New outside-the-parliament government

   Mar 14, 2024     2 min read

It didn’t happen that the government burst as many had expected. Neither because of the whaling issue, immigration matters, bank sales, police militarization, nor other issues that have been difficult for the government. Instead, we just got an informal caretaker government until the next election.

We have just signed wage agreements with a large part of the general labor market, which at the same time sends a bill of 80 billion krónur to the Treasury over the next four years. And then there’s still the completion of wage negotiations with public sector employees. Despite various ministers saying over time that the state is not a party to wage agreements in the general labor market, it has turned out otherwise; the state seems to be the third party in these negotiation talks.

This is strange because just over 2 months ago, the government approved the budget for this year. About 17 billion were set aside in a contingency fund to cover upcoming wage increases, simply because the government had no idea what demands the labor market was going to make in wage negotiations. But why does the state need to know this when the authorities are not supposed to be parties to agreements in the general market in the first place? What’s so twisted in all this is that by not making decisions on appropriations for social infrastructure, the government is essentially putting that decision in the hands of negotiators in the general labor market. And then we have to ask ourselves, who really controls the state budget in reality?

Politicians and parties offer themselves with a certain policy and objectives. If the policy is that the parties of the labor market just decide, then what’s the point of parliamentary elections? When the government starts outsourcing decisions to others, what then is the purpose of the current government at all? The same decisions would be made without them.

But then we come to the question of how exactly to pay for this. Perhaps one might say that the funds are already there, 17 billion had been set aside in the general contingency fund. There’s probably some double counting so we might end up with a slightly lower bill than the talked-about 80 billion. Let’s assume then that the total cost is these 17 billion that have been set aside. Then there’s nothing left for public employee wage increases, and since our new outside-the-parliament government, i.e., the parties of the labor market, doesn’t have proposals on how to finance these new wage agreements, we have to look to the government for that, or probably others since this government is unlikely to solve it.