Danish government makes welfare, climate pledges in 2020 budget proposal

With the budget proposal now complete, the minority government must negotiate a final deal with its allied parties on the left. Generally, a final budget is passed by parliament in December.

As the government had promised prior to Wednesday’s presentation, climate and welfare were both given priority in the proposal.

Here is a summary of some of the key elements of Wednesday’s budget proposal.

Climate

• Double the price of plastic and paper carrier bags and disposable cutlery. The supermarket price of a plastic bag would be 50 øre (half a krone) under the proposal.
• One billion kroner is earmarked for spending on research into green technology and conversion, including on climate change research and agriculture.
• Over half a billion kroner of Denmark’s foreign aid contributions to be prioritized on green initiatives.

Welfare and society

• 2.1 billion in 2021 to be spent on welfare, including minimum staff-child ratios (minimumsnormeringer) at kindergartens.
• The distribution of that pool will be negotiated between the government and its support parties, but not all demands of parties could be met, Wammen said.
• Increased spending on poor families and marginalized citizens, including a subsidy for low-income families agreed and announced last month.
• 1.2 billion kroner to be spent on the police and state prosecution and 1.5 billion on the country's tax authority in 2020.

Education

• Enforced spending cuts at universities to be scrapped.
• 300 million kroner in 2020 and 600 million kroner annually to be spent on training and hiring additional nurses within the country’s health service.

The government presented a series of initiatives it said will fund increased spending. These include a rollback of reductions to inheritance taxes; cancellation of planned tax subsidies on work telephones; and retaining an existing limit on taxation of profits on shares, which the previous government had planned to remove.

Higher tax on tobacco products, increasing employer liability for sick pay to a 10-day period (after which the state takes over covering the wags of an absent employee); and the cancellation of plans to establish a deportation facility on the island of Lindholm will also contribute to state coffers, according to the proposal.

Initial responses from left-wing parties suggest the government could face challenges negotiating the final budget.

The Red Green Alliance voiced concerns over the decision not to abolish a minimum six-year waiting period on returning to higher education to take a second degree programme, known in Danish as uddannelsesloftet.

The so-called ‘letter of understanding’ (forståelsespapir) agreed between parties as a basis for the minority government following June’s election stated that the rule would go.

The Social Liberals criticized reduced spending on schools and said the budget proposal did not go far enough on climate.

A 70 percent reduction in CO2 emissions by 2030 has been targeted by the government and allied parties. 

“We want a tangible CO2 reduction, including in the first budget. It must be the greenest ever. So more needs to happen there,” Social Liberal deputy leader Sofie Carsten Nielsen told Ritzau.

Sources: Ministry of Finance, Ritzau

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