– This is not the time for “Iron Erna”

– Erna Solberg (H) in her time as city minister was proud to be called “Iron-Erna” because she was very good at cutting budgets. This is not the right time to find Iron-Erna, “Sp Trygve Slagsvold Vedum leader told Dagbladet.

The SP leader is concerned about whether the municipalities will be covered by the financial losses they have had in relation to the crown crisis. This was promised in the second crisis package that the Storting adopted earlier this spring.

But now the government has established a working group to calculate how the crisis affects municipal finances. They will reach their conclusions only in April of next year.

– I’m not helping now

– A working group is fine, but it does not help the old woman who needs a nursing home now. Anyone who has contact with mayors around knows that they are not sure if the budgets will be balanced and say they will reduce costs. Municipalities must get enough funds now, says Vedum, referring to the revised National Budget (GNI) presented by the government next Tuesday.

Municipalities spent a lot of extra money during the crown crisis. Additionally, they lose large tax revenues as a result of layoffs and record high unemployment.

Vedum fears that this goes beyond people’s services, and also exacerbates the crisis by putting maintenance projects on hold that could help keep the wheels running.

– Isn’t it good to calculate how the crisis really impacts the municipal economy?

– The government has a large number of municipalities that enter continuously. If they get a trillion too much under presumption, it’s much better than if it’s a trillion too small. Then it can be used for the necessary maintenance of schools, nursing homes and roads in the municipalities. Unlike the money that is now distributed in state crisis packages, this is money that we are 100 percent sure will benefit the community, he says.

Billion loss

The Municipal Sector Organization (KS) is also concerned. They have performed calculations showing that county municipalities and municipalities have incurred additional expenses and loss of income totaling between NOK 18-27 billion.

For municipalities, the figure ranges from NOK 12.5 to 20 billion.

– So far they have been compensated by about six. We expect there will be considerable compensation on Tuesday, KS President Bjørn Arild Gram tells Dagbladet.

He says there is now uncertainty around the municipal sector and a danger of slowing down.

– That’s what the government and Storting have said is the opposite of what they want. It will have a negative impact on business and reduce services that have nothing to do with the crown. But that has consequences for people’s lives, says Gram.

He says it is positive that the government has announced that they will bring a package of measures of at least NOK 4 billion to the municipalities, but they fired enough.

However, it does not escape that the amounts are large and most are not compensated, says Gram.

– To line up

City Minister Nikolai Astrup disagrees with the description of the crisis and recalls that municipalities have already received NOK 6.5 billion in increased transfers, in addition to benefiting from the fact that the tax on employers was reduced from 12 to 8 percent as a crisis measure in October.

“I have been very clear that the government should establish and ensure that municipalities can provide good services,” he tells Dagbladet.

– There are also reasons to believe that growth in wages and prices will be lower than budgeted, which will free billions for the municipalities, he points out.

He believes it is important to get an overview of the effects of the crisis:

– Some municipalities are more seriously affected by the crisis than others. That is why it is important to thoroughly analyze additional expenses and loss of income. That is why we have established a working group, together with KS, he says.

Astrup points out that KS’s estimates of what the crisis will actually cost last many billions.

“It is very uncertain, we need a better basis to know if the measures we are taking are working well enough,” says the Minister of Local Government.

– Booms

He thinks Vedum is booming with his criticism and gives the wrong picture of the situation in the Municipality-Norway exactly

“No municipality suffers from a serious shortage of money,” he says, and continues.

– It is important to take the right measurements at the right time. The government is working on a package to start the wheels. We do not have endless money in this country and we cannot, at a time when we have the full brake, also give full gasoline.

– It is not important that the municipalities now have the security that they will be covered by their budgets so that they do not stay?

– We are very clear that we will stand up. But we are at the beginning of the crisis and we do not know how big the consequences will be. It gives a sense of security to the municipalities that we have not finished compensating. If more needs to be paid, the government has shown its willingness to make proposals on an ongoing basis. I expect normal operation as much as possible. Municipalities should not postpone or cancel the projects that were planned, as this could help quell the crisis, he says.

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