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Danes must tighten their belts

| Text: Marie Preisler

Danes must work for longer to create new jobs and to secure a balanced budget by 2020. That’s the main conclusion of the Government’s 2020 plan for the Danish economy.

The plan is a platform for the government’s negotiations on its comprehensive reform programme which includes changes to cash aid, flexible jobs, early retirement, taxation and tri-partite negotiations between the government and the social partners.

Negotiations are already underway in a range of areas but nothing has yet been agreed, and the government’s 2020 plan works as a kind of master plan for the economic development over the coming eight years. It stipulates what the various reforms must cost or what value they should create.

180,000 new jobs

The main aim of the 2020 plan is to create new jobs to ensure those who are unemployed now can in future contribute to the state coffers. The government wants to create a total of 180,000 jobs. New reforms are expected to create 60,000 of them, while 40,000 are to come from reforms which have already been executed. The government expects 80,000 jobs to emerge from an upwards swing in the economy. It also wishes to maintain later years’ trend of longer average working hours, and a tax reform will, according to the 2020 plan, considerably reduce income tax and bring ten billion kroner (€1.35bn) to the state coffers.

Praise from many parties

The plan says public sector growth should be 0.8 percent a year, and as a result the 2020 plan has been praised as economically responsible by both business and the political conservative opposition - which says much of the plan copies many of its own policies. The trade union movement is happy about the fact that the government wants to increase university uptakes, but it still wants to see an increased focus on other educational policies. 

Prime Minister Helle Thorning-Schmidt admits it will be a challenge to create 180,000 new. But as she presented the plan, she underlined that the target can and must be reached:

“It is also the government’s goal that going towards 2020 we will create 180,000 jobs in Denmark. You might say that is an ambitious goal, but it is also a goal which we can reach if we take responsibility for it right now.”

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