Nordic government subsidies in comparison

A report describing and comparing the government subsidy systems in Sweden, Denmark and Norway has been published. The state subsidy systems of the countries under review are complex in nature and in some cases complex, also in comparison with the Finnish system.

The report is a follow-up to a preliminary study by the Ministry of Finance on the development needs of the municipal government subsidy system . In addition to the Finnish state subsidy system, the preliminary study also raised comments on the Swedish system. However, it was recognized during the work that, when reforming the government subsidy system, it would be necessary to further examine the government subsidy systems of other countries.

The report presents the structures of the government systems in Sweden, Denmark and Norway. In addition, an overview of the public administration and the revenue structures of the municipalities and regions is provided for each country under review.

The comparative section highlights differences between countries. The biggest difference in the field of public administration is the two-tier public administration in Finland so far. In Sweden, Denmark and Norway there are three levels of public administration. As a result, the distribution of tasks in public administration also differs in the countries under review. The main difference is the responsibility for organizing primary health care and specialized health care, which, unlike Finland, is wholly or partly held by larger organizers. In Sweden and Denmark, the responsibility for organizing specialized health care lies at regional level, while in Norway it is the state.

The government systems of Finland, Sweden, Denmark and Norway have both uniformities and differences. In Finland, cost-level equalization is the most important part of the system, while income equalization complements the system. In Sweden, the system of government subsidies works the other way round, with income equalization being the basis of the system. All systems balance both costs and revenues. However, the Danish system differs in that the adjustment is made on the basis of the difference between imputed costs and income. In Norway, compensatory schemes are included in the fixed state subsidy.

The Finnish government subsidy system is often criticized for its complexity. Similar criticism exists in other countries. A certain degree of complexity is also needed in order for the system to take into account, as far as possible, the circumstances that influence the costs of municipalities. However, it can be noted that the state subsidy systems of the countries under review are all complex in one way or another, also compared to the Finnish system.

 

The report was written during a three-month internship period, which provided an insight into the Swedish, Danish and Norwegian systems.

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