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The 2016 Spring Budget in five minutes
Building our society – responsibility, security and development
The Government is today presenting its proposed direction for economic policy ahead of the Budget Bill for 2017. The Government’s priorities – jobs, schools and climate action – remain firm. In addition, proposals are presented to increase funding in the budget for 2016 to address the refugee situation. The Spring Fiscal Policy Bill and the proposals in the spring amending budget are based on an agreement between the government parties and the Left Party.
Swedish economy and public finances
The prospects for the Swedish economy are good. However, the economic forecast is uncertain and there is a substantial risk of a weaker outlook.
Strong recovery in Sweden...
The Swedish economy is recovering rapidly from a long period of low resource utilisation. GDP growth was high in 2015 and is expected to remain high also in 2016. As resource utilisation rises, GDP growth is expected to slow somewhat in 2017.
...and falling unemployment
Unemployment fell significantly in 2015 and is now at around 7 per cent. This is the lowest level of unemployment for seven years. As a result of the strong growth in demand, unemployment is expected to continue to fall to 6.3 per cent in 2017.
Stronger public finances in the long term
The Government has adjusted fiscal policy along more responsible lines, and the deficit has fallen sharply since the Government took office. The large number of asylum seekers reaching Sweden in 2015 and the investments being made to enable new arrivals to quickly establish themselves in society and the labour market involve temporary costs that weaken general government net lending in the short term. General government net lending is therefore expected to improve later in the forecast period than previously assumed. The deficit in the general government finances is expected to increase up to and including 2017.
Due to the favourable economic situation and the fiscal policy pursued, net lending will grow as of 2018. A surplus of 0.7 per cent of GDP is expected in 2020.
Proposals in the spring amending budget
The current situation has given rise to needs in a number of areas that will be addressed this year. The Swedish Migration Agency will receive a significant increase in appropriations to manage the large number of asylum seekers.
As more people seek asylum, more asylum cases end in rejection. Return activities will be improved.
To facilitate introduction, funds will be allocated for language initiatives and skills assessment for asylum seekers, and skills validation of new arrivals. A new fast track for newly arrived entrepreneurs will be introduced.
The Swedish Police will receive increased resources, community police will be strengthened and efforts to combat hate crimes will be prioritised. Anti-terrorism efforts will be enhanced, including through increased resources to the Swedish Security Service. In addition, resources to the Swedish Migration Agency will be reinforced to increase security at asylum centres.
Preventive action to protect our open society against violent extremism and racism will be strengthened.
The direction of fiscal policy
"In the spring budget, the Government continues to address the refugee situation and sets out the future direction – building our society takes precedence over new tax cuts. With the Swedish model as a foundation and modernisation as a tool, we will respond to the challenges our country is facing. Unemployment must be fought, pupils' learning outcomes strengthened and climate emissions reduced," says Minister for Finance Magdalena Andersson.
The Government's objective that Sweden will have the lowest unemployment rate in the EU by 2020 remains firmly in place. Investments in job creation will be made under the Government's jobs agenda. These include skills, education and matching initiatives, investments for the future including in housing and infrastructure, and an active business policy for more and growing companies. Welfare investments are also an important part of employment policy.
Providing equitable knowledge-based education and time for each pupil
Central to building our society is an equitable school system that gives every child the opportunity to develop. The main focus is on boosting learning outcomes through early intervention, enhancing the attractiveness of the teaching profession and improving equity in education.
Tightening up climate policy
Sweden aspires to be one of the world's first fossil-free welfare nations. Climate change is the Government's top environmental priority. To lead global development, Sweden is taking further steps to tighten up its national climate policy and reducing emissions.
Strengthening welfare and increasing equity
The Government's objective is that everyone will benefit from Sweden's growth and prosperity. The Government prioritises building a society in which welfare is strengthened and opportunities are made to employ more people in welfare services.
Increasing equality between women and men
The Government will continue its efforts to ensure gender mainstreaming in all areas of policy-making and is also implementing special initiatives.
Passage of the spring budget through the Riksdag
After the Spring Fiscal Policy Bill and the spring amending budget have been presented to the Riksdag, the members of the Riksdag have two weeks to present motions in response to the Government bill, with alternative proposals. Proposed guidelines for economic policy and budget policy included in the Spring Fiscal Policy Bill are processed by the Committee on Finance. The proposed amending budget, including changes in appropriation frames, revenue estimates and legislative proposals, if any, is also processed by the Committee on Finance. The Riksdag will then vote on the bill in June.