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Will Sweden’s right-bloc meet the deadline to strike a government deal?

Moderate leader Ulf Kristersson is due to submit his report to the Speaker on coalition talks at 11am on Wednesday and it looks like the parties are still divided. Will he need an extension and is a deal possible?

Will Sweden's right-bloc meet the deadline to strike a government deal?
A police car parked outside Tidö Slott near Västerås, where the leaders of the right-wing bloc were negotiating over the weekend. Photo: Fredrik Sandberg/TT

How well are the talks going? 

Kristersson has from the start underlined the constructive approach taken by all parties, and the four parties have for the most part managed to keep leaks, anonymous briefing, and public disputes under control with still very little known about the detail of the discussions. 

Nicholas Aylott, associate professor of politics at Stockholm’s Södertörn University, said that this suggested that the four parties were managing to negotiate calmly. 

“I think if the negotiations had really hit trouble, then we would probably have got some inkling of it,” he said. “It’s hard to imagine that they would have kept real problems quiet.” 

What’s the sticking point? 

The big difference in opinion seems to be between the far-right Sweden Democrats and the Liberals.

The Liberal Party’s parliamentary group leader Mats Persson broke silence on Tuesday to state publicly that his party still expected to have ministerial posts in the new government. 

A source in the Sweden Democrats last week told Sweden’s state broadcaster SR that the far-right party did not want the Liberals included in the new government. 

According to Dagens Nyheter, SD leader Jimmie Åkesson has been meeting Liberal leader Johan Pehrson in person to try to overcome the deadlock. 

“What probably remains uncertain is whether the Liberals will be in the government, and there I think it really could go either way,” Aylott said. 

“I think if I had to put money on only one outcome, it would be that the Liberals are out, but I can quite imagine a scenario in which they’re in, and the Sweden Democrats show what a mature and stable and trustworthy party they are by accepting it. It’s not inconceivable.” 

So will there be a deal by Wednesday? 

With a month now gone since the election, Kristersson’s government-building talks are already the second-longest since Sweden brought in universal suffrage in 1921. His rhetoric during the election campaign, that the parties in Prime Minister Magdalena Andersson’s left-wing bloc were divided while his right-wing bloc were united, already looks tarnished. 

But it looks far from clear that he will be able to visit Andreas Norlén, the Speaker, with a deal in hand. 

Persson on Tuesday said his party was willing to extend talks past the deadline of this Wednesday if it is necessary for it to achieve this goal.

“We’re in no hurry. The most important thing is that this will be good for Sweden,” he said.

Aylott argues that while it might be embarrassing for Kristersson to ask Norlén for an extension on Wednesday, he did not think it was impossible. 

“I’m cautious about that because it may require a little bit more time, and I don’t get the impression that they they feel overly stressed to meet that deadline,” he said. “If it requires another another few days or a week, then it’s something that I think everybody can live with. They could well be done in time. But if they’re not, it’s perhaps not such a sensation.”

 
Are the Liberals in a position to make demands?
While the Liberals are the smallest party in the new parliament with only 16 seats, Aylott argues that they are “not entirely without leverage”, given that they hold enough seats to grant or deny Kristersson’s government a majority. 

“What they could do is threaten to cause trouble from outside the government and do deals with other constellations of parties on particular issues in a sort of imprecise, unspecified way,” he said. “That is something that gives them a little bit of bargaining strength.” 

More crucially, without the Liberals’ support, Kristersson cannot pass a vote as prime minister. 

Aylott, however, said he thought it was highly unlikely that the Liberals would be willing to switch sides at the last moment and instead reinstate outgoing Social Democrat Prime Minister Magdalena Andersson. 

“If they hadn’t already changed their minds twice over the last few years, then that threat might be a bit more credible,” he said, “but to swing back leftwards, again, after all the agonies that the party has been through, and particularly after the most recent switchback, which may well have saved the party’s parliamentary seats, I think is not really very credible.” 

So how much do the Liberals want that ministerial seat? 

That’s the question that really gets to the heart of it,” Aylott said. “I can see two ways of reasoning. One way is for the party to think, ‘well, maybe it’s not so important for us, because we can exercise influence without shouldering the burdens and the responsibilities of office. And in some ways, that might be quite an advantageous position.”

“But what the Liberals really need above all else is visibility. They need to consolidate their electoral support. They just don’t have enough votes to be confident of staying at the centre of Swedish politics.”

“And a prerequisite for doing that really, is to become visible, to have people who get the media’s attention in the coverage of everyday politics. And if you’re in the government, of course, that makes it considerably easier.” 

In addition, throughout the election campaign, Johan Pehrson positioned himself as Sweden’s next education minister, meaning he may be loath to see someone else in the role. 

“He would certainly like that position, because education has been such a strong issue for the Liberals. Under [former leader Jan] Björklund it was really the education party, so to try to reclaim that policy area for the Liberals, I think, has has obvious attractions. So that might just persuade Pehrson to play a little bit harder.” 

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POLITICS

Full steam ahead for Swedish economy in new three-part budget bill

Sweden has won the fight against inflation and expects GDP to grow next year, Finance Minister Elisabeth Svantesson proudly proclaimed as she presented the government's budget bill for 2025.

Full steam ahead for Swedish economy in new three-part budget bill

“Going forward, the task will be to ensure that high inflation does not return, and at the same time to implement reforms and investments that build a more prosperous, safer and more secure Sweden for generations to come,” said Svantesson in a statement on Thursday morning.

The government predicts that Swedish GDP will grow 2.5 percent next year followed by 3.2 percent 2026.

Unemployment, however, is expected to remain unchanged at 8.3 percent in 2025, only beginning to drop in 2026 (7.9 percent, according to the government’s predictions, followed by 7.6 percent in 2027).

Svantesson told a press conference that a strong focus on economic growth would create jobs.

The 2025 budget, worked out in collaboration between the right-wing government coalition and far-right Sweden Democrats, is far more expansionary than the restrained budget Svantesson presented last year when Sweden was still fighting high inflation: 60 billion kronor towards new reforms rather than 39 billion kronor for 2024. Almost half, 27 billion kronor, will go towards funding lower taxes.

ANALYSIS:

Svantesson highlighted three areas in which new reforms are prioritised:

  • Strengthening household purchasing power after several years of the high cost of living putting a strain on household budgets, with reforms set to push the tax burden to its lowest level since 1980, according to the government.
  • Reinstating the “work first” principle, meaning that people should work rather than live on benefits. Some of the measures include language training for parents born abroad and increasing the number of places in vocational adult education.
  • Increasing growth, focusing on investments in research, infrastructure and electricity supply.

In the debate in parliament on Thursday, the centre-left opposition is expected to criticise the government for lowering taxes for high earners and not investing enough in welfare. 

Investments in healthcare, social care and education are significantly reduced in this budget compared to last year: down from 16 billion kronor to 7.5 billion kronor. 

Meanwhile, the hike of the employment tax credit (jobbskatteavdraget) – a tax reduction given to people who pay tax on their job income – is expected to lead to a 3,671 kronor tax cut for people on the median salary of 462,000 kronor per year.

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