Every summer, thousands of tourists from all over the world flock to Moskenes in Lofoten. Here is the archipelago’s most popular mountain, Reinebringen, idyllic fishing villages and chalk-white beaches. But majestic nature is not enough. Lille Moskenes, with less than 1,000 inhabitants, has had a miserable economy for years. – We are bankrupt. Bankruptcy. This is how mayor Hanna Sverdrup started today’s extraordinary municipal council meeting. Every year the municipality spends more money than it receives, and thus the deficit increases every single year. Moskenes has been on the so-called Robek list for the past 12 years. Now the situation is so bad that the municipal council is proposing that they declare themselves “bankruptcy” if they don’t get help – something that has never happened in Norway before. Reine in Moskenes municipality is a very popular tourist destination. The municipality is still doing poorly. Photo: Benjamin Fredriksen / Benjamin Fredriksen / news Help us or take over Moskenes itself It was Hartvig Magnus Sverdrup from Moskenes Fellesliste who put forward the proposal for a resolution asking for help. He argued that major deficiencies in everything from routines to systems lead to the economy continuing to fall off the cliff. This in turn has led to the employees being completely exhausted. Now the municipal council is demanding that the Ministry of Local Government must take greater responsibility for the residents of the municipality – as they themselves do not see how to manage it. – It is really an ultimatum. Contribute so that we can have people to establish routines and systems locally, or take it over, said Sverdrup from the podium. Many people make the trip to see the dry fish drying in the sun under the Reinebringen, but the municipality is in a state of financial turmoil. Photo: Benjamin Fredriksen / news Should the ministry not listen to the municipal council, the municipality threatens to adopt a payment recommendation – and give the responsibility completely to the ministry. Or said in another way; municipal “bankruptcy”. They are now asking for a meeting with the municipal minister where they will get clarification on whether they want to help them – or take over the task of running Moskenes themselves. The “bankruptcy proposal” was adopted by a unanimous municipal council. Hartvig Magnus Sverdrup presented the proposal. Photo: Vilde Bratland Erikstad / news – We believe the Ministry of Local Government is the last resort, says mayor Hanna Sverdrup to news. – Either they have to help us or we have to try to go bankrupt. Because we don’t see how to get out of it. We must both build up a structure that does not exist and at the same time pay off an enormous debt. – What happens if you don’t get help? – Then we will adopt a payment proposal, which is the municipality’s way of declaring bankruptcy. Mayor Hanna Sverdrup calls her own municipality bankrupt. Photo: Vilde Bratland Erikstad / news – What should I say to you? State administrator in Nordland, Tom Cato Karlsen, was also on the podium. He hardly knew what to say. – It is unplowed ground for you. For us. And for national authorities. As far as I know, no one has been in the situation financially and in terms of personnel that you are in now, he told the municipal council. – What should I say to you? You know that the situation is difficult, he added. State administrator Tom Cato Karlsen in Nordland on the podium in Moskenes. Photo: Vilde Bratland Erikstad / news Karlsen pointed out that he hopes that everyone in the municipality is now prepared to work with the same goal; to land on your feet. – What worries me is that, in the worst case, you will not be able to keep a straight line towards the goal. You don’t have the luxury of having many choices on how to do it. You guys are so on the rim that you have to do it the hard way. – It will not be an easy period in the future. Let’s establish that we have a common goal; we will make this happen. The state administrator hopes everyone in Moskenes understands that the situation requires everyone to work together to land on the right track. At the same time, he emphasized that he has faith that it is possible to find solutions. Photo: Synnøve Sundby Fallmyr / news Municipal money is no different But if Moskenes goes “bankrupt”, what actually happens then? – A municipality cannot go bankrupt, the state is a guarantor, says Håvard Moe, advisor in KS to news. He says the employees must be paid, even if the municipality cannot pay salaries itself. However, Moe is not aware that this has actually happened in Norway before. – Municipal money is no different from private money. There is real money in a bank account, and what do you do when the account is empty? What do you do then? asks Moe. – It is unplowed land. The state must intervene. Moskenes municipality cannot see how they are going to get out of the economic crisis. Photo: Synnøve Sundby Fallmyr / news Tor Allstrin, area director and lawyer at KS Advokatene, elaborates on what happens if Moskenes actually adopts a payment proposal. He says it follows from Section 29-2 of the Local Government Act that: “If a municipality or county council, due to difficulties that are not entirely temporary, cannot pay an overdue debt, the municipal council or the county council itself is obliged to make a decision on payment recommendation. A notification of such a decision must be immediately sent to the ministry.’ This is followed by procedures for making this public. When the decision has been made, the ministry must appoint a supervisory board. The state can hardly stop Moskenes Tor Allstrin, area director and lawyer at KS Advokatene, tells news that the Municipal Act’s rules on bankruptcy prohibitions and prohibitions on bankruptcy proceedings under the Bankruptcy Act are rules that have been given to protect the municipality and the municipality’s residents. – The rules are based, among other things, on the fact that a municipality has a number of assets that are necessary for the provision of services, and that a municipality cannot risk losing these in proceedings under the Bankruptcy Act. A municipality cannot therefore get rid of its debt on the basis of a debt negotiation under the Bankruptcy Act, but the legislation does not contain any prohibition against the municipality negotiating a debt arrangement with individual creditors. – Can the state refuse the Mosques to adopt a payment proposal? – The municipality is already under the ROBEK regime. See the Municipal Act, chapter 28. What we say is that there is close contact between the municipality and the State Administrator. Purely immediately, I cannot see that the state can review the municipality’s assessment of the payment proposal. It can be thought of in the form of a legality complaint from at least three municipal council representatives, or that the state itself decides to initiate a legality check. – Will a possible payment recommendation have consequences for other municipalities? – Not beyond the fact that municipalities that cooperate with the municipality can risk that this municipality does not pay the contributions/subsidies they are obliged to due to the payment setting. – Will a payment proposal mean that the elected representatives stop working? – No, they have an obligation to sit in their posts for the remainder of the election period. If so, how will the residents of Moskenes perceive it? – It could have an indirect effect, but not immediately and directly. This is difficult to answer in general. As long as a payment recommendation applies, no payments shall be made without approval or authorization from the supervisory board. Payments that are necessary for the municipality to fulfill its statutory obligations towards individuals must be prioritized, replies Allstrin. Two jobs The mayor argues that the municipality’s employees are exhausted. They also lack a number of employees. According to Lofot-Tidende, in January they were missing, among other things, a technical manager and a financial manager. The situation in the health sector is very bad. – Five have resigned and six are on sick leave. It puts an enormous burden on the poor people who are left behind. Then people can no longer manage, says Anne Jorid Gjertsen. She has been an ambulance worker for 28 years, but in addition she takes on rear guard duty as a nurse. – There has been a major shortage of nurses. That’s why I stepped in, she says and adds: – It hides a general need for nurses and staffing. It works if you have everything else in place, I mean. It is about the staffing situation at the nursing home.
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Moskenes municipality will bankrupt itself if they don’t get help – news Nordland
