TOUGH BUDGET NEGOTIATIONS IN STORE (Aftenposten)

The Stoltenberg government’s budget proposal will hit business hard. But the surprising proposal to introduce a business cycle tax, which will cost the commercial sector NOK 6.8 billion, has been met with strong resistance from both business leaders and opposition parties in the Storting. Only Norwegian Confederation of Trade Unions leader Yngve Hågensen has praised the budget. Petrol, spirits and meat will be cheaper next year, but this is far from enough to appease the critics. In other areas the Government will tighten people’s household economies. The electricity tax is being raised, VAT is being introduced on a number of services and financial support for families with children will be reduced.

FRIENDLESS FINANCE MINISTER IN THE STORTING (Dagsavisen)

Just minutes after the Labour Government’s budget proposal was announced, the other parties started their attack on most of its contents. Carl I. Hagen called the whole budget an "offer of resignation by the Government". The parties of the centre alliance also criticised the business cycle tax and demanded that VAT on food be cut by half. The Labour Government must now prepare itself for a rough ride in the Storting. The whole budget depends on the business cycle tax proposal. However, though the Finance Minister met with strong criticism from the opposition, he was applauded by the party’s own supporters.

SURPRISE (Vårt Land)

The leaders of the centre alliance parties were surprised by the budget, which was presented yesterday. Instead of fighting over a few billion kroner for VAT on food, they discovered that the Government intends to impose a business cycle tax which will cost Norwegian businesses several thousand kroner for each employee. "He’s not very good at winning friends," was the comment from the centre alliance parties after the Finance Minister had finished presenting the budget.

SACRIFICED TO RESTORE CONFIDENCE (Dagbladet)

Storebrand had no choice but to get rid of CEO Åge Korsvold. He refuses to admit that he has done anything wrong, and yesterday morning was still determined to keep his job. "I admit that issues concerning my personal affairs have contributed to a weakening of confidence in Storebrand," said Korsvold – without acknowledging that it was wrong of him to agree to the controversial stock option deal. On Tuesday the Board of Directors gave Mr Korsvold their full support. A day later they gave him the sack – without any new information having been brought to light.

NOK 10 MILLION OFF THE HOUSE PRICE (Dagens Næringsliv)

Åge Korsvold is to receive a substantial leaving present from Storebrand. He is being allowed to buy the company’s fashionable house, including artworks and designer furniture, for NOK 15.5 million. The completely renovated detached house has cost Storebrand in the region of NOK 26 million. In addition Korsvold is getting a golden handshake and pension scheme worth NOK 6 million.

CAN BE RISKY TO COMPLAIN ABOUT SOCIAL SECURITY PAYMENTS (Aftenposten)

From now on, people who complain about their social security payments may run the risk of getting their payments cut, according to proposed new legislation. The aim is to halt the rise in costs. The National Insurance Appeals Council currently does not have the right to make decisions that leave social security claimants worse off. Minister for Social Affairs Guri Ingebrigtsen justifies the proposal by pointing to the substantial increase in the number of people receiving disability pensions and the size of payments.

WORTH NOTING:

• Children, the elderly and the sick will be better off. Jens Stoltenberg is sending the bill, amounting to several billion kroner, to Norwegian businesses, shareholders and the highly paid. (Dagsavisen)

• The meat processing industry says that consumers will not see any benefits from the reduction in VAT on meat. The Government’s contribution to lower food prices in 2001 will amount to NOK 250 million, in a market worth NOK 100 billion.

• The Labour Party’s budget proposal is so unpopular with the other parties that it may cause the Government’s downfall. In that case Kjell Magne Bondevik stands ready to take over and the centre alliance will get its revenge. (Dagbladet)

• Norwegian Confederation of Trade Unions leader Yngve Hågensen is using the revelations surrounding Storebrand boss Åge Korsvold’s stock options to defend the Government’s proposed business cycle tax. (Dagens Næringsliv)

• Norwegian business leaders see the budget at a declaration of war and promise to mobilise against it. But their only weapon is "dialogue". (Aftenposten)

• The chairman of Storebrand’s Corporate Assembly, Svein Ullring, yesterday evening refused to say whether he still had confidence in board chairman Jon R. Gundersen. (Aftenposten)

• The private sector may be drained of employees to make room for more jobs in the public sector. In next year’s budget Finance Minister Karl Eirik Schjøtt-Pedersen paving the way for a substantial weakening of Norwegian businesses’ competitiveness. (Dagens Næringsliv)

• Norsk Agip has made a major oil discovery 85 km north of Hammerfest. The Petroleum Directorate estimates the find at 25-40 billion cubic metres. Finnmark has waited for over 20 years for the discovery of a viable oil deposit and now their optimism is increasing. (Aftenposten)

• The amount of plastic dumped in Norwegian rubbish tips is steadily increasing. Each of us throws away 30 kg more than we did in the eighties. Over half of the plastic waste comes from private households. (Dagsavisen)

• While the number of wolves in Norway has risen sharply, the number of sheep killed has fallen correspondingly. In the county of Østfold – which contains Norway’s largest wolf population, wolves have killed only eight sheep this season. (Dagbladet)

TODAY’S COMMENT FROM DAGSAVISEN

There is nothing sensational in the fact that business leaders have become uncommonly greedy in their efforts to enrich themselves. It seems as though many of them have forgotten which society they are living in. At the very least they have lost their sense of reality. It may be they have begun to believe that they are invincible and that moral and legal norms no longer apply to them. Something of that kind must have happened to Storebrand’s Åge Korsvold, who is otherwise both sensible and good at his job. That he has been greedy is not a sensation. In his circle, they all are – and he is probably not the worst. But that he and Storebrand’s Board of Directors should believe that he could get away with a series of obviously unlawful stock option deals, almost beggars belief. He simply had to resign. This scandal shows that the game of power and influence is just as cynical and ruthless in the business world as it has ever been in politics.

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