The Royal Ministry Of Foreign Affairs, Oslo
Press Division

Norway Daily No. 84/01

Date: 4 May 2001

PM at odds with senior Labour party and trade union leaders (Dagsavisen)

Members of the Labour Party’s executive committee and leaders of the Norwegian Confederation of Trade Unions (LO) have protested against Prime Minister Jens Stoltenberg’s rejection of a coalition government made up of the Labour Party, the Socialist Left Party and the Centre Party. Mr Stoltenberg had not cleared his position with his executive committee or with the LO before publicly writing off the possibility of a coalition. Executive committee member Grethe Fossum made her opinion clear: "For me the most natural thing would be to cooperate with the Socialist Left Party and the Centre Party," she says. The LO leadership also favours a coalition between the three parties.

Heyerdahl backed down, but battle for control of Orkla continues (Aftenposten)

Jens P. Heyerdahl’s reign at Orkla is almost certainly over. Yesterday’s annual general meeting voted overwhelmingly in favour of a Corporate Assembly which eliminates all Mr Heyerdahl’s supporters. In the end Mr Heyerdahl himself chose, rather surprisingly, to support the nomination committee’s proposal. In an interview with this newspaper, Stein Erik Hagen claimed that a board member had tried to persuade him to sell his Orkla shares in an attempt to squeeze him out of the company.

Orkla lost NOK 1 billion says Sveaas (Dagens Næringsliv)

Orkla rebel and major shareholder Christen Sveaas says that Orkla lost almost NOK 1 billion when it decided not to enforce the loan agreement it had with Kjell Inge Røkke. Mr Sveaas revealed at yesterday’s annual general meeting that the commission of inquiry into Orkla’s management had found additional assets worth NOK 5.2 billion in TRG (Mr Røkke’s holding company based in the Dutch Antilles), of which Orkla was entitled to 18-19 per cent.

Røkke proposes Gyllenhammer as new Kværner chairman (NTB)

Self-made multi-millionaire Kjell Inge Røkke will arrive at Kværner’s annual general meeting on Friday armed with proposals for an alternative board of directors. Mr Røkke’s choice as company chairman is former Volvo boss Per G. Gyllenhammer. Kværner’s nomination committee has proposed a new board with attorney Harald Arnkværn as chairman. Mr Røkke, who is Kværner’s largest shareholder, is reported to be extremely doubtful about the proposed new board. Kværner’s chief executive Kjell Almskog has therefore asked Mr Røkke to present an alternative suggestion. Mr Røkke’s alternative board was announced in a press release published by Aker Maritime shortly before midnight on Thursday.

Set to take control of Kværner – with the banks’ help (Dagbladet)

Kjell Inge Røkke has borrowed billions of kroner from Den norske Bank and Gjensidige Nor. Today the banks’ wholly-owned investment companies, DnB Investor and Avanse Forvaltning, will probably give Mr Røkke their complete backing in the battle to take control of Kværner’s assets. This support may be enough to tip the scales in Mr Røkke’s favour and bring the conflict over one of Norway’s oldest industrial concerns to an end.

Conservatives promise tax break for the highest paid (Dagens Næringsliv)

The highest paid will benefit most from the Conservatives’ proposed changes in taxation. The gradual phasing out of the high income surtax, which they are proposing, will have a dramatic impact. A person earning NOK 1 million, would pay around NOK 100,000 less in tax. Conservative Party chairman Jan Petersen will today win the party’s annual conference and urge delegates to greater effort during the election campaign. The abolition of the high income surtax would mean an annual NOK 15 billion in lost revenue for the Government. Raising the basic tax threshold could also be costly, says Nils Martin Stølen, head of research at the Central Bureau of Statistics.

Local authorities angry over Ministry’s refusal to cover increased costs (Aftenposten)

A significant rise in building costs has left local authorities facing an additional NOK 3.7 billion bill for the construction of new nursing homes and sheltered accommodation for the elderly. The Ministry of Social Affairs has refused to increase its grants to cover building costs and salaries. The grants were fixed in 1996, but building costs for a nursing home bed have risen from NOK 830,000 to NOK 1.5 million since that time. Corresponding salary costs have risen by 20-25 per cent.

Fate of additional cash benefit for under-threes to be decided after election (NTB)

At its meeting on Thursday the Storting’s Family, Cultural Affairs and Government Administration Committee decided to postpone a decision on the future of the additional cash benefit for children under three until after this autumn’s general election. Although the committee blamed its heavy workload for the postponement, the real reason is political. Until the election the political parties are bound by the position they have taken for the current parliamentary term. The five non-socialist parties are united in supporting the benefit, while the Labour Party and the Socialist Left Party are equally united in their opposition.

Worth Noting

• The organization which opposes Norwegian membership of the EU, No to the EU, has the backing of a stable majority in the country. According to an opinion poll carried out by the market research company, Sentio-Norstat, for Nationen, 56 per cent of the population would have voted against membership if there had been a referendum on the issue today. Only 35 per cent of the electorate would have voted in favour of EU membership. (Nationen)
• The good relations between the Conservatives, the Progress Party and the Labour Party over the Government’s proposed hospital reform bill have led Christian Democrat leader Kjell Magne Bondevik to abandon his plans to negotiate with Labour over hospital reform. (Aftenposten)
• The Oslo Stock Exchange is itself to go public, with shares going on sale between 8 and 21 May. The shares in Oslo Børs Holding ASA will be priced in the region of NOK 75-95 per share, which means the company’s equity capital is valued at NOK 375-475 million. (NTB)
• Knut Weum, head of LO Industri, part of the Norwegian Confederation of Trade Unions (LO), has issued a controversial challenge to the LO’s central office at Youngstorget in Oslo. Mr Weum says that in the longer term most of the LO’s administration and member union offices should relocate out of Oslo. "We have to get out and provide a service for our members," he says. (Verdens Gang)
• Preliminary figures sow that Norway had a current account surplus of NOK 18.7 billion in February this year, compared to NOK 13.7 billion for the same period last year.

Today’s comment from Dagbladet

The Labour Party and the Norwegian Confederation of Trade Unions (LO) used their May Day speeches to warn against the Conservatives and the Progress Party, and to attach the centre parties to the right of Norwegian politics. But the next day Prime Minister Jens Stoltenberg rejected any coalition with the Socialist Left Party and the Centre Party. Instead, the Labour Party intends to govern with the ad-hoc support of the various parties represented in the Storting, including the Conservatives and the Progress Party. This is the same practice which the Bondevik government relied on, and which the centre alliance parties are planning to repeat after the election. Up to now this line has been strongly criticized by the Labour Party, but now Mr Stoltenberg has chosen the same tactic. It is simply a recognition of the way things are. He came to power with the help of the Conservatives, and seeks support from the right on important issues without seeming to bat an eyelid. All the chit-chat about a majority government and a stable alliance in the Storting has finally been silenced. In that respect Mr Stoltenberg is in the same class as Mr Bondevik before him. He has made a useful pre-election clarification of his position.