Largest tax cut ever (Dagens Næringsliv/Saturday)

Never before have we seen such a large cut in direct and indirect taxes from one year to the next as that proposed by the Bondevik government in its revised national budget, which was announced yesterday. Even the tax cuts included in the tax reform of 1992 were not as large, measured in nominal values. Taxes are being cut by a total of NOK 11.8 billion. But despite its record size, the cut does no more than compensate for the increase in taxes from last year to this.

Crumbs for Progress Party (Dagsavisen)

The Progress party is thought to have gained acceptance for free medicines for the elderly and those receiving disability benefits, and for the abandonment of plans to cut NOK 400 million off government subsidies for medicines prescribed for chronic ailments, so-called "blue prescriptions". But the Progress Party’s Siv Jensen had nevertheless got herself extremely worked up following yesterday’s budget negotiations with the three governing parties. "Our patience has been sorely tried. If the Government do not come up with a more constructive attitude at the meeting on Monday, I really cannot see how we can go any further," said Ms Jensen, chairman of the Storting’s Finance Committee. Ms Jensen is frustrated that the governing parties are only offering crumbs to the Progress Party.

Budget debate marks time (Aftenposten)

The coalition government’s chief negotiator, Jan Tore Sanner (Con), is completely unruffled by it all. "We know Siv Jensen and the Progress Party already. We are prepared for some tough negotiating, but we are still willing to go some way towards meeting the Progress Party’s demands," said Mr Sanner. At the same time he repeatedly underlined the necessity of keeping what he described as the "tightness" in the budget in order to "pave the way for a cut in interest rates".

Competition over the poor (Vårt Land/Saturday)

The Government and the opposition parties are embroiled in an unseemly competition to claim the title, Champion of the Poor. Yesterday the Bondevik government presented a budget including an additional NOK 250 million for the poorest sections of society. "I am proud that this government is getting to grips with the issue of poverty and has presented measures to alleviate it," said Prime Minister Kjell Magne Bondevik. "The rich are the winners," according to the Labour Party, the Socialist Left Party and the Centre Party.

Conservatives largest – Labour lose support (Aftenposten/Sunday)

The Conservatives have gained 4.7 percentage points since the new coalition government came into office, and are once again the country’s largest party with the support of 25.6 per cent of the electorate. Labour has dropped 1.3 percentage points to 22.3 per cent since October. The Christian Democrats have also recorded a slight gain (0.6 percentage points), while support for the Liberals has fallen by 1.2 percentage points.

Norwegian People’s Relief Organization in deep trouble (Dagsavisen/Sunday)

The Norwegian People’s Relief Organization’s chairman, Reiulf Steen, has confirmed that the trade union movement’s humanitarian aid organization is in deep financial trouble, and has announced dramatic cuts. The Norwegian People’s Relief Organization is to axe 50 out of 130 jobs, and will reduce the number of projects it is involved in both in Norway and abroad. "We have stretched ourselves too thin," admitted Mr Steen. However he denied that the organization was in danger of going bankrupt. Last year the Norwegian People’s Relief Organization made a loss of NOK 10 million.

Worth Noting

• When Trond Giske (Labour) stepped down as Education Minister he left behind him almost 40 applications to open private schools. Mr Giske denies that he deliberately dragged his feet over the applications. The Education Ministry’s new Conservative leadership believes four months is sufficient to process such applications, and is therefore expediting the matter. (Dagsavisen)

• Prime Minister Kjell Magne Bondevik would like his government to be remembered for having taken the problem of poverty seriously. The Government’s budget proposal contains a ‘poverty package’ worth NOK 250 million, and tax cuts worth NOK 12 billion. (Dagens Næringsliv)
• Justice Minister Odd Einar Dørum has affirmed that Norway is taking part in a war against Osama bin Laden. The Government nevertheless estimates that the risk of suffering a terrorist attack is low. "We are taking part in a war against terror, but we are not at war in the traditional sense," said Mr Dørum. (Dagbladet/Saturday)
• If a diesel train were to derail in a tunnel and start to burn, eight out of ten passengers would die, according to a risk analysis. If the train were electric things would not be a whole lot better – 65 per cent would die. The state-owned railway company, NSB, commissioned the analysis but is not using its conclusions when planning safety measures. NSB says that the risk of such an accident happening is too small. (Aftenposten)
• During the spring of 2000, 22 companies dreamed of a glowing future on the stock market. 14 of them have still to be listed. Two of them never will be – they have gone bust. All eight of the companies which did manage to get themselves listed have experienced a substantial fall in their share prices. (Aftenposten)
• In the years to 2010 Norway’s population will rise by 4.3 per cent. But not in the regions, which stand to lose 4.3 per cent of their inhabitants. (Nationen)

Today’s comment from Aftenposten

The list of demands presented by the Progress Party to the three coalition partners ahead of the budget negotiations which started yesterday was worse than anticipated. Unfortunately the demands show that despite its new status as the Government’s leading collaborator and Siv Jensen’s new responsibilities as chairman of the Storting’s Finance Committee, the Progress Party is still a populist party with an irresponsible attitude to crucial economic policy linkages. The Progress Party has put a squeeze on the Government which it is vital that the coalition partners manage to withstand. They must not give in to demands which presuppose the use of billions of kroner more from the Government Petroleum Fund than both the former and the current government are agreed on. At all costs, they must stand by their own goal of pursuing economic policies which give room for a cut in interest rates. The coalition partners’ trump card is that the Progress Party would reduce its chances of exerting influence if it brings the Government down. That card must be played if necessary to avoid falling into the trap of irresponsibility into which the Progress Party is attempting to lure the Government.