Bondevik would rather resign than share office with Hagen (Dagsavisen)

Prime Minister Kjell Magne Bondevik has rejected all demands to include the Progress Party in his government. He would rather resign than share office with Carl I. Hagen’s party. In the past week the PM has come under heavy crossfire. The Labour Party and the Socialist Left Party want to glue the Progress Party more firmly to the Government, while the Progress Party itself thirsts for a place in the cabinet. A number of high-profile business leaders yesterday spoke up for Mr Hagen, but this had no impact on the PM. He flatly rejected the Progress Party and Carl I. Hagen as coalition partners. "Bringing the Progress Party into the Government is totally out of the question. I have said so 99 times, and may as well say it a hundredth time. That some business people might think otherwise has no effect on our choices," said Mr Bondevik yesterday.

Solberg denies local government crisis (Nationen)

Those who thought Local Government and Regional Affairs Minister Erna Solberg would show any humility away from home made a grave mistake. She arrived at the Norwegian Association of Local Authorities (KS) and claimed that there was no such thing as a crisis in the local government sector. Ms Solberg had been invited by the KS national committee to brief them on the Government’s proposed national budget. Speaking without a script, but with a large number of overhead transparencies, she claimed that local government has been given priority within a very tight framework. The fact that local authorities are nevertheless claiming to face a crisis did not make any impact on her. On the contrary, she repeated her mantra about rationalization and putting public services out to tender. Ms Solberg claimed that local authorities were undermining their own argument that they were strapped for cash by their unwillingness to experiment with competitive tendering.

Solberg blames the Storting (Aftenposten)

"It is not the Government but the Storting which is responsible for the financial difficulties facing local authorities," said Local Government and Regional Affairs Minister Erna Solberg (Con). Ms Solberg hit back at local politicians from all parties who have accused the Government of squeezing the life out of the local government sector. "The right target for that criticism is the Storting. Local politicians from the Labour Party, Socialist Left Party, Centre Party and Progress Party should consider the fact that it is their fellow party members who are behind the pre-school day care reform. This is an agreement which reduces local authorities’ influence over their own affairs and leads to greater earmarking of funds. In this way local authorities have less money to spend as they themselves think fit," she said.

LO to hit back (Klassekampen)

The Norwegian Confederation of Trade Unions (LO) is rolling out its big guns to shoot down the Government’s proposed national budget. 640,000 LO members are being mobilized for a political strike to be staged next Thursday between 2 and 3 pm. The LO’s protest focuses on four areas: substantial cuts in unemployment benefits and the rules governing temporary layoffs, a lack of initiative to combat rising unemployment, the failure of the budget to reduce the gap between rich and poor, and a tougher and more brutal workplace. The LO is relying on its own strength, and has not invited the other union confederations to join the political strike next Thursday. Both the Confederation of Vocational Unions (YS) and the Confederation of Higher Education Unions, Norway (UHO) are due to discuss the budget at their executive committee meetings today. "Much of the budget is worrying, but so far we have no plans to take direct action," said Randi Bjørgen, head of the YS.

King saved Norwegian businessmen NOK 3 million in Hungary (Dagbladet)

Norwegian businessmen have thanked King Harald for the fact that they were yesterday able to sign an agreement for a new factory with their Hungarian partners. According to the Norwegian Trade Council, the King is more important than Prime Minister Bondevik. "Without this state visit agreement would not have been reached for another two to three months. In cash terms that means that the King has saved us NOK 2 million, perhaps NOK 3 million," said Helge Rosvold, chief executive of the Norwegian company, Dtech. In partnership with the Hungarian company Nagyatàdi Konzervgyà Ltd, Dtech, which is owned by Felleskjøpet, plans to build a factory to produce dried fruit and vegetables. The project is expected to cost NOK 56 million. Each month the project is delayed costs Dtech NOK 1 million. "Our participation in the business delegation accompanying the King on his official visit to Budapest has acted like a rocket to speed up negotiations on the agreement we have just signed," said Mr Rosvold.

Statoil fears new Mongstad scandal (Dagens Næringsliv)

Statoil chief executive Olav Fjell is worried that development of the Snow White gas field could turn into another scandal along the lines of Åsgard and Mongstad. The Snow White project is already NOK 3 billion over budget. The total investment cost is estimated at NOK 40 billion. Mr Fjell does not want to suffer the same fate as his predecessors Arve Johnsen and Harald Norvik, who were forced to resign after the Mongstad scandal and the Åsgard budget overruns respectively. Mr Fjell is not satisfied with the way the Snow White project has been run so far, and has therefore decided to take responsibility for the project away from Henrik Carlsen, head of the company’s Exploration and Production Division. From now on the managers of the Snow White project will report directly to Mr Fjell’s right-hand man and chief financial officer, Inge K. Hansen.

Orkla boss rejects criticism of predecessor (Dagens Næringsliv)

Orkla’s chief executive, Finn Jebsen, sees no reason to change the work being undertaken by his predecessor Jens P. Heyerdahl at this stage, and has firmly rejected claims that Mr Heyerdahl is sticking his nose into operational decisions that no longer concern him. "There is no good reason to suggest that Mr Heyerdahl is usurping the current management team’s authority. Naturally, it is the board of directors and the chief executive who make the decisions at Orkla," said Mr Jebsen in response to remarks made by Stein Erik Hagen on Wednesday. "I would remind everyone that Mr Heyerdahl is not an employee of Orkla. He has kindly made his time available and I have asked him to undertake a limited number of projects in the areas of organizational development and corporate culture. He takes no part in Orkla’s operational decision-making, nor is he engaged as an adviser in that capacity," said Mr Jebsen.

Call for National Bureau of Crime Investigation involvement in methanol case (NTB)

The Director General of Public Prosecutions, Tor-Aksel Busch, has said he has asked the National Bureau of Crime Investigation to contact the country’s police districts to find out if the investigation into the methanol case needs central coordination. Mr Busch added that he had made the decision on his own initiative. "This case has grown in scale and we could no longer sit by and watch," said Mr Busch. The methanol case has grown steadily in size and scope, and has now spread to large parts of the country. Six people are thought to have died after drinking illegally imported alcohol contaminated with methanol. A further 25 people have required medical treatment.

New legislation needed to break up local authority pensions monopoly (Aftenposten)

According to law professor Erling Selvig of the Banking Law Commission, all insurance companies must be given the right to offer local authorities the same products as the municipal pension fund, KLP, in order to secure free competition with regard to local government pension schemes. Professor Selvig has led the Commission for the past 11 years, and there is practically no one who has had more influence over Norwegian financial services legislation during this period. Professor Selvig now wants to ensure that the Norwegian Union of Municipal Employees’ victory in the Industrial Disputes Court on Tuesday does not create a complete monopoly on public sector pensions. "In the view of the Banking Law Commission, a level playing field for all participants in the market is extremely important," said professor Selvig.

1. Worth Noting

• There are no indications that alcohol smugglers have been put off by death and illness among their customers. On the contrary, customs officers believe that alcohol smuggling will increase in the run-up to Christmas.
  (NTB)
• Prime Minister Kjell Magne Bondevik would like to have a dedicated government plane, but does not want to use the aircraft already owned by the Civil Aviation Authority. This is because the PM wants a jet plane, not one with propellers. "The reason we want a jet is that a propeller-driven aircraft has a shorter range, slower speed and produces more noise inside the cabin," said Øivind Østand, the PM’s chief press officer.
  (Dagens Næringsliv)
• While the spotlight rests on Stein Erik Hagen’s new role as Orkla’s major shareholder, the real business is going on behind the scenes, and billions of kroner are at stake. The issue revolves around the pricing of Mr Hagen’s stake in the Scandinavian supermarket chain, ICA Ahold. Mr Hagen claims to have an agreement with the Dutch company, Royal Ahold, which entitles him to a premium worth billions on top of the shares’ market price if he demands to be bought out in 2004. Royal Ahold, for their part, believe that paying the market price should be enough.
  (Aftenposten)
• Telenor risks being hit by a huge tax bill not only for last year, but for this one too. The total tax bill could amount to NOK 5.6 billion.
  (Dagens Næringsliv)
• Today, the number of Norwegians expressing concern about the number of refugees and asylum seekers coming to this country has doubled compared with 1999. In 1999, 23 per cent of those questioned said that Norway had accepted too many refugees and asylum seekers. Today, 48 per cent are of the same opinion, according to a survey carried out by TV2.
  (NTB)
• In last night’s TV2 documentary programme, The State of the Nation, it was alleged that the youth organization, Norsk Målungdom, had invented fictional local organizations and fraudulently inflated its membership numbers in order to qualify for millions of kroner in public grants to which it was not entitled. Einar Høgetveit, head of the National Authority for Investigation and Prosecution of Economic and Environmental Crime, said that he had been aware of the allegations for over a year. "However, we have not had the documentation which TV2 has now uncovered," he added.
  (Aftenposten)
• Children and Family Affairs Minister Laila Dåvøy has said that if TV2’s allegations that the youth organization, Norsk Målungdom, fraudulently inflated its membership numbers prove to be correct, she wants those responsible investigated and punished. Ms Dåvøy has contacted Minister of Justice Odd Einar Dørum, and hopes that the National Authority for Investigation and Prosecution of Economic and Environmental Crime will investigate the case.
  (Verdens Gang)

2. Today’s comment from Aftenposten

Norway’s local authorities are not permitted to sign up with the pension insurance provider of their own choice, but are obliged to use the municipal pension fund, KLP. This is the consequence of Tuesday’s decision by the Industrial Disputes Court, after its longest and most expensive case ever. The Court has done its job and found out that when it comes to pensions provision, local authorities’ freedom to choose violates established collective tariff agreements. This does not mean that the Court’s decision is sensible. To force financially strapped local authorities to use a pension fund that has accumulated a deficit of almost NOK 3 billion over the past 18 months, and which has therefore forced its local authority owners to stump up an additional NOK 2.5 million in extra premiums, can never be sensible. Fortunately, the Storting has realized this. Local Government and Regional Affairs Minister Erna Solberg has issued assurances that the Norwegian Union of Municipal Employees will derive little benefit from its court victory. The Storting decided as long ago as April to override the Industrial Disputes Court if it came to the conclusion that transferring local authority pensions represented a violation of collective tariff agreements. In practice this will probably be done under the auspices of the Banking Law Commission, whose proposals are due to be handed to Finance Minister Per-Kristian Foss before Christmas. The Commission’s leader, professor Erling Selvig, is reported in today’s Aftenposten as saying that the starting point is crystal clear. The legislation regulating the insurance industry should not prevent free competition. The KLP decision is simply an extremely temporary conclusion to a long-running dispute, which has been considered not only by the Industrial Disputes Court, but also by the EFTA Surveillance Authority (ESA), the Norwegian Competition Authority, the Banking, Insurance and Securities Commission, government departments and the Storting. We hope and trust that this matter will finally be laid to rest in a competitive-friendly way after Christmas.