When PM Mette Frederiksen opened Parliament yesterday, she spoke a lot about improving welfare, the climate and setting aside more funds for the public sector.
Today, the government revealed its new 2020 budget strategy proposal (here in Danish), the key points of which include more money for nurses, the police, public sector, green innovation and welfare.
More specifically, the government wants to earmark 300 million kroner for more nurses and 1.2 billion kroner annually for the police over the next four years.
Another 1.5 billion kroner is to be set aside to revamp the tax authority in 2020, while 1 billion kroner will go to green research.
A further 147 million kroner is set aside for a railroad across west Funen – the total price of which is estimated to cost 4.9 billion kroner.
Scaling back Lars Løkke
In terms of increased welfare, a big sticking point with the new government, municipalities will receive an additional 2.2 billion kroner, while the regions – which operate the hospitals – will see another 1.5 billion kroner.
The government also wants to axe saving cuts in the education sector, including shelving the re-prioritisation contributions to higher education plans, which the previous government had sought to introduce.
To help fund the changes, the government wants to increase tobacco prices so that the price of a pack of cigarettes will go up by 10 kroner by 2021 – up 5 kroner in 2020 and another 5 kroner the following year.
The government also wishes to re-introduce the tax payable on employer-paid phone and internet – something that the previous government removed last year. Some 580 million kroner annually is expected to be generated by doing so.
Another billion kroner is expected to be obtained by axing the previous government’s decision to reduce the tax that is payable when family-owned companies are inherited.
Another plan is to double the fee for plastic bags and disposable products – something that is believed will generate 195 million kroner in 2020.
Allied feathers ruffled
The government also wants employers to pay more sick-day money. Currently, the state refunds sick-pay to employers if an employee has been ill for over 30 days. In future that will be increased to 40 days and state coffers are predicted to benefit from the move with a 500 million kroner windfall.
The government wants to retain the 50,000 kroner ceiling on share savings accounts – a ceiling that the previous government wanted to increase to 200,000 kroner. That’s expected to generate 60 million kroner next year and 140 kroner annually from 2022.
The government now needs to sit down with its allies within the red bloc (Socialistisk Folkeparti, Radikale and Enhedslisten) to negotiate the proposal. The finance minister, Nicolai Wammen, has 2.1 billion kroner at his disposal to help appease the demands of the support parties.
But if Frederiksen thinks the negotiations will run smoothly, she might be in for a rude awakening.
The support parties have already lambasted the proposal for being too weak on climate initiatives – one of the key points of her election platform. Key business advocacy associations are also expected to fight some of the proposals.