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Sweden’s government crisis means less money for working life

| Text: Gunhild Wallin

On Wednesday 3 December Sweden’s Prime Minister Stefan Löfven announced snap elections will be held on 22 March 2015. His centre-left minority government’s budget was voted down in parliament, which also means the promised increase in spending for the Public Employment Service and the Work Environment Authority will not materialise.

“This means we cannot expand our inspections like we probably could have done with more money. But we will continue to do our job, since our mission remains unchanged,” Director General at Swedish Work Environment Authority Erna Zelmin-Ekenhem told Swedish Radio. 

As a result of the government’s budget defeat and the voting through of the centre-right opposition budget proposal, there will be less money for labour market and working life measures. The Swedish Public Employment Service looses out on more than 500 million kronor (€53.8m) in administrative support. There will be no money for various work creation measures either. The  Swedish Work Environment Authority is loosing out on funding worth 100 million kronor (€10.7m). The Authority has seen cuts to its funding in the past few years, which has led to fewer work environment inspections. This fact got a lot of attention recently, after two construction workers died while working on a project in Stockholm.  

Pensioners hit

Other work place investments which will now not be implemented include higher unemployment benefits and new investments in working life research, as promised in the government programme. Retired people on lower pensions will also not be seeing a promised tax relief, and there will be no increase in sick pay.

Special investments in geriatric care and education, including a planned increase in teachers’ wages, will also fall by the wayside. However, tax relief for certain domestic work, the so-called RUT relief, will remain in its current form. The government had announced they would cut the tax relief for homework help, but this will now remain, along with a 50 percent cut to the payroll tax for young employees. 

The budget has been hanging like a dark cloud over the centre-left government since it came to power after September elections. It was immediately clear that the parliamentary make-up would be problematic, as Stefan Löfven’s Social Democrats were tasked with forming a government. None of the traditional political blocks secured a parliamentary majority, and the Sweden Democrats (SD) held the balance of power.  

For a long time they did not say how they would vote on the budget, but during a live press conference the day before the vote the SD leadership announced that the opposition’s budget proposal would get their vote. The party spokesman Mattias Karlsson also made it clear that they would vote down any future budget from any government which did not want to cut immigration. 

"A serious situation"

That same evening Stefan Löfven asked the four parties on the centre-right to join talks to try to solve the difficult situation, but no agreement was reached. The following day, on 3 December, the Swedish parliament voted through the opposition’s budget. Later that day, a clearly disappointed Stefan Löfven told a press conference that he would announce snap elections.

“Sweden is in a serious situation. On 29 December the government will call new elections. And we do this to allow voters to make a decision on the new political landscape which has emerged,” said Prime Minister Stefan Löfven.

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