.

'The Swedish model can continue to deliver'
Finance Minister Magdalena Andersson. Photo: Fredrik Sandberg/TT

The government expects GDP, one of the key indicators used to gauge the health of a country's economy, to grow by 2.6 percent this year, 2.1 percent next year and 2 percent in 2019.

“By pursuing a responsible fiscal policy since taking office, we have succeeded in bringing the huge public finance deficit we inherited back to surplus each year of this electoral period. This has placed us in an entirely new position and offers us new opportunities to meet social challenges. The Swedish model can continue to deliver,” said a confident finance minister before presenting the budget proposal to parliament.

Unemployment is expected to reach 6.6 percent this year and drop to 6.4 percent in 2018 and 6.3 percent the following year.

“Unemployment has fallen considerably since 2014 and is expected to continue to fall over the next few years. The employment rate of people aged 20-64 is now the highest ever recorded in the EU. Youth unemployment is the lowest in 13 years and long-term unemployment has fallen; Sweden now has the lowest long-term unemployment rate in the EU, together with Denmark,” said the finance ministry.

The budget surplus puts the centre-left Social Democrat-Green coalition government in a strong position ahead of Sweden's next general election in autumn 2018, said experts.

“It's good growth and that creates good conditions for the government. It could not have been better, and then you hand this out a little by little so that everyone is happy,” Annika Winsth, economist at Scandinavian banking giant Nordea, told the TT news agency.

Swedbank's economist Anna Breman echoed her comments. “There's a lot of election slogans,” she said. “Then there's focus on the labour market, knowledge, climate, equality and security.”

The centre-right opposition however accused the government of having too rosy an outlook. Jakob Forssmed of the Christian Democrats said the finance ministry was not doing enough to plug widening gaps in the labour market, where unemployment is growing among foreign-born and disabled people.

“The biggest gap is between those who have a job and those who do not, and that's why it is surprising that the government isn't doing more about it,” he said.

The Moderate Party's finance spokesperson Ulf Kristersson argued in a parliamentary debate on the budget that there could be trouble on the horizon. “It is not the government's tight, active finance policies that have led to better finances, but rather that we've gone from recession to an econonmic boom. If we were to get a new crisis, we would have dramatic deficits. Better savings are required during an economic boom.”

The key points in the government's spring budget proposal include more money for maternity care, mental health care for children, climate investments and the police, as well as higher taxes for those on medium and high incomes and lower taxes for pensioners.

The spring budget is an extension of the main autumn budget. In Sweden, all governments have the chance to revise their annual budget each spring, to adapt to events or economic changes that have emerged since the start of that year. It will need parliamentary approval.

READ ALSO: Five key points about Sweden's spring budget

READ ALSO: Funding boost won't save closed Swedish maternity ward


Five of Sweden’s political parties planned to evade party financing laws

Five of the eight political parties in the Swedish parliament discussed evading party financing laws with a businessman secretly working with journalists, a new investigation by broadcaster TV4 has found.

Five of Sweden's political parties planned to evade party financing laws

“There’s every reason to demand moral and political responsibility,” political scientist Jonas Hinnfors said of how Sweden’s society should react to the investigation’s findings. “It’s a threat to democracy.”

The new law on donations to political parties which came into force in 201  dictates that parties must declare all donations received from private individuals or businesses. Donators can remain anonymous, byt only as long as their donation does not exceed 24,150 kronor (€2,281). Larger donations must be declared along with the name of the donor.

The Kalla Fakta team which produced the documentary hired two businessmen to call each parliamentary party and ask how they could donate half a million kronor, while staying anonymous. The conversations were recorded and meetings filmed with a hidden camera.

Three parties – the Centre Party, the Left Party and the Green Party – said that it wasn’t possible for the donor to remain anonymous. 

But the other five parties – the Social Democrats, the Moderates, the Sweden Democrats, the Christian Democrats and the Liberals – suggested different ways of getting around the requirements.

Christian Democrat press secretary Peter Kullgren suggested splitting up donations and donating to individual candidates so that each donation remained under the legal limit.

Another method, proposed by Sweden Democrat head of finance Lena-Karin Lifvenhjelm, consisted of giving the money to another individual who would donate it under their name instead.

Magdalena Agrell, the Social Democrat’s head of finance, discussed finding someone else to act as a front in recorded telephone conversations.

The chairman and communications chief of the Social Democrat’s youth organisation, Diyar Cicek and Youbert Aziz, suggested that the businessman instead create a foundation to donate the money.

The Moderate Party’s ombudsman Patrik Haggren proposed that donations could be sent from different members of the businessman’s family in order to remain anonymous.

Lisa Flinth, who is responsible for leadership support in the Liberal Party, also proposed this method, providing the contact details of a middleman, the consultant Svend Dahl.

Dahl first proposed that his company send an invoice of half a million kronor to the businessman, but later suggested that the money be transferred to him to donate to the Liberals in his name, thereby avoiding having to pay tax.

“It’s important you keep yourself anonymous,” Dahl said in Kalla Fakta‘s recordings of conversations with the undercover businessman.

Dahl is a political scientist and has previously been head of media organisation Liberala Nyhetsbyrån.

Flinth was well aware of the fact that the method undermines the aim of the law, telling the businessman in a telephone conversation that it was very important that nothing could be traced back to the party.

“It could have serious consequences,” she said. “We don’t really have any margins when it comes to credibility.”

“If there was an article about this in the middle of a heated election campaign and we miss the threshold for getting in to parliament, I would never forgive myself,” she said.

Political scientist Jonas Hinnfors, who commented on the conversation for the Kalla Fakta team, said he was shocked after hearing it.

“They know what the point of the new legislation is,” he told Kalla Fakta. “Going against that is political dynamite.”

In a written comment on their website, the Liberals’ vice-party secretary Gustav Georgson stated that the party would not use Dahl’s consulting services again and that it “takes the statements made by Kalla Fakta seriously and will act forcefully to avoid similar situations happening again.”