The water tax will be even more expensive. Cheaper tram tickets will have to wait. And private sports facilities receive less support. These are some of the cut proposals in the new Oslo budget. Triple problem Here, the city council has had to solve a triple dilemma: Power shock, price shock and tax shock. – We have a triple problem. The energy tax is the worst, says finance councilor Einar Wilhelmsen (MDG). A month and a half has passed since he presented the city council’s proposal for next year’s Oslo budget. Then it was record high electricity revenues that saved the city from crisis. The supplementary budget arrived today. Compared to what Wilhelmsen thought at the time, Oslo municipality has between NOK 2 and 3 billion less to deal with this year and next year combined. – I then said that everything was expensive. Now it has become even worse, he says. In the meantime, the national budget arrived. And for Oslo it made it worse, according to Wilhelmsen. Much worse. The Finance Board’s triple problem is this: Increased tax on hydropower. For Oslo, this means NOK 1 billion less in dividends from Hafslund next year. No compensation for increased electricity costs. The city council increases the pot to pay electricity bills by NOK 540 million in 2022 and NOK 350 million in 2023. No compensation for general price increases beyond what the Storting already decided in June. The city council fears additional expenses of just over NOK 400 million in 2022 and the same in 2023. In recent weeks, the city council has turned over all stones to find coverage. – We have done what we can to avoid cuts in welfare and cuts in our climate initiatives. We have managed that. – We are postponing the introduction of ticket price cuts a little, and a good number of other reprioritisations, small adjustments, cuts and reductions are being made. But it should not go beyond the service we provide to the citizens, says Wilhelmsen. Taking away pension The city council’s main move is to get rid of one of the municipality’s many funds. The so-called premium deviation fund is drained for NOK 700 million. In this fund, Oslo municipality has added money to pay for increased pensions in the future. The fund must be used if there is not enough money in the ordinary pension fund, which the municipal employees pay into. – People’s pensions are not a risk at all. The pension money is safe in the pension fund, says the Finance Council. He says that not paying people what they are entitled to in pensions is not an option. The fund must therefore be topped up again, or the money must be taken from elsewhere. Einar Wilhelmsen therefore acknowledges that the pension scheme has the feel of “peeing in your pants to keep warm”. – We have had to do this very quickly. It somewhat defends the use of the fund in this way. – We have to strike a balance, he says. Corona money Some help comes in the form of increased tax revenues. It is estimated that the people of Oslo will pay roughly one billion more in taxes this year. The municipality gets to keep just over half. The city council is also betting on the government turning up around 200 million kroner to which they believe they are entitled. But cuts do not escape the city council, and here are some examples: Postponing the promise of 20 per cent cheaper single tickets until over Easter. NOK 200 million had been set aside for this in 2023. Cuts in the municipality’s work with digitization. Cuts in subsidies for investments in private sports facilities. Still looking at Huken crushed stone. Pushes on maintenance Collects any profits in municipal businesses this year In addition, the water and sewerage fee increases even more than first thought. The reason is higher interest on the large water and sewage projects. In September, the city council proposed an increase of 16.5 per cent. Now the increase will be 23.4 per cent instead.
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