b b Political-economic calendar 181

The political-economic calendar for 1993- ment with local-authority employers. The result taxes: a tax on carrier bags is introduced from 2002 comprises a summary overview of of this collective agreement is largely similar to 1994. This tax amounts to approximately DKK important financial and political measures the agreement made for state employees. The 0.50 per standard bag. (No. 488/30 June). and events which may be of significance agreement entails a 2.52 per cent pay rise du- From 1994, petrol taxes are increased by DKK when assessing the time series of the ten- ring the next two years. Local government em- 0.30, a figure which will rise to DKK 0.47 in year review. The heading dates provided for ployees will receive a 0.51 per cent pay rise on 1 1998, and diesel taxes increase by DKK 0.10 per Acts indicate the time of adoption by the April, a 0.49 per cent pay rise in October 1993, litre as of 1997. Both taxes will increase by an Danish Parliament. The date accompanying and a 1.52 pay rise in April 1994. Moreover, the additional DKK 0.46 per litre if Germany the number of the relevant Act refers to the agreement comprises a DKK 300 million introduces tax increases. (No. 489/30 June). date of ratification. expansion of pension schemes and a 40 per cent Duties on coal, lignite and coke are gradually increase in the local-pay scheme. increased by DKK 350, 621, and 259 per tonne during the period from 1995 to 1997. 30 April Stamp duties withdrawn 1993 (No. 490/30 June). Effective as of 24 March 1993, the Danish Par- The charge on electricity will be gradually 1 January Czechoslovakia is split liament repeals legislation dealing with payment increased during the course of the 1994-1998 Czechoslovakia is split, giving rise to two new of stamp duties in connection with property period. This increase amounts to DKK 0.03 per states: the Czech Republic and Slovakia. purchases, loans for consumption purposes, kWh in 1994 and will rise to DKK 0.19 in 1998. credit, etc. Deeds in connection with transferral (No. 491/30 June). 14 January The Tamil Report is published of property are also exempt from stamp duties As of 1 January 1994, water charges to the On the basis of the findings of the report until the end of October 1993. (No. 244/3 May). amount of DKK 1 per cubic metre are intro- prepared on the Tamil case, the Prime Minister, duced; this rate will increase to DKK 5 per cubic 18 May Referendum on the EU Poul Schlüter, tenders the resignation of the KV metre in 1998. Enterprises which are registered The result of the referendum on the EU is a 'yes' government. for VAT will qualify for reimbursement of this to Danish accession to the European Union. Of water charge; however, this does not apply to 25 January New Danish government the votes cast, 56.7 per cent were in favour of the professions and the entertainment sector. The negotiations on the formation of a new Danish accession, whereas 43.3 were against. government result in a government comprising (No. 468/30 June). the Social Democratic Party, the Centre Demo- 24 June The tax reform Waste charges are increased as of 1 January crats, the Social Liberal Party, and the Christian The Danish Parliament adopts a series of Acts; 1997, and will be differentiated as follows: People’s Party. The new Prime Minister is Poul which comprise the tax reform. Personal income 1) Waste for incineration will be subject to a Nyrup Rasmussen. tax: the tax scales are subjected to a restruc- charge of DKK 210 per tonne. turing with the following main features: the 2) Waste for landfilling will be subject to a 15 February Collective agreement within current state tax, which amounts to 22 per cent charge of DKK 285 per tonne. the industrial sector of taxable income, is reduced and divided into 3) Waste which is used for energy-recovery The Central Organisation of Industrial Emplo- two tax brackets: in 1994, taxable incomes up to purposes in electricity generation or joint yees in Denmark and the Confederation of Da- DKK 130,000 will be taxed a basic tax rate of generation of electricity and heating will be nish Industries enter into an agreement which 14.5 per cent. This basic tax rate will be gradu- subject to a charge of DKK 160 per tonne, entails increases to the minimum wage: DKK 1 ally reduced to 8 per cent in 1998. Deductible which is the current charge imposed on per hour as of 1 March 1993, DKK 1.35 as of 1 expenses and basic personal allowances are incineration waste. (No. 493/30 June). March 1994, and another DKK 1.35 as of 1 always deducted from this tax bracket. Taxable The car tax (for vehicle certificates) on vans February 1995. This brings the minimum wage incomes greater than DKK 130,000 per year will weighing between 2 and 3 tonnes is increased rate up to DKK 69.70 per hour. In addition to the be subject to a new intermediate tax, which to DKK 30,000, whereas the car tax on vans increases to the minimum-wage rates, the indu- amounts to 4.5 per cent in 1994. This tax rate weighing between 3 and 4 tonnes is increased strial sector has secured full pay during the first will increase to 6 per cent for the 1997 income to DKK 19,000. Small buses which are not used two weeks of absence due to sickness for its year. The present so-called "6 per cent tax" is to for commercial purposes will be subject to a 60 employees as of 1 March 1994, and the rate to be phased out over a three-year period and will per cent tax on the taxable value in excess of be paid for the labour-market pension scheme is be completely withdrawn in 1996. As of next DKK 6,100. The vehicle tax (vehicle-certificate increased from the current 0.9 per cent of total year, unearned income (income from capital and tax) on motorcycles is reduced, whereas rental pay to 1.2 per cent as of 1 July 1994. investments) will no longer be included in the cars are exempt from this tax. tax base within this tax bracket. The "12 per (No. 429/25 June). 19 February Collective agreement cent tax" - now also known as the top tax - will 25 June Labour-market reform for state employees be gradually increased to 15 per cent in 1996. In As part of the labour-market reform, the Danish The state employees, as represented by the Joint addition to earned income, the tax base for this Parliament decides to restructure the unem- Committee of the Central Organisations, agree tax bracket now also includes unearned income ployment benefit system as of 1 January 1994. on a settlement with the Danish Minister of greater than DKK 20,000 for unmarried indivi- The new regulations mean that unemployed Finance. This agreement entails a 2.5 per cent duals and DKK 40,000 for married couples. The individuals can remain within the unemploy- pay rise for state employees during the course of tax ceiling is reduced to 65 per cent in 1994 and ment benefit system for a total of nine years, in- the next two years. The first year will see a pay will be reduced to 58 per cent in 1998. Also, the cluding two years of leave for education/training rise of 0.5 per cent, whereas the following year 3 per cent allowance hitherto in force is repea- or child care. The seven-year period where it is will see an additional 1.0 per cent pay rise. The led as of 1994. (No. 480/30 June). possible to claim unemployment benefit com- remaining 1.0 per cent is allocated for measures The regulations on mileage allowances are prises two parts: such as the annual 0.9 per cent extension of the amended, so that it is only possible to qualify 1) The first part is a four-year period, where un- pension scheme and funding for a scheme which for a tax allowance for distances in excess of 24 employed individuals can claim unemploy- means that approximately 1,000 state emplo- kilometres. Mileage allowances for distances ment benefit in accordance with current un- yees can take up to 20 weeks of leave for between 54 and 100 kilometres are increased by employment benefit regulations. During this training and receive leave benefits plus addi- increasing the rate per kilometre from DKK 0.29 period, unemployed individuals are entitled tional funding to cover the difference between to DKK 1.17; for distances greater than 100 to one year of education and/or job activa- such benefits and their normal pay. The auto- kilometres, the rate is DKK 0.29 per kilometre. tion. After one year of unemployment, it is matic adjustment scheme remains in effect and (No. 482/30 June). possible to elect to combine unemployment is expected to occasion a 0.6 per cent pay rise in As of 1994, rental value rates directed against benefits with income from casual work for a 1993. The local performance-related pay scheme home-owners are reduced: from 2.5 to 2.0 per one-year period: in addition to receiving 80 is extended by 0.2 per cent, which is funded by cent for houses with a value of less than DKK per cent of the maximum unemployment be- the adjustment scheme. 1.4 million, and from 7.5 to 6.0 per cent for nefit rate, it is also possible to earn a maxi- properties with a value of more than DKK 1.4 25 February Local-authority mum of DKK 27,500 within this one-year pe- million. (No. 423/25 June). collective agreement riod. During this period, the obligations re- Local government employees, as represented by 24 June Tax and duty amendments garding labour-market availability do not KTO (The Association of Local Government The Danish Parliament adopts a series of tax apply. Employees' Organisations), agree on a settle- and duty amendments, the so-called green

b b 182 Political-economic calendar

2) The second part, which is a three-year receive taxable gross benefits similar to unem- membership of an unemployment insurance period, can also be extended by a period of ployment benefits. As of 1 January 1994, cash- fund and 26 weeks of employment within the leave. During this period, it will also be pos- benefit claimants who support children will last three years. Publicly subsidised employment sible to combine unemployment benefits receive 80 per cent of the maximum unem- no longer qualifies with regard to this employ- with income from casual labour in accordan- ployment-benefit rate, i.e. DKK 8,852. Claimants ment requirement. (No. 1062/22 December). ce with the scheme outlined in the above. with no obligation to maintain others will

The new regulations on unemployment benefits receive DKK 6,634. The regulations regarding also ensure that no unemployed individuals over young people under the age of 23 will remain in 1994 the age of 50 who qualify for early retirement force, even though cash benefits are also benefit will lose their right to receive unemploy- converted to gross income for this group. 19 April Reduced home-improvements subsidies ment benefit prior to their early retirement. Until The Danish Parliament reduces the subsidies the end of 1996, unemployed individuals over 2 August Changes to the EMS granted for property improvements. The subsidy the age of 50 will also be able to receive The fluctuation margins for all currencies within rate is reduced from 50 to 40 per cent, and the transitional benefits corresponding to 82 per the European Monetary System (EMS) have been maximum grant is reduced from DKK 10,000 to cent of the maximum unemployment benefit changed to ± 15 per cent. However, Germany DKK 7,000 for all types of homes, except listed rate; these transitional benefits are currently and the Netherlands have announced that they buildings and buildings of special architectural available to unemployed individuals between have entered into a bilateral agreement which or historic interest: for such properties, the the ages of 55 and 59. As part of a pilot scheme, ensures that the intervention rates hitherto in maximum subsidy available is reduced from DKK transitional-benefit recipients will also have the force between the German Deutschmark and the 50,000 to DKK 25,000. Properties which are not opportunity to combine this benefit with income Dutch guilder remain in force. used as permanent residences now only qualify from casual labour. (No. 436/30 June). This results in the following intervention rates for a grant for meters to monitor consumption of Other elements of the labour-market reform between Danmarks Nationalbank and foreign- water, electricity, gas, etc. The grant available include the following: as of 1 January 1994, it exchange dealers: for individual meters is reduced from DKK 8,000 will be possible to choose between three types Buying rate: 328.461 DKK per 100 DEM to DKK 7,000, while the grant for common of leave for periods of up to one year. This Buying rate: 97.943 DKK per 100 FRF meters is reduced from DKK 25,000 to 20,000. involves extensions in the duration and scope of Buying rate: 15.9266 DKK per 100 BEF the existing schemes. Buying rate: 291.544 DKK per 100 NLG 5 May Annual property valuations 1) Leave for education and training. This Buying rate: 792.014 DKK per 100 IEP As of 1 January 1996, official property valua- scheme is available to persons over the age Buying rate: 4.1519 DKK per 100 ESP tions will be conducted annually; this will in- of 25 who are members of an unemployment Buying rate: 3.3209 DKK per 100 PTE clude access to appeal the decisions made. A insurance fund and who have been in Asking rate: 442.968 DKK per 100 DEM special transitional scheme will, however, be in employment for a minimum total period of Asking rate: 132.066 DKK per 100 FRF force during the 1996-98 period, and current three years within the last five years. The Asking rate: 21.4747 DKK per 100 BEF regulations on schematic annual adjustments terms of this leave must be agreed upon with Asking rate: 393.105 DKK per 100 NLG between the general valuations will be applied the employer. Unemployed members of un- Asking rate: 1067.92 DKK per 100 IEP for the last time on 1 January 1997. A new employment insurance funds and self- Asking rate: 5.5985 DKK per 100 ESP structure is also introduced within the field of employed individuals also qualify for edu- Asking rate: 4.4777 DKK per 100 PTE property evaluation; however, the valuation cation/training leave. During the period of The central rates in relation to the ECU remain organisation will remain under the auspices of leave, scheme participants will receive bene- unchanged. The theoretical central rates for the the Danish state. The Minister for Taxation fits corresponding to the maximum unem- British pound, Italian lira, and Greek drachma, appoints a valuation council comprising a ployment-benefit rate. However, as of 1 April which do not take part in this monetary system, chairman and two real estate appraisers. 1995, this benefit is reduced to 80 per cent also remain unchanged. of the maximum unemployment-benefit rate. 24 May Partial early-retirement benefit 16 December Adoption of the Finance Act 2) Sabbatical leave. The conditions for sabbati- for the 60-66 year-olds. The government parties, the Danish Liberal cal leave are the same as for education/trai- As of next year, 60-66 year-olds will qualify for Party, and the Conservative Party adopt the ning leave. However, an additional require- partial early-retirement benefit if they reduce 1994 Finance Act. The Socialist Peoples’ Party ment stipulates that employers must hire an their number of working hours. This scheme and the Progress Party are against this budget. unemployed person for the duration of the supplements the standard early-retirement bene- The total revenues within the operating budget, leave period. Leave benefits correspond to 80 fit scheme, and the same preconditions apply to public works budget, and lending budget for per cent of the maximum unemployment- both types of benefit. The Partial Early- 1994 are estimated at DKK 334.5 billion, and benefit rate. Retirement Benefit Act stipulates that this total expenditure, including interest on national 3) Parental leave to care for children between benefit is calculated as a set payment of 82 per debts, is estimated to amount to DKK 388.9 the ages of 0-8 years. Parents who are in cent of the hourly maximum unemployment billion. The corresponding figures for 1993 are employment, self-employed, unemployed benefit rate per one-hour reduction in working estimated at DKK 310.6 billion and DKK 362.3 members of an unemployment insurance hours. billion, respectively. The gross public-sector fund, or cash-benefit claimants can take pa- borrowing requirement (gross cash deficit) in 9 June Election for the European Parliament rental leave to care for their children for a 1994 is expected to amount to DKK 119.9 An election is held for the European Parliament, maximum period of 52 weeks. billion; the corresponding 1993 figure being DKK which results in the following distribution of (No. 435/30 June). 137.8 billion. The 1994 Finance Act estimates votes (in per cent): 25 June Labour-market contributions introduced that the nominal national debt (without deduc- The Social Democratic Party ...... 15.8 As part of the tax reform process, the Danish tions for the assets of Den Sociale Pensionsfond The Social Liberal Party ...... 8.5 Parliament decides to introduce a new gross tax ["the Social Pensions Fund"]) will amount to The Conservative Party ...... 17.7 to help finance three new labour-market funds: DKK 701.4 billion at the end of 1994; the The Centre Democrats ...... 0.9 an unemployment-benefit fund, an activation corresponding figure for the end of 1993 being The Socialist Peoples’ Party ...... 8.6 fund, and a sickness-benefit fund. As of 1 Ja- DKK 645.4 billion. The interest burden on this The JuneMovement ...... 15.2 nuary 1994, employees and self-employed debt is estimated at DKK 62.7 billion in 1994, The People’s Movement against the EU .. 10.3 individuals must pay 5 per cent of their gross the 1993 interest burden being DKK 61.5 billion. The Christian People’s Party ...... 1.1 earnings. The gross tax - or labour-market con- Venstre (Denmark’s Liberal Party) ...... 19.0 17 December Simpler rules for inclusion in tribution, as it is also known - will increase The Progress Party ...... 2.9 unemployment insurance funds gradually to 8 per cent in 1997. Employers will Total ...... 100.0 The Danish Parliament adopts legislation to sim- not be called upon to pay contributions before This distribution of votes entails the following plify the rules governing admittance to unem- 1997 at the earliest. (No. 448/30 June). distribution of seats: four members for the ployment insurance funds. Employees must be in Danish Liberal Party, three members each for the 25 June Cash benefits converted employment, with or without public subsidies, Social Democratic Party and the Conservative to gross earnings when applying for membership. The right to re- Party, two members each for the June- The Danish Parliament decides to restructure the ceive unemployment benefit remains subject to Movement and the People’s Movement against cash-benefit system, so that benefit claimants the same prerequisites as before: one year of

b b Political-economic calendar 183

the EU, and one member each for the Social − The regulations governing activation of be- estimated at DKK 59.3 billion in 1995; the 1994 Liberal Party and the Socialist Peoples’ Party. nefit claimants are simplified. Benefit clai- figure being DKK 62.0 billion. mants under the age of 25 who receive

29 August A general election is announced trainee benefits will be under an obligation The Prime Minister, Poul Nyrup Rasmussen, to be activated for a minimum of 30 hours a 1995 announces that a general election will be held week; the current minimum is 20 hours a on 21 September. week. Young student recipients of student 1 January New members of the EU grants (SU) do not qualify for cash benefits if Finland, Sweden, and Austria are accepted as 21 September. General election they take leave from their studies. The age members of the European Union, bringing the The general election results in the following limit for the so-called youth rates, which number of Member States up to 15. distribution of seats in the Danish Parliament amount to approximately 50 per cent of the (for the previous distribution of seats, please see cash benefit rate for adults, is raised from 23 9 January Austria enters the EMS »12 December 1990«): years to 25 years. The cash-benefit system As of 9 January, the Austrian schilling takes part The Social Democratic Party ...... 62 also sees a tightening of regulations on a in the European Monetary System (EMS) with The Social Liberal Party ...... 8 series of other issues. fluctuation limits of 15 per cent each way. As The Conservative Party ...... 27 (No. 1127/21 December). part of the admission process, intervention rates The Centre Democrats ...... 5 − Mileage allowances are increased as of the have been stipulated for the Austrian schilling in The Socialist Peoples’ Party ...... 13 1995 tax year. Rates for the longest stretch relation to the other participating currencies. Venstre (Denmark’s Liberal Party) ...... 42 of travel are amended from 25 to 50 per cent The intervention rates for the Danish krone are The Progress Party ...... 11 of the normal rates, bringing the allowance as follows: The Danish Red-Green Alliance ...... 6 rate up to DKK 0.595 per kilometre. Persons Buying rate: DKK 46.6910 per ATS 100 Others ...... 1 using the transitional rule on own-vehicle Asking rate: DKK 62.9561 per ATS 100 Total ...... 175 transportation will receive a corresponding The ECU central rate for the Danish krone An additional four members were elected for DKK 0.2975 per kilometre increase in the remains unaltered: ECU 1 = DKK 7.43679. The Greenland and the Faroe Islands, two from each allowance rate for travel/commuting in intervention rates between the other currencies region. excess of 100 kilometres. who participated in the EMS prior to this date A new minority government is subsequently for- (No. 1117/21 December). also remain unchanged. med (on 27 September), comprising the Social − The scheme on state grants for improve- Democratic Party, The Social Liberal Party, and ments to permanent residences and holiday 16 February Collective agreement the Centre Democrats, with Poul Nyrup Rasmus- homes is repealed. (No. 1086/21 December). for state employees sen as Prime Minister. The state employees, as represented by the Joint 24 November Longer time limits for Committee of the Central Organisations, agree 21 November Agreement on the Finance Act restructuring cash loans on a settlement with the Danish Minister of The government enters into an agreement with The Danish Parliament decides to increase time Finance. The total pay framework for the two- the Danish Liberal Party and the Conservative limits in connection with restructuring cash year agreement period amounts to 3.5 per cent. Party on the 1995 Finance Act. This agreement loans, thus providing borrowers with greater General pay rises account for 2.25 per cent, includes the following elements: opportunities for choosing the time for any loan which will be distributed as follows: 0.70 per − The leave schemes for the purposes of restructuring. The objective is to take into cent on 1 April 1995, 0.75 per cent on 1 April education/training and child care will conti- consideration those home-owners who - during 1996, and 0.80 per cent on 1 October 1996. The nue beyond 1996, and the pilot scheme on the previous period of low interest rates - remaining 1.25 per cent are set aside for sabbatical leave will continue to the end of terminated their old cash loans without hedging pensions and other schemes. The agreement 1999. Leave benefits are reduced for parti- their new loan. Tax allowances are usually made also comprises a continuation of an adjustment cipants in child-care and sabbatical leave for losses incurred in connection with this type scheme in relation to pay developments within schemes: from 80 to 70 per cent of the of loan restructuring, on the condition that the the private labour market. Moreover, this maximum unemployment benefit rate. This regulations on time limits regarding the period collective agreement involves the following reduction has already been introduced: the between termination of the old loan and raising main issues: proposal was in effect from the time of its of the new loan are complied with. With this − Local performance-related pay: in 1995, 0.87 submission to the Danish Parliament. Further Act, the requirement on simultaneousness is per cent of the total pay will be subject to reductions to these benefits will be carried stipulated in a manner which generally allows local pay negotiations; this figure will out (to 60 per cent) in 1997. Leave benefits for a lapse of up to one year between these two increase to 1.04 per cent in 1996. These with respect to education/training remain at transactions. These amendments apply to percentages are, however, maximum rates, 100 per cent of the maximum unemployment restructuring which has been carried out after 27 and public enterprises are under no obli- benefit rate. (No. 1084/21 December). June 1993. (No. 1112/21 December). gation to apply this scheme, which will be − The sibling discount scheme is amended, so discontinued during the next two years. that parents must pay full rates for the most 15 December Adoption of the Finance Act − Pensions: employees without full pension expensive place and 50 per cent of the rates The government parties, the Danish Liberal schemes will receive an additional 2.1 per for all other children attending day-care Party, and the Conservative Party adopt the cent for pensions as of 1 October 1995. This centres, kindergarten, recreation centres, etc. 1995 Finance Act. The Socialist Peoples’ Party, brings the level of these schemes up to The added cost burden will be greater for the Progress Party, and the Danish Red-Green approximately 10 per cent of wages. The families with small children. Consequently, Alliance are against the Act. ultimate target is 12 per cent; this objective child allowances are increased by DKK 1,000 The total revenues within the operating budget, is expected to be met in 1997. for the 0 - 2 age bracket. The final payment public works budget, and lending budget for − Parental care days: in future, parts of the of special baby allowances will be made in 1995 are estimated at DKK 350.2 billion, and maternity/paternity leave period can be used the quarter where the child in question turns the total expenditure, including interest on for parental care days. State-employed three. (No. 1116/21 December). national debts, is estimated at DKK 390.2 women are entitled to maternity leave eight − Regulations governing labour-market billion. The corresponding figures for 1994 are weeks before term; if they elect to wait until availability are tightened. Greater opportuni- estimated at DKK 342.6 billion 386.7 billion, six weeks before term, however, they will be ties will be introduced for assigning unem- respectively. The gross public-sector borrowing entitled to take ten individual days off work ployed individuals to work outside the scope requirement (gross cash deficit) for 1995 is during the first year after the date of birth. of their own sector after 12 months of unem- expected to be DKK 168.1 billion; the corre- Moreover, both mothers and fathers can ployment. The long-term unemployed will be sponding 1994 figure being DKK 134.3 billion. accumulate any overtime, and use it to care obliged to accept activation offers to uphold The 1995 Finance Act estimates that the for a sick child. their right to receive unemployment benefits. nominal national debt (without deductions for − Education/training: more state employees This Act was passed with amendments the assets of Den Sociale Pensionsfond ["the can receive full pay during education and regarding issues such as regulations on in- Social Pensions Fund"]) will be DKK 745.6 training. During the last period, funds were come guarantees, income ceilings, and un- billion at the end of 1995, whereas the set aside for a total of 27,000 weeks of employment benefits. corresponding figure for 1994 was DKK 695.2 education and training; this has been increa- (No. 1985/21 December). billion. The interest burden on this debt is sed to 47,000 weeks with this agreement.

b b 184 Political-economic calendar

− Trainee pay: recently qualified academics months, rather than six weeks. Previously, 24 May Welfare Commission Report with one year of unemployment can be employers were able to demand 40-hour is published employed as trainees at 80 per cent of the weeks; the new collective agreements en- The Welfare Commission presents its report, usual starting pay. To counterbalance this sures that the weekly working hours can only which includes the following findings: reduction in pay, 20 per cent of the working exceed 37 hours when the employees − The education system: the Commission pro- hours are to be used for training and edu- consent to this. poses a reform of the education system with cation. − Terms of notice: a new two-week term of a view to ensuring that the business − Social chapter: the parties agree to join in notice is introduced for employees after six community will enjoy a highly qualified and common efforts to increase state employ- months of employment. flexible labour force in future, and to ment rates for those groups who find it − Sickness: the period of full pay during improving opportunities for all citizens to difficult to gain a foothold within the labour sickness is extended from two to four weeks gain a permanent foothold within the labour market. For example, agreements have been as of 1 March 1996. market. Problems are evident within voca- entered into on how such positions can be − Maternity / paternity leave: as of 1 March tional education, which has an annual drop- established on special terms with regard to 1997, women are entitled to full pay (up to a out rate of approximately 30 per cent. pay and working hours. maximum of DKK 95 an hour) for 14 weeks Standards are falling at institutions of higher of maternity leave. Men receive full pay education, a fact which impairs Denmark's 19 February Local-authority during the two weeks of paternity leave. opportunities for maintaining its position collective agreement − Supplementary training: employees receive amongst the wealthiest countries in the Local government employees, as represented by full pay during periods of supplementary world. KTO (The Association of Local Government Em- training when their participation meets with − The labour market: the Commission agrees ployees' Organisations), agree on a settlement consent from their employers and where that lower unemployment benefits and lower with local-authority employers. such participation qualifies for a state sub- minimum wages will not solve the entire The total framework for pay improvements is 3.5 sidy. unemployment problem. Such measures per cent. General pay rises account for 2.22 per − Social chapter: no specific social chapter is could entail a reduction in living standards cent, which will be distributed as follows: 0.66 included. Enterprises must, however, initiate among the weakest social groups; this would per cent on 1 April 1995, 0.78 per cent on 1 pilot schemes to increase employment be completely unacceptable. However, the April 1996, and 0.78 per cent on 1 October amongst those groups of young people who activation system and unemployment-benefit 1996. The remaining 1.28 per cent are set aside find it difficult to gain a foothold within the system should be structured in a way which for pensions and other schemes. Moreover, the labour market. means that taking a job or an education will local-pay scheme is repealed in favour of always be beneficial in financial terms. It is decentralised pay. There are maximum limits on 6 March Amendments to the EMS recommended that more effective and local-authority expenditure on decentralised As a result of the currency-rate adjustments efficient testing of the regulations governing pay. As of 1 April 1995, the upper limit is 0.6 per adopted within the European Monetary System labour-market availability be carried out. cent of the total payroll costs. On 1 April 1996, (EMS), the central rates for the Spanish peseta − Taxation: the Danish taxation structure this figure is increased to 0.8 per cent. Em- and the Portuguese escudo have been devalued presents two significant problems: the high ployees contribute 0.48 per cent to this schemes, by 7.00 and 3.50 per cent, respectively. marginal tax rates and the comparatively while employers contribute 0.32 per cent. A new This results in the following intervention rates large income tax burden placed on low- feature of this decentralised pay scheme is that for the Spanish peseta and the Portuguese income groups. The high levels of unem- it can also be used for reorganisational purposes escudo between the Danmarks Nationalbank ployment amongst low-income groups and and supplementary training. The greatest and foreign-exchange dealers. those with low-level education might speak innovation of this agreement is the introduction Buying rate: DKK 3.8614 per 100 ESP in favour of lowering taxes on low incomes. the "child care days" scheme, which enables Buying rate: DKK 3.2046 per 100 PTE Public finances, however, require full fun- parents to take ten days off work per child to Asking rate: DKK 5.2064 per 100 ESP ding. This indicates a need for long and care for their children. The present pay- Asking rate: DKK 4.3210 per 100 PTE thorough preparation of the next tax reform. adjustment scheme continues, albeit with The intervention rates for the German Deutsch- − Leave schemes: the Commission proposes a amendments, thus ensuring that pay rises within mark, French franc, Belgian franc, Dutch guilder, reform of the leave schemes for education the private labour market will automatically oc- Irish punt, and Austrian schilling remain un- and childcare, as well as an abolition of the casion pay rises for employees within the public altered. sabbatical leave scheme. sector. The new collective agreement also ex- This adjustment means that the central rates in − Transfer payments: the weakest point of the tends the scope of pension schemes for emplo- relation to ECU are changed for all EMS curren- Danish economy is the high level of yees who do not have full pension schemes as cies. The new central rates are as follows: unemployment and the large cost of transfer yet; contributions are increased by 2.4 per cent. Denmark ECU 1 = 7.28580 DKK payments. The Commission considers these Germany ECU 1 = 1.91007 DEM large costs to be symptoms of more funda- 20 February Collective agreement within France ECU 1 = 6.40608 FRF mental weaknesses in the Danish economy. the industrial sector Belgium ECU 1 = 39.3960 BEF They may also be symptoms of attitudes The Confederation of Danish Industries and the The Netherlands ECU 1 = 2.15214 NLG which have been partly created by the wel- Central Organisation of Industrial Employees in Ireland ECU 1 = 0.792214 IEP fare system and the long period of recession. Denmark enter into a collective agreement, Spain ECU 1 = 162.493 ESP − The service sector: the service sector presents which is valid for the next three years. This Portugal ECU 1 = 195.792 PTE great potential for employment. It is agreement entails the following increases to the Austria ECU 1 = 13.4383 ATS recommended that the demand for services minimum wage: DKK 1.60 as of 1 March 1995, The British pound, Greek drachma, and Portu- be stimulated - e.g. by means of target- DKK 1.75 as of 1 March 1996, and DKK 1.60 as guese escudo do not participate in this monetary specific subsidies such as the home-help of 1 February 1998. In addition to this, wage ne- system; the theoretical central rates for these scheme. Emphasis should also be placed on gotiations will take place at individual work- currencies are as follows: education of service employees. The interplay places. The agreement also includes the follo- Great Britain ECU 1 = 0.786652 GBP between the public and private sectors must wing elements: Italy ECU 1 = 2106.15 ITL − be increased within welfare service. Pensions: pension contributions are increa- Greece ECU 1 = 292.867 GRD sed by 0.6 per cent on three occasions: 1 1 June Tax and duty amendments March 1995, 1 March 1996, and 1 March 23 May Tryg takes over Baltica The Danish Parliament adopts a series of 1997; employers pay 0.4 per cent, employees The Tryg insurance company acquires the amendments regarding taxes and duties: as of 1 the remaining 0.2 per cent. insurance company Baltica from Den Danske January 1996, petrol duties increase by DKK − Nuisance bonuses are increased by 6.0 per Bank This makes the Tryg-Baltica insurance 0.17. The old Act on inheritance taxes and gift cent and apprentice rates are increased by company the largest insurance company in taxes is repealed, and is replaced by a new esta- 6.2 per cent. Denmark. te tax and a supplementary tax. The inheritance − Working hours: working hours can become tax hitherto in force is replaced by the estate more flexible if employees agree to this. In tax, where estates are taxed 15 per cent after a future, it will be possible to calculate the deduction of a DKK 180,000 basic allowance. average working week over a period of six Inheritances for more remote blood relatives and

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organisations will also be subject to a decision was also made to initiate police colla- for up to three years, and the job can be supplementary tax of 25 per cent. The taxation boration under the auspices of Europol, whereas combined with training. base for this supplementary tax is the amount the debate on an extension of jurisdiction of the − The opportunities for making up to DKK left after allowances and inheritance taxes. European Court of Justice was postponed for a 40,000 a year without occasioning benefit Inheritance and gifts between married couples year. The EU Member States also decided to cuts during the first period are repealed. are completely exempt from tax. As regards allocate, over the course of the next five years, − The benefit scheme for entrepreneurs is gifts, parents may each give their children and approximately DKK 190 billion to Eastern and abolished as a right; it does, however, re- grandchildren tax-free gifts up to an amount of Central Europe, the Mediterranean area, and the main an option. DKK 40,000 a year per recipient. A 15 per cent 70 countries which fall within the scope of the − The transitional benefits for unemployed tax is charged on gifts which exceed this Lomé Convention. Eleven applicant states parti- individuals within the 50-59 age bracket are amount, the taxation base being the value in cipated in this summit; however, the Heads of repealed as of the turn of the year. However, excess of DKK 40,000. (No. 426/14 June). State and Government from the 15 EU Member unemployed individuals who turn 50 in 1996 It becomes possible to carry out premature with- States did not advance any new estimates on and meet the relevant criteria can qualify for drawals of capital pensions. A 60 per cent tax when new countries can accede to the EU. transitional benefits by submitting their will be charged on pension funds which are applications before the turn of the year. withdrawn prematurely. This does not, however, 24 August Finance Act proposal (Budget) − More opportunities for flexible work, gradual apply to pension funds which are withdrawn du- The Minister of Finance introduces a Bill No. L retirement, and light duties must be created ring parental leave, educational/training leave, 266 of 24 August: the 1996 Finance Act. for unemployed high-risk groups and elderly or sabbatical leave. In such cases, normal in- individuals. 26 September Bank merger come taxes will apply to the amounts with- − A proposal is submitted for increasing the Bikuben and Giro Bank announce their plans to drawn. (No. 431/14 June). requirements stipulated for minimum mem- merge in 1996. bership numbers for unemployment insuran- 2 June Tax/duty amendments 3 October Government policy statement ce funds, so that this minimum is raised to The Danish Parliament adopts a series of levies The Danish Parliament is back in session, open- 50,000 members. which constitute a part of the agreements on ed by a policy statement from the Prime The opening statement also includes policy sta- green taxes: a new sulphur tax of DKK 20 per Minister. The main issue of this opening state- tements such as the following: kilogram of sulphur is introduced. This tax ment is a labour-market reform involving a shor- − The state is to pay contributions to the Da- applies to sulphurous fuels and propellants, and ter period of right to receive unemployment nish Labour Market Supplementary Pension thus extends to both mineral oil products, coal, benefits and more efficient and effective activa- Scheme for cash-benefit claimants, and and natural gas as well as wood, hay, and tion measures. This labour-market reform is to unemployment-benefit claimant contribu- waste. Fuels with sulphurous contents of less be completed in 1998. The main elements of the tions are to be doubled. than 0.05 per cent are exempt from taxation, reform are: − As of 1 January 1996, the registration fee for which means that petrol, paraffin oil, and light − The age limit with regard to unemployment registration in the Land Registry is increased diesel are exempt. From 1 January 1996 to 31 benefits is increased: unemployment-benefit to DKK 900, and the excise duty on compact December 1999, electricity generation will be claimants must now be 18 rather than 16 discs is repealed. exempt from the sulphur tax. (No. 421/14 June). years of age. − The home-help scheme will continue with a A new CO2 tax is introduced on natural gas and − All individuals without qualifications under view to creating more jobs for those with town gas. This tax will be introduced gradually the age of 25 must be offered at least 18 short-term education. during 1996-97 and take full effect in 1998. This months of education/training after a six- − State export credit must be rendered simpler, will not, however, apply to a number of power month unemployment period. more effective, and more efficient with a plants. This tax corresponds to a cost of DKK − If the young person in question refuses this view to providing Danish enterprises with 100 per tonne of CO2. This affects consumers by educational offer, the right to receive unem- guarantees and financing opportunities in increasing the cost of natural gas by DKK 0.22 ployment benefit is forfeit, and they will be line with those of their foreign competitors. per cubic metre. (No. 420/14 June). referred to the cash-benefit system. Within As a result, the Danish Export Credit Fund is Taxation of energy-efficient and energy-inten- this system, activation is extended from six set up under the auspices of the Ministry for sive processes is restructured. As of 1997, to eighteen months. Trade and Business. taxation on energy consumption for energy- − The current unemployment-benefit period − The Housing Benefits Act is amended with a efficient processes is increased annually by DKK comprises two parts, with the first part view to reduce the growth in public expendi- 10, from the current DKK 50 per tonne of CO2 to lasting four years and the second part lasting ture on housing benefits. DKK 90 per tonne of CO2 in 2000. In practical three years; both part periods can be − Radio Denmark and TV 2 will have the terms, this is done by reducing reimbursements extended by an educational leave period opportunity to establish satellite channels. from the existing 50 per cent to 10 per cent in with a duration of up to one year, thus the year 2000. The annual reduction will be 10 26 October Amendment to the tax ceiling bringing the entire period up to a total of per cent per year, with the first reduction taking The Danish Parliament adopts an amendment to nine years. The government proposes that place on 1 January 1997. The taxation rate for the Personal Income Taxation Act with a view to the first part be shortened from four to two energy-intensive processes will be increased by bringing about a slight reduction in the tax years, whereas the second part will retain its an annual DKK 5 per tonne of CO2 until the ceiling: while the tax reform stipulated that this three-year duration. This means that unem- level of taxation reaches DKK 25 per tonne in tax ceiling was to be lowered from 63.5 per cent ployment-benefit claimants will be under an 2000. In practical terms, this is done by carrying in 1995 to 61 per cent in 1996, this amendment obligation to commence education or a job out gradual reductions to the relevant reim- means that the tax ceiling will only be lowered offer no later than after two years on bursements from 95 per cent in 1996 to 75 per to 62 per cent in 1996. unemployment benefit. During the last three cent of the CO2 tax in 2000. (No. 417/14 June). years, permanent activation will be required, A new tax on natural gas and town gas is intro- 29 November Agreement on the Finance Act and it will not be possible to extend the duced. This tax amounts to DKK 0.01 per cubic The government enters into an agreement with unemployment-benefit period by means of metre of standard natural gas. For taxable gas the Conservative Party on the 1996 Finance Act. leave for education or training. used as motor fuel, the tax is DKK 2.31 per cubic This agreement includes the following elements: − Special job schemes or pools are to be metre of gas. (No. 419/14 June). the unemployment-benefit period is reduced established with regard to the environment The payroll tax is increased as of 1 January from seven to five years. Even where unem- and public care, and possibly within the 1997. However, these increases will not take full ployed individuals have not received an offer cultural sphere as well. These pools will effect until the year 2000, thus coinciding with a after five years, this period cannot be extended. eventually replace the familiar vocational concurrent reduction in labour-market contri- With regard to unemployment-benefit claimants training positions. This might entail the butions. (No. 423/14 June). under the age of 25, the following regulations creation of up to 25,000 jobs within these apply: the lower age limit for admission to an 27 June EU Summit in Cannes job pools. The objective for 1996 is to create unemployment insurance fund is raised to 18 At an EU Summit in Cannes, the 15 Member 10,000 jobs of this type within local authori- from 16 years. Young unemployed people who States agree to postpone the commencement of ties and 5,000 jobs at state level. The have had no work for six months within a nine- the final stage of the Economic Monetary Union unemployed can hold a job from this job pool month period must accept an offer of education (EMU) by two years until 1 January 1999. A or training for a minimum period of 18 months.

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In the event that they refuse this offer, their exempt from taxes. Moreover, there are signs 14 December Peace agreement is signed right to receive unemployment benefit is forfeit, that the European Commission will accept a The peace agreement for Bosnia is signed in and they are referred to the cash-benefit system. special tax reduction for petrol sold from Paris by the presidents of Bosnia, Serbia, and As regards to unemployment-benefit claimants environmentally-friendly petrol stations. Croatia. over the age of 25, they have a right and obli- (No. 1101/20 December) gation to receive a three-year activation offer As of 1 January, excise duties on compact discs 14 December Adoption of the Finance Act after two years of unemployment. Such acti- are repealed, while the duties on tobacco and The government parties, the Danish Liberal vation offers may involve education and/or trai- cigarette paper are increased; this causes the Party, and the Conservative Party adopt the ning, or they may take the form of so-called price of a home-made cigarettes to increase by 1996 Finance Act. The Socialist Peoples’ Party, pool jobs: public-sector jobs within the environ- DKK 0.07 - 0.11. (No. 1103/20 December and the Progress Party, and the Danish Red-Green mental area or as care providers. The pay cor- No. 1090/20 December) Alliance vote against the Act. responds to the relevant contractual wages and The regulations governing settlement of corpo- The total revenues within the operating budget, salaries within the relevant area, but cannot ration taxes and pension taxes between the public works budget, and lending budget for exceed the maximum unemployment-benefit state and local authorities are amended as of 1 1996 are estimated at DKK 355.5 billion, and rate. With respect to cash-benefit claimants January. This entails that local authorities will the total expenditure, including interest on under the age of 25, individual action plans receive an advance payment with respect to national debt, is estimated at DKK 384.3. The must be prepared. Such action plans should aim corporation taxes, pension taxes, etc.; this ad- corresponding figures for 1995 are estimated at to induce the young person in question to vance payment will correspond to the amounts DKK 351.7 billion and DKK 388.1 billion, acquire an education. For young people with no featured in the local-authority budgets. Final respectively. The gross public-sector borrowing vocational training, the duration of activation settlement is postponed until two years after the requirement (gross cash deficit) for 1996 is offers is extended from six to eighteen months. advance payment was made; adjustments are expected to be DKK 130.0 billion, with the During activation, participants will receive a then made on the basis of the actual accounts. corresponding 1995 figure being DKK 170.2 maximum benefit of DKK 5,600 a month (cash (No. 1078/20 December) billion. benefit plus an additional activation bonus of The triviality limit with regard to housing The 1996 Finance Act estimates that the no- DKK 8 per hour. This bonus has been halved). In benefits is increased from DKK 900 a year to minal national debt (without deductions for the order to qualify for the cash-benefit rate for DKK 2,000 a year. Housing benefits for home assets of Den Sociale Pensionsfond ["the Social adults (DKK 6,803 per month), the under-25s owners are also restructured, so that the entire Pensions Fund"]) will amount to DKK 763.8 must have had eighteen months of unemploy- benefit is converted into a loan option. Until billion at the end of 1996; the corresponding ment, rather than the current twelve months. now, 80 per cent of this benefit has been paid figure at the end of 1995 was DKK 734.0 billion. Cash-benefit claimants over the age of 25 may out as a loan and 20 per cent as a grant. The interest burden on this debt is estimated at receive the DKK 8 activation bonus in addition Housing benefits for OAPs living in housing co- DKK 60.6 billion in 1996; the corresponding 1995 figure being DKK 58.9 billion. to the cash benefit during activation. An action operatives, etc., are restructured so that 40 per plan must be prepared no later than after six cent is a grant and 60 per cent is an optional 16 December EU Summit in Madrid months on cash benefit. After this period, cash- loan. (No. 1067/20 December) At the EU Summit in Madrid, the 15 Member benefit claimants are entitled to participate in The scheme on private urban renewal will States agree that the name of the single EU adult education and supplementary training. The continue to the year 2000 with annual funding currency will be the Euro. No agreement is transitional benefits for unemployed individuals to the amount of DKK 0.8 billion. reached on the issue of when accession within the 50-59 age bracket are repealed as of (No. 1069/20 December) negotiations with the 12 applicant countries 31 December 1995. However, unemployed indi- In future, early-retirement benefits will not be from Eastern and Central Europe are to open. It viduals who turn 50 in 1996 and meet the rele- backdated, and the age limit with regard to re- is, however, agreed that accession negotiations vant criteria can qualify for transitional benefits habilitation benefits is increased from 23 to 25 with Malta and Cyprus can be opened in 1998. by submitting their applications before the 31 years: claimants below the age of 25 will receive January 1996. 50 per cent of the normal rehabilitation-benefit (No. 1058-1059 and 1112-1113/20 December) rate. 1996 Persons who find themselves unemployed on a A five-year agreement on Danish defence entails temporary or more long-term basis must now rationalisations to an amount of DKK 800-900 15 March Spies-Tjæreborg is sold pay contributions to the Danish Labour Market million in relation to 1994 levels. The Odense The Spies-Tjæreborg travel agency is acquired by Supplementary Pension Scheme to a much larger and Randers barracks will be closed down, and the Scandinavian Leisure Group, thus coming extent than was previously the case. For the standing force is set at 58,000 men. under British ownership. example, this applies to persons claiming transi- A four-year agreement on the police force has tional benefits, early retirement benefits, partial been entered into; this agreement means that 27 March EU export ban pension, and cash benefits. At present, these the current size of the police force is maintained. The European Commission adopts a world-wide groups do not contribute to the Danish Labour After the turn of the year, students who receive ban on export of British beef products.

Market Supplementary Pension Scheme (ATP), student grants (SU) are allowed to make an 30 March EU Summit in Torino nor to any labour-market pension scheme. This additional DKK 1,000 a month without occasio- At the EU Summit in Torino, the 15 Member Act enters into force at the turn of the year; ning cuts in their grant. Students are henceforth States debated the document for the govern- certain exceptions do, however, apply, and some allowed to make a total of DKK 4,587 a month ment conference, which is to take the objectives elements within this Bill require two-year without losing any of their student grant. of Maastricht further and pave the way for a gradual introduction periods. 5 December VAT and customs duty amendments new Treaty on the European Union. The coming (No. 1057/20 December) negotiations, which take place under the The capital tax rate is reduced from 1 per cent to As of 1 January 1996, the Danish Parliament adopts a series of amendments with respect to heading "Government Conference", are expec- 0.7 per cent, and the basic allowance with ted to last for the next 15 months, and as yet regard to this tax is increased from DKK 1.6 VAT and customs duty to approximate legisla- tion within these areas to accommodate a the only point of agreement is that the most im- million to DKK 2.4 million. The capital tax is portant task of this Government Conference will repealed completely as of 1997. simplification directive from Brussels. In special cases, enterprises need no longer register for be to prepare the accession of the 12 applicant (No. 1105/20 December) countries from Eastern and Central Europe. As of 1 January, the standard allowance for VAT in other EU Member States, thus saving owner-occupied homes is increased from DKK administration costs. The limit for adjustments 3 April Destruction of British cattle herds 2,000 to DKK 3,000. (No. 1107/20 December) to the VAT receivable on capital goods is in- The EU decides that 4.7 million British cattle As of 1 January, insurance companies and pen- creased from DKK 50,000 to DKK 75,000. Regu- must be destroyed within a 30-month period. sion funds will only have one month to pay lations are also eased for customs duties. If ne- The EU will pay 70 per cent of the cost of this taxes to the state when paying out capital cessary due to financial reasons, goods from destruction, while Britain is to pay the remaining pensions. (No. 1106/20 December) third-party countries outside of the EU may now 30 per cent. The cost of just slaughtering the A number of amendments are made to the be stored by the recipient without having had cattle is estimated at DKK 20 billion. VAT and excise duties levied on them. legislation on energy taxation and the CO2 tax. Among other things, energy taxes will be levied 16 April Government presents new energy plan on bitumen, tallow oil, wood tar, pitch, etc., The Danish government presents a new action when used as fuel. Coal for steam ships is plan for the energy of the future. The

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government retains the overall objective of Commission means that car importers can no with benzene contents is presented, and reducing CO2 emissions by 20 per cent by the longer determine fixed sale prices for new cars, farmers are no longer to have access to tax year 2005 when compared to emission levels in and thus can no longer report such prices to the exemptions on petrol. 1988. The government will work to ensure that tax authorities. As a result, the provisions on − New legislation on environmental issues is to agreements are entered into with the car reporting fixed prices which cannot be exceeded be introduced. This so-called "Law and industry at EU level with a view to ensuring that have been amended so that it becomes possible Order"- scheme will comprise opportunities CO2 emissions from new cars are reduced by 25 to submit notification of prices which can be for revoking authorisations for contamina- per cent by the year 2005. New cars are to be used as the taxable value of the vehicle, but ting enterprises, sentences of up to four even more energy-efficient than before, and a which are not set. It has also been decided that years in prison for gross violations of envi- new type of vehicle excise duty is to be when vehicles are sold at prices greater than ronmental regulations, more rigorous rules introduced which favours energy-efficient cars. those reported to the tax authorities, the higher on accountability and responsibility in con- The energy plan also comprises proposals for amount constitutes the tax base. nection with issue of authorisations, and more effective use of the energy systems, (No. 489/12 June) improvements to local-authority and state increased use of sustainable energy sources, and supervision on environmental issues. proposals for greater efforts to induce consu- 31 May Permanent home-help scheme − DSB (the Danish National railways) are to be mers to conserve energy. The home-help scheme - which has made it reorganised. The government presents plans possible to receive subsidies of DKK 85 an hour for a series of initiatives - patterned on the 23 April Amendments to pension schemes for services such as cleaning, cooking, and other Swedish model - to divide the Danish natio- The Danish Parliament adopts a series of a- domestic chores - becomes permanent. The nal railways into two parts: an organisation mendments to the pensions. These amendments subsidy is amended so that customers must pay in charge of the railway tracks, and an include the following elements: 50 per cent of labour costs themselves, and the − independent traffic company. Such a division In future, an employee's former employer maximum subsidy per household per quarter is will also entail consequences to DSB will be entitled to make tax-free payments of DKK 10,000. The process of settlement between payments for its share of the Great Belt e.g. severance pay to the employee's annuity customers and enterprises is also amended. bridge and tunnel; these costs would not pension scheme or capital pension scheme. Customers must now pay their share of the cost − affect the traffic company. The regulations on the distribution of annuity by means of giro, and enterprises will receive − New quality labels are to be introduced. pension schemes or capital pension schemes the state subsidies from the Danish Commerce These labels will guarantee that labelled in connection with divorce are amended. and Companies Agency. (No. 463/12 June) food products have been produced without Among other things, this means that the 1 October The government's policy statement the use of growth stimulants and comply party who receives the settlement after the with a series of requirements with regard to administration and distribution of the joint The Danish Parliament is back in session and is opened by the Prime Minister's opening speech. health, animal welfare, and quality. property will retain their right to make tax- − The main themes concern initiatives to combat The Danish "lurmærke" (lur brand) is to be deductible deposits to their part of the privatised in order to prevent manufacturers pension scheme. violence and crime and modernisation of the welfare society and the public sector. The most from other EU countries from using this label. − More flexible opportunities for the placement − important policy statements in the speech ad- The temporary ban on the building of new of pension funds in connection with job shopping centres is to be replaced by an changes are created. dress the following issues: − − A revision and restructuring of the amendment to the Planning Act which is to On certain conditions, policy-holders become instruct local authorities and counties to entitled to make tax deductions for deposits Bistandslov ["the Social Security Act"]. It is proposed that this Act be divided into two promote decentralised outlet patterns which made to disability-insurance schemes with ensure that city centres retain their central general insurance companies during the separate Acts: one on active social policies and one on social services. The former Act is position. 1996 income year. (No. 312/24 April) − to comprise cash benefits, activation sche- Women are to be able to enter compulsory 29 April B&W goes bankrupt mes, etc., whereas the latter comprises regu- military service on the same terms as for men. Burmeister & Wain submits a bankruptcy lations on service as laid down in the Social petition to the Bankruptcy Court in Copenhagen. Security Act. 2 October Finance Act proposal (budget) − A scheme similar to the early-retirement 14 May Restructuring of alcohol duties The Minister of Finance introduces Bill No. L 1 of benefit scheme should be introduced for 2 October: the 1997 Finance Act. As of 1 July 1996, the Danish Parliament those who have held part-time jobs due to reduces alcohol duties by DKK 17 per litre and reduced work ability and thus do not qualify 14 October Finland joins the EMS increases taxes on beer and wine: the cost of a for early retirement. Long-term membership 30-bottle crate of beer will increase by DKK As of 14 October, the Finnish markka enters the of an unemployment insurance fund will be European Monetary System (EMS) with fluct- 1.15, whereas wine will cost an additional DKK required in order to qualify for this benefit 0.25 (approx.) per bottle. − uation margins of 15 per cent each way. In this The regulations on "light jobs" for those connection, intervention rates have been stipu- 31 May Tax amendments with special needs are to be improved. The lated for the Finnish markka in relation to the The Danish Parliament adopts a series of tax state is to relieve counties of their share of other participating currencies. Intervention rates amendments: a new sewage tax is introduced. the funding of light jobs within the public for the Danish krone are as follows: This tax comprises all common sewage-treat- sector, while the responsibility for estab- Buying rate: DKK 108.057 per FIM 100 ment plants, single-source discharges within the lishing these positions is to be relegated to Asking rate: DKK 145.699 per FIM 100 industrial sector, and properties which discharge the local authorities. − The ECU central rate for the Danish krone sewage outside the common sewage plants. The The Act on individual housing benefits is to remains unaltered: ECU 1 = DKK 7.28580 DKK. liability to pay tax comprises the final discharge be amended. This amendment will entail a The intervention rates between the other of sewage to watercourses and oceans and simplification of local-authority administra- currencies which participated in the EMS prior to percolation. The amount of sewage discharged tion of the complex benefit regulations as this date also remain unchanged. is mainly established by means of measurement, well as a reduction in the growth of the costs but regulations have also been adopted on for individual housing benefits. The objective 24 October Agreement on the Danish standard determination of discharge amounts is to target affluent OAPs, etc. National Railways (DSB) − for smaller sewage-treatment plants. Moreover, A scheme is to be established to enable local The government parties, Venstre (Denmark’s discharges from fish farms and mussels-cleaning authorities to test various methods for Liberal Party), and the Conservative Party enter plants can under certain conditions be exempt allocation of council housing, etc. This will into an agreement on the Danish national rail- from tax, and less rigorous regulations apply to provide local authorities with a tool to ways which entails a division of this organi- sewage-treatment plants which have estab- prevent certain areas from becoming immi- sation into two parts: a railway section and an lished pools which prevent overflow outside grant ghettos. operations section. The inter-city trains (IC3) and − these plants. (No. 490/12 June) Vehicle taxes are to be restructured. A new so-called S trains (local-traffic trains in the Taxes on new cars have hitherto been levied on periodic duty on new passenger cars is to be greater Copenhagen area) are grouped in two the basis of sales prices which have been tied in with fuel consumption; this duty will independent companies, while the state retains determined in advance. However, the adoption replace the vehicle excise duty. A proposal regional traffic and freight trains. The railway of a new regulation issued by the European for differentiating petrol taxes in accordance tracks will fall within the auspices of a special

b b 188 Political-economic calendar

National Railways Agency, and outsourcing will employment, continue their training without 30 December Reformation of the government take place within many areas, so that foreign losing their right to unemployment benefits. Following the decision made by the Centre De- service providers may also operate on Danish − Local-authority employers will have access to mocrats to step down from the government, the rails. This agreement entails the investment of applying for subsidies for the purpose of Prime Minister (Poul Nyrup Rasmussen) forms a DKK 15-20 billion on projects and schemes such establishing normal jobs for long-term un- new minority government comprising the Social as an extension of the Frederikssund railway, employed participants in the so-called "pool Democratic Party and the Social Liberal Party. modernisation of the Aarhus-Fredericia tracks, job" schemes. It is expected that 4,000 indi- purchase of new high-speed trains, and im- viduals affected by long-term unemployment provements to rails within the Copenhagen will obtain permanent employment, pre- 1997 area. The agreement also includes a stipulation sumably centred on day care and care for the of user fees for the use of the Great Belt bridge elderly. 21 February Collective agreement and tunnel, which means that passenger cars − Casual labourers who find themselves unem- for state employees and lorries will pay approximately 20 per cent ployed and taking part in an activation The state employees, as represented by the Joint less than was hitherto planned. scheme must have better opportunities for Committee of the Central Organisations, agree taking on casual labour without suffering ad- on a settlement with the Danish Minister of 25 November Italy re-enters the EMS verse effects to their position within the Finance. The overall pay framework for the two- As of 25 November, the Italian lira is once again unemployment-benefit system. year agreement period constitutes 4.25 per cent. part of the European Monetary System (EMS) − The working environment must be improved Of this figure, 2.9 per cent is set aside for with fluctuation margins of 15 per cent either by means of rewards for employers who car- general pay rises, which will occur on the way. In this connection, intervention rates have ry out measures to prevent accidents, etc. following dates: 1 April 1997 (0.5 per cent), 1 been stipulated on the lira in relation to the − Steps must be taken to support entre- April 1998 (0.9 per cent), and 1 October 1998 other EMS currencies. For the Danish krone, the preneurs. Funds are set aside for new initia- (1.5 per cent). The remaining 1.35 per cent have intervention rates are as follows: tives regarding small and medium-sized en- been earmarked for special purposes such as Buying rate: DKK 0.33181 per ITL 100 terprises; this includes a new scheme on improvements to pension schemes, supplemen- Asking rate: DKK 0.44740 per ITL 100 capital contributions to entrepreneurs. tary training, regulations on special benefits, The re-entry of the lira entails changes to the − Overtime within the state sector and local and restructuring. The agreement also maintains central rates in relation to the ECU for all EMS authorities must be limited by introducing a the automatic adjustment scheme, which currencies. The new central rates are as follows: tax on paid overtime. This tax is calculated provides state employees with an annual pay Denmark ECU 1 = 7.34555 DKK as a percentage of payments made by rise (on 1 April) if their pay has failed to keep up Germany ECU 1 = 1.92573 DEM ministries for overtime and extra work, and with those found within the private labour France ECU 1 = 6.45863 FRF will be paid from the funds set aside by market. Moreover, the agreement comprises a Belgium ECU 1 = 39.7191 BEF individual institutions for other operating framework agreement on pilot projects with The Netherlands ECU 1 = 2.16979 NLG expenses. An overall reduction in overtime of regard to new pay systems. The trial period Ireland ECU 1 = 0.798709 IEP 30 per cent is expected. Such a reduction will commences on 1 January 1998 and is expected Spain ECU 1 = 163.826 ESP release DKK 160 million, which can be used to end on 31 March 2001. The idea is that cross- Portugal ECU 1 = 197.398 PTE to employ more people on normal terms. functional personnel groups within ministries Austria ECU 1 = 13.5485 ATS − Starting on 1 January 1997, the Danish state and agencies or all personnel within individual Finland ECU 1 = 5.85424 FIM will collect DKK 100 million of the interest agencies can sign up to participate in these pilot Italy ECU 1 = 1906.48 ITL accrued on the large unclaimed holiday schemes. The participating parties can then The British pound and Greek drachma do not funds which are administered by the Labour enter into agreements on pay systems which are participate in this monetary system; the theore- Market Holiday Fund. This Act also entails founded on a fixed base pay plus additional pay tical central rates for these currencies are as provisions to the effect that part of the which may be allocated as function-related pay, follows:: holiday allowances which people forget to performance-related pay, etc. It has also been Great Britain ECU 1 = 0.793103 GBP withdraw before the end of the holiday year agreed to complete the pension schemes which Greece ECU 1 = 295.269 GRD will be claimed by the Danish state. were initiated in 1989 to full term. On 1 October 28 November Agreement on the Finance Act (No. 1199 of 27 December) 1997, total pension contributions for state − The government enters into an agreement with A number of amendments are carried out for employees which fall within the scope of these the Socialist Peoples’ Party on the 1997 Finance various regulations on energy levies. For schemes will amount to 12 per cent of their pay. instance, waste taxes are increased by DKK Act. This agreement includes the following ele- 27 February Local-authority collective agreement 50 per tonne, and taxes are introduced on ments: Local government employees, as represented by sludge which is incinerated at sewage − The gross tax is increased from 7.9 per cent KTO (The Association of Local Government treatment plants. (No. 1224 of 27 December) to 8.0 per cent. Employees' Organisations), agree on a settle- − An easing of the CO2 taxes levied on − An additional 2,400 places will be estab- ment with local-authority employers. refineries which entails that their use of lished within higher education. These increa- The overall pay framework for the two-year taxable products in connection with manu- sed admission rates will be centred on the agreement period constitutes 4.25 per cent. Of facturing processes are exempt from taxa- pedagogic area, but the humanities, social these funds, 2.95 per cent are set aside for tion. This does not, however, apply to the sciences, and natural sciences are also general pay rises, which will take place on 1 use of mineral-oil products and gas when included in this scheme. April 1997 (0.5 per cent), 1 April 1998 (0.95 per used as motor fuel. (No. 1220 of 27 Dec.) − Pay subsidies are grated for enterprises cent), and 1 October 1998 (1.5 per cent). The − The tax exemption hitherto in force on ener- which employ adult (mature) trainees. The remaining 1.3 per cent have been earmarked for gy taxes levied against coloured petrol used number of trainee positions for adults is to a number of special purposes: decentralised pay, within agriculture, forestry, etc., is repealed. be increased by at least 2,000. new types of pay, extra pay rises for manage- (No. 1214 of 27 December) − Disadvantaged young people and young im- ment and middle management, extension to the − The electricity tax is increased by a so-called migrants must have better opportunities for pension schemes for trade unions under the "electricity-conservation tax" to the amount securing trainee positions. This is to be done auspices of the Danish Federation of Trade of DKK 0.006 per kWh. This means that the by means of increased efforts at the public Unions, and for special negotiations carried out electricity tax on electricity used for heating employment service and by rewarding by individual trade unions. The so-called adjust- permanent residences will be DKK 0.401 per employers who establish trainee positions. ment scheme is maintained, occasioning a gene- kWh; for electricity used for any other − The financial situation of daytime folk-high ral pay rise of 1.1 per cent on 1 April 1997. The purpose, this figure will be DKK 0.466 per schools is to be improved by means of in- framework for a new pay system has also been kWh . (No. 1211 of 27 December) creases to the subsidies granted in connec- established. As of 1 April 1998, it becomes − The subsidy for power plants which manufac- tion with activation of the unemployed at possible for organisations, trade unions, or ture electricity by means of decentralised such institutions. personnel groups to transfer to a pay system combined heat/power generation based on − Employed individuals over the age of 25 who which comprises basic pay with opportunities natural gas or industrial CHP generation attend supplementary training in the form of for pay improvements by means of function- based on natural gas is reduced from DKK evening classes may, in the event of un- related pay, performance-related pay, etc. 0.1 to DKK 0.07 per kWh. (No. 1210 of 27 December)

b b Political-economic calendar 189

8 April Amendments to taxes/duties question. This allowance comes to DKK 4,165 − Users must have greater co-determination As of 1 May 1997, the Danish Parliament increa- for ABS brakes and DKK 1,280 per airbag (up to with regard to the services rendered, e.g. as- ses taxes on beer and wine by almost four per a maximum of four airbags). The regulations on sistance with personal care. Formal com- cent. This amendment entails a DKK 1.15 price profits on vehicles are also amended: a plaints with regard to aid will be facilitated. increase on a crate of 30 bottles of standard minimum value is introduced with respect to the − Day-care institutions are reminded of their lager, whereas the tax increase on wine will taxable value of retailers' purchase prices plus 5 obligation to adhere to the official waiting come to nearly DKK 0.25 for a bottle of table per cent, and profit rates for importers cannot be lists and refrain from relegating particular wine and nearly DKK 35 for a bottle of fortified negative. Finally, the car excise duty is amended groups, such as children of unemployed wine. (No. 275/15 April). to introduce an additional charge of DKK 5,000 parents, to the bottom of such lists. on large vans which are used for private − Parents who are entitled to day care for their 30 April Denmark "2005" transportation; the corresponding rate for small children may elect to receive a The SR government presents a plan for the vans is DKK 1,000. The additional charge for reimbursement of up to 70 per cent of the development of Danish society until the year vans which are used for both private and labour cost of e.g. a nanny instead. However, 2005. Government objectives include the business purposes has been set at 50 per cent. such subsidies cannot exceed 85 per cent of creation of 240,000 new jobs during the next (No. 363/2 June). the cost of the cheapest child-care opportu- eight years, thus occasioning a 5 per cent As of 1 January 1998, Danish tax regulations on nities within the relevant local authority. reduction in unemployment. The total number of air travel will be in line with EU legislation. 3) Act on social administration: transfer-benefit claimants is to be reduced: from Currently, a DKK 65 tax is levied on all − Local authorities and counties must stipulate 920,000 claimants this year to 750,000 passengers departing from Denmark to foreign the shortest time limits possible with regard claimants in the year 2005. Foreign debt must destinations, whereas no tax on domestic airline to administration and case processing. The be repaid before 2005, and public debt must be passenger departures exists. In future, domestic public must have the opportunity to take an reduced from 67 per cent of GDP to airline passengers will also fall within the scope active part in case processing. approximately 40 per cent. As regards the of taxation. As part of the current rigorous − Local authorities and counties must carry out environment, CO2 emissions must be reduced by economic policy, the tax rate per departing more rigorous monitoring and supervision of 20 per cent in relation to 1988 levels. The passenger is increased from DKK 65 to DKK 75. institutions working with e.g. child care, drug government intends to increase the gross tax by This means that the legislation stipulates that a addicts, or the disabled. one per cent per year during the years to come, tax of DKK 75 be paid to the Danish state per 4) The Pensions Act: and to increase green taxes. These tax increases departing passenger, thus occasioning a DKK − Local authorities assume all authority as are to finance a reduction in personal-income 150 tax for domestic round-trip tickets and a regards allocation of early-retirement pen- tax, particularly for low-income groups. DKK 75 tax on round-trip tickets for foreign sions. All opportunities for rehabilitation 5 May Tax package destinations. (No. 449/10 June). must be exhausted before early retirement is Finally, the agreement comprises an increase in awarded. The government enters into an agreement with the Socialist Peoples’ Party and the Danish Red- the land registration fee from DKK 700 to DKK 1,200. (No. 369/3 June). 30 May Tax and duty amendments Green Alliance on a tax package which means The Danish Parliament adopt a number of that transportation by means of domestic flights 15 May New Social Security Act amendments to taxes and duties: and cars becomes more expensive, whereas The government enters into a broad agreement The charges levied on natural gas and town gas travel on trains and buses becomes cheaper. The on new legislation on social security. This are increased from DKK 0.01 to DKK 1.64 per agreement comprises a ten per cent reduction in agreement means that as of 1 July 1998, the cubic metre. However, from the time of entry fare rates which extends to local traffic in 1976 Bistandslov ["Social Security Act"] is into force in 1997 until 31 December 2008, this Copenhagen (trains and buses), interregional replaced by four new social Acts. The main tax will be DKK 1.23 per cubic metre, which trains, private railways, and regional traffic points in these four Acts are outlined below: corresponds to 75 per cent of the final tax rate. companies within counties and local authorities. 1) Act on active social policies: During a transitional period, the five regional The tax package includes the following key − The age limit with regard to activation is natural-gas companies will receive individually elements: the introduction of a so-called green changed to 30 rather than 25 years. Young determined allowances with regard to this vehicle-ownership tax, which is based on the people under the age of 30 must commence charge. (No. 443/10 June). normal fuel (petrol or diesel) consumption of the activation after 13 weeks on cash benefits at The petrol tax is differentiated in accordance car in question. This Act means that new cars the latest. In the event that a person is with benzene content. During a transitional will be divided into approximately 25 categories absent from activation, local authorities can period, from 1 January 1998 to 31 December in accordance with their mileage performance reduce or refuse financial aid. Local 1999, petrol taxes are reduced by DKK 0.04 per per litre of fuel. The difference in tax rates from authorities come under an obligation to litre for petrol with benzene content of less than one category to the next will be between DKK activate all cash-benefit claimants with 1 per cent per litre. For petrol with benzene 400 to DKK 800 per year. This Act applies to problems other than unemployment. content between 1 and 2 per cent, the petrol tax cars which were first registered on 1 July 1997 − Local authorities cannot provide aid where is reduced by DKK 0.02 per litre. No change is or later. (No. 360/2 June). applicants or their spouses have capital made to the petrol tax for petrol with benzene Vehicle-registration taxes and car excise duties which can cover the need. Amounts of up to content between 2 and 3 per cent. The tax is are amended as a result of the green taxation DKK 10,000 per person are ignored. increased by DKK 0.02 per litre for petrol with scheme. Car excise duties are abolished for new − Persons who find themselves on social benzene content between 3 and 4 per cent, and passenger cars; these vehicles will fall within the security cannot be forced to withdraw their by DKK 0.04 per litre for petrol with benzene scope of the new green vehicle-ownership tax capital pensions until a six-month period has content between 4 and 5 per cent. instead. A reduction in the tax allowances elapsed. Capital pensions of less than DKK (No. 450/10 June). hitherto in force for airbags is introduced. The 50,000 are completely exempt from this scale brackets used when calculating vehicle- scheme. 18 June EU summit in Amsterdam registration taxes are increased; this means that − After six months on cash benefit, it will no The Heads of State and Government of the EU the tax on new cars comes to 105 per cent of longer be possible to receive benefits greater enter into an agreement on a new EU Treaty. A DKK 48,800 and 180 per cent of the value in than the maximum unemployment-benefit special Protocol based on the 1992 Edinburgh excess of this figure. (No. 361/2 June) rate. This is to induce the highly paid to Agreement (where the four Danish opt-outs Taxes on vans are restructured, causing the unit become members of an unemployment were established) means that Denmark will be tax on vans to be replaced by a value tax. The insurance fund.. outside future cooperation on defence policies, present vehicle-registration tax of DKK − The scheme for a 50 per cent pay subsidy for asylum policies, and visa policies, to the extent 30,000/19,000 no longer applies to vans. In- "light jobs" for those with special needs is that such cooperation is supranational. Denmark stead, a 30 per cent tax is introduced on the continued. has acceded to the Schengen Agreement, which value which exceeds DKK 30,000 (including 2) Act on social services: will constitute a part of the new EU Treaty. VAT, excluding tax). Also, the tax allowances − In general, users must have greater influence According to the Protocol, Denmark has a time with respect to the vehicle-registration tax for on social services, and it should be very limit of six months to announce whether it will ABS-brakes and other security equipment has simple for users to establish an overview of follow the decisions made by the other countries been restructured, so that deductions are now their rights and obligations. or pursue its own course. In the event that made to the taxable value of the vehicle in Denmark does not comply with the regulations

b b 190 Political-economic calendar

of other countries, it is up to these countries to of their immediate sphere of competence 7 October Announcement of referendum decide whether or not this will have any impact after a period of six months of unemploy- on the Amsterdam Treaty on the open borders between Denmark and e.g. ment. Steps are taken to clarify that retrai- In connection with the opening of the Danish Germany or Sweden. A referendum on the new ning which can increase the possibility of Parliament, the Prime Minister announces that EU Treaty is projected for spring 1998. employment is always compulsory. With a the coming referendum on the Amsterdam Trea- Among other things, the Amsterdam Agreement view to avoiding situations where large diffe- ty will take place on Thursday, 28 May 1998. addresses the following issues: rences exist in unemployment rates between − A common strategy to combat unemploy- neighbouring regions, cross-regional public 10 October Agreement on limitations on ment must be prepared. The EU can contri- employment services are promoted and the private consumption bute to pilot projects on job creation. requirements with regard to geographic mo- As part of the efforts to limit private consump- − The social chapter becomes part of the bility are made more rigorous. tion by means of savings, the government enters Treaty. As yet, the social chapter addresses − The current right to take parental leave with into an agreement with Venstre (Denmark’s Li- the issue of joint maternity/paternity leave pay in the form of unemployment benefit beral Party) and the Conservative Party. This and the issue of employee's right to co- during the first 14 weeks after the child is agreement will be in force in 1998 and includes determination and consultation, e.g. when born is extended from two to four weeks. the following elements: large enterprises face major restructuring − Environmental taxes directed against the Temporary pension savings will be collected processes. agricultural sector must be increased. A bill from employees, self-employed individuals, and − The environmental guarantee, which entitles will be presented on the introduction of a unemployment-benefit and cash-benefit clai- any Member State to maintain stricter envi- nitrogen tax. Also, a "significant increase" in mants. The amount to be collected constitutes ronmental regulations than those of other the tax on pesticides and herbicides is also one per cent of the labour-market contribution Member States, is expanded in scope to in- proposed. Options are also being considered base. An amount of up to DKK 34,500 will be clude public health. with regard to reimbursing taxes on CO2 and exempt from this temporary pension contribu- − Immigration, visa regulations, and asylum SO2 to the agricultural sector. This has tion. An annual amount of DKK 1,300 is deposi- issues become common EU policies. In five hitherto been done by means of reductions ted for unemployment-benefit and cash-benefit years from now, the issue of which decisions to charges with regard to plant and veteri- claimants. The Act entails a transfer of the con- can be made by means of a qualified majo- nary services, but may well - if the agricultu- tributions made from the tax authorities, rity vote will be determined. ral sector so desires - be carried out on the unemployment-insurance funds, and local au- − The EU and the WEU Union will collaborate basis of turnover plus VAT. thorities to the Danish Labour Market Pension closely. However, a merger of the two enti- − The so-called "millionaire break" with regard Fund. In November 1999, the Danish Labour ties is postponed indefinitely. to the rental-value tax on properties is Market Pension Fund will distribute these con- − The President of the European Commission increased, so that the high rental-value tax tributions into separate, individual accounts. must be appointed by the Heads of State and rate (six per cent) will only be levied on the Interest will be accrued on these accounts, and Government of the EU, but must be approved part of the publicly assessed property value the resultant funds will be administered separa- by the European Parliament. The number of which exceeds DKK 2.1 million. tely from the Danish Labour Market Pension EU Commissioners will remain 20; this − Private employers must pay sickness benefits Fund’s common capital. At retirement age, 67 means that the major Member States will for a period of three weeks rather than the years, the funds in these individual accounts will surrender their second Commissioner when current two weeks. At the same time, em- be paid out to the relevant account holders. In the EU accepts new Member States. To com- ployers will have the opportunity to choose the event of death before retirement age, the pensate for this, however, voting procedures whether they wish to pay the cost of sickness account funds are paid out to the estate. will be amended to provide the major Mem- benefits for the first two days of absence due (No. 803/24 October). ber States with greater influence. to sickness themselves, or if they wish to pay It will be possible to establish home-savings higher premium rates to the insurance sche- accounts with up to ten years of tax exemption 26 August Finance Act Proposal (Budget) mes instead. on the accumulated interest. The scheme stipu- The Minister of Finance introduces Bill No. L 1 of − Buying and selling your own home should be lates that the maximum deposit per person for 26 August 1998: the 1998 Finance Act. such accounts is DKK 12,000 for 1998, while the easier and cheaper. This is to be effected by means of a number of amendments to the minimum deposit is DKK 1,200. The objective of 7 October The government's policy statement this home-savings account must be to purchase The Danish Parliament is back in session and is legislation governing property trade, amend- ments which are to be based on the cata- a home or land on which such a home is to be opened by the Prime Minister's opening speech. built; the account funds may also be used to pay With a view to reducing economic activity and logue of ideas which were presented by a working group in February. Paperwork deposits or advance rent for rented housing, or prolonging the period of economic recovery, the to purchase shares in companies, societies, etc., government wishes to implement a series of should be simplified, costs should be brought down, and market transparency should be which offer right of use on a permanent resi- initiatives to promote private and public saving. dence. No deposits may be made to this account The most important policy statements in this increased by introducing a rule which stipu- lates that all properties which are put up for after 1998. The amount saved may not be with- speech are listed below: drawn until a three-year period has elapsed af- − A special 1 per cent pension contribution to sale must be presented on the Internet. − New legislation is to be introduced with re- ter the original deposit was made, and the funds the Danish Labour Market Pension Fund must be withdrawn no later than ten years after (ATP) will be levied on employees, self-em- gard to rental housing. Within the private housing market, landlords must be urged to this date in order to maintain tax exemption on ployed individuals, and unemployment-bene- the accumulated interest. Withdrawal of these fit and cash-benefit claimants. maintain their properties. Tenants must be − consulted on issues regarding maintenance funds requires that documentation be submitted In an effort to reduce private consumption to the relevant bank, proving that they will be which has been financed by means of mort- and improvements. With respect to non- profit rental housing, tenants must have used for one of the purposes outlined in the gages on equity which has been created by above. (No. 808/29 October). the significant increases to property prices, access to submit formal complaints. − stamp duties on additional mortgages are It must be easier to repay student loans and - 23 October Stamp duties increase increased from 1.5 per cent to 5 per cent. in special cases - to have them cancelled. A The Danish Parliament adopts the projected This increase is temporary and expires at the bill provides opportunities for reducing inte- temporary increase in the stamp duty on mort- end of 1998. rest rates on state-guaranteed student loans. gage deeds on permanent residences and holi- − A number of cuts and economies are to be Such reductions are to be effected by means day homes. The Act enters into force on 25 Oc- carried out in an effort to reduce public of refinancing of the relevant debt in the tober 1997 and is effective as of 23 October expenditure by DKK 2 billion in 1998. Mortgage Bank. 1997 and until 31 December 1998. The Act − − Labour-market flexibility and mobility must It should be possible to sign electronic docu- entails an increase from 1.5 per cent to 5 per be increased by requiring that unemployed ments by means of a so-called digital signa- cent. (No. 804/24 October). individuals accept reasonable employment ture. The objective is for this digital signature after a six-month period of unemployment. to be as valid in legal terms as signatures by 27 October The Danish government The concept of "reasonable employment" is hand. sells Tele Danmark shares clarified. At the same time, unemployed indi- The Danish government sells its shares in Tele viduals are required to apply for jobs outside Denmark to the American telecommunications group Ameritech.

b b Political-economic calendar 191

The agreement between Tele Danmark and own sector after only six months of a new action plan on the aquatic environment. Ameritech is expected to entail a complete pri- unemployment. Moreover, the unemployed The overall objective is to reduce nutrient emis- vatisation of Tele Danmark, and to assign full must - in special cases - be prepared to sions and discharges by 37,100 tonnes during a control of Tele Danmark to the American part- commute for up to four hours a day. Cash- five-year period. The following measures are to ner. Ameritech buys 34.4 of the share capital in benefit claimants must be registered with the facilitate this: Tele Denmark from the Danish government for Public Employment Service and be subjected The use of fertilisers within the agricultural approximately DKK 21.1 billion, and when Tele to more thorough assessment as regards sector is to be reduced by 10 per cent, and ma- Danmark buys DKK 10 billion worth of shares labour-market availability. nure from livestock must be utilised more effec- back from the Danish state, Ameritech becomes − User charges are to be abolished within tively. the largest shareholder by far with a holding of labour-market training, and DKK 75 million This autumn sees the beginning of fines directed 42 per cent of all shares. are set aside for training (activation) of un- at farmers who use too much fertiliser. For employed individuals with higher education. excess use of up to 30 kilograms per hectare, 27 October Global unrest at stock exchanges − An additional 1,000 students are to be these fines will be set at DKK 10 per kilogram; The substantial falls in prices seen at Asian admitted to higher education. An additional greater excess usage is punishable by fines of stock exchanges during recent days hits Europe DKK 15 million must be set aside for the Folk DKK 20 per kilogram. in the morning and then moves on to hit the High Schools due to a reduction to student A general tax is to be introduced on fertilisers to USA, where the New York stock exchange takes applicants. Moreover, a new type of the amount of DKK 5 per kilogram. the unprecedented step of suspending all education is established: "alcohology". The Extra funds are to be allocated for establishing dealing for the remainder of the day after sub- objective is to provide a training scheme wet meadows, afforestation projects, and ini- stantial declines to the prices of benchmark sha- within the scope of the so-called Minnesota tiatives with a view to changing agricultural res as a result of the financial crisis in Asia. model for treatment of alcohol abuse, where production methods from traditional farming to 21 November ØK moves to Singapore former alcoholics treat those who are still organic farming. All these initiatives are to As a result of the financial hardships of ØK, the afflicted by the addiction. replace intensively farmed agricultural land, thus − management announces that the company As of 1 April, the paternity-leave period is occasioning a decrease in the discharge of headquarters will be moved from Copenhagen doubled: from two to four weeks. The nutrients. to Singapore at the beginning of 1998 in order additional two weeks are to be taken after After harvesting, farmers must sow additional be closer to the main activities in Asia. the expiry of the mother's maternity leave, crops in order to absorb nutrients (nitrogen). and the total parental leave period is 11 March General Election 21 November EU summit on unemployment extended from 24 weeks to 26 weeks. − The general election results in the following The Heads of State and Government within the Pesticide taxes are doubled in an effort to reduce the use of pesticides, thus securing distribution of seats in the Danish Parliament EU meet at an EU Summit to discuss ways in (for the previous distribution of seats, please see which to combat European unemployment. In drinking-water reserves. Moreover, nutrient discharges from the agricultural sector are to »21 September 1994«): spite of disagreement with regard to specific ob- The Social Democratic Party...... 63 jectives and initiatives to combat unemploy- be reduced by means of lower norms for fertiliser usage and levies on usage which The Social Liberal Party ...... 7 ment, a Job Action Plan is prepared. This action The Conservative Party...... 16 plan includes the following declarations of in- exceeds this tax. − An additional DKK 5 million is set aside for The Centre Democrats...... 8 tent: The Socialist Peoples’ Party...... 13 − Young people must be offered jobs or edu- sale and marketing of environmentally friendly (organic) products. Levies on control The Danish People’s Party...... 13 cation within a six-month period, and the The Christian People’s Party...... 4 long-term unemployed must receive similar of organic farming are also removed. − DKK 250 million are set aside for improve- Venstre (Denmark’s Liberal Party) ...... 42 offers within a twelve-month period. The Progress Party ...... 4 − 20 per cent of all unemployed individuals ments of home help. Senior citizens are to have greater freedom of choice in determi- The Danish Red-Green Alliance...... 5 must be offered vocational training. Total...... 175 − All EU Member States must prepare action ning how the allocated assistance is to be utilised. New regulations are to ensure that An additional four members were elected for plans addressing the unemployment issue. Greenland and the Faroe Islands; two from each These action plans are to be presented at the home help is in actual fact provided, and that compensation is made for any cancel- region. As a result of the general election, the EU Summit in Cardiff in June 1998. The minority government hitherto in power will Member States have a five-year period to lations. − DKK 200 million are set aside over a three- continue with Poul Nyrup Rasmussen as Prime meet these objectives. Minister. year period for improvements to the Copen- 1 December Agreement on the Finance Act hagen-Ringsted railway tracks. Moreover, 16 March Amendments to the EMS The government concludes the negotiations on better and longer trains are to operate in As a result of a decision to carry out adjust- the 1998 Finance Act. The government parties, Jutland, and the S-train network in the Co- ments to currency rates, the Irish punt has been Venstre (Denmark’s Liberal Party), the Conser- penhagen area must be improved and revalued by 3 per cent. The Greek drachma has vative Party, the Socialist Peoples’ Party, the extended. entered the EMS with fluctuation margins of 15 − Centre Democrats, and the independent MP Funds will be set aside in 1998 to an amount per cent each way. This results in the following Jacob Haugaard vote in favour of the overall of DKK 250 million for new premises for the intervention rates for the Irish punt and Greek 1998 Finance Act. The final settlement on the Danish National Archives. These new drachma between Danmarks Nationalbank and Finance Act comprises a number of sub-agree- premises are to be situated in Ørestaden. foreign-exchange dealers: − ments which have been entered into with An additional DKK 100 million are set aside Buying rate: DKK 815.774 per 100 IEP various parties. Among other things, these sub- in 1998 for measures directed against special Buying rate: DKK 1.81948 per 100 GRD agreements include the following elements: crime issues in the larger cities, and an − Asking rate: DKK 1,099.95 per 100 IEP New taxes are introduced on chocolate, ice additional DKK 80 million is allocated to the Asking rate: DKK 2.45331 per 100 GRD cream, coffee, tea, and mineral water. This courts in an effort to reduce waiting times The intervention rates for the other EMS entails the following increases in cost: The within the judicial system. currencies remain unaltered. This adjustment − price of chocolate increases by DKK 1.75 per The depreciation period for goodwill is means that the central rates in relation to the kilogram; ice cream is up by DKK 0.40 per reduced from 10 to 7 years in order to ease ECU are altered for all EMS currencies. The new litre, coffee is up by DKK 1.65 per kilogram, the problems which arise in connection with central rates are as follows: tea by DKK 1.55 per kilogram, and mineral generational handovers of enterprises. Denmark ECU 1 = 7.54257 DKK water rises by DKK 0.25 per litre. Moreover, Germany ECU 1 = 1.97738 DEM packaging taxes are introduced on all France ECU 1 = 6.63186 FRF bottles. This does not, however, apply to 1998 Belgium ECU 1 = 40.7844 BEF bottled dairy products and pharmaceutical The Netherlands ECU 1 = 2.22799 NLG products. 16 February Agreement on − Ireland ECU 1 = 0.796244 IEP Stricter regulations will be introduced with the aquatic environment Spain ECU 1 = 168.220 ESP respect to labour-market availability. Among The government parties, Venstre (Denmark’s Portugal ECU 1 = 202.692 PTE other things, this entails that unemployed Liberal Party), the Conservative Party, and the Austria ECU 1 = 13.9119 ATS individuals must apply for work outside their Socialist Peoples’ Party enter into agreement on

b b 192 Political-economic calendar

Finland ECU 1 = 6.01125 FIM 45 per cent voted in favour of it. The employees’ 17 June The Whitsun Package Italy ECU 1 = 1,957.61 ITL no to the result of the negotiations means that The government enters into an agreement with Greece ECU 1 = 357.000 GRD Denmark faces the first large-scale industrial the Danish Red-Green Alliance and the Socialist While the British pound does not take part in conflict in 13 years from Monday, 27 April. Peoples’ Party on the Whitsun Package. The this monetary system, the theoretical central agreement includes the following elements: rate is: 3 May EU Summit in Brussels The temporary one per cent increase in the Great Britain ECU 1 = 6.653644 GBP The Heads of State and Government of the EU Danish Labour-Market Pension Fund contribu- appoint Wim Duisenberg (from the Netherlands) tion which was introduced in autumn 1997 is 23 March Collective agreement as the first president of the European Central now rendered permanent. At the same time, the within the industrial sector Bank (ECB), which is formed as of 1 January scheme is amended: all employees will receive The Confederation of Danish Industries and the 1999. After strong pressure from France - and in the same disbursement, regardless of the indivi- Central Organisation of Industrial Employees in contravention to the intentions of the Maastricht dual amount deposited. Deposits for the com- Denmark enter into an agreement which entails Treaty, which stipulates an eight-year period of pulsory pension-savings scheme must me made increases in minimum-wage rates: an extra DKK office - a compromise is reached at the EU by all citizens between the ages of 17 and 66. 2 an hour as of 1 March 1998 and 1 March Summit to the effect that Wim Duisenberg will After age of 67, these savings will be paid out in 1999. The agreement also includes the following be replaced after a periods of four years by Jean- instalments over a ten-year period. elements: Claude Trichet from France, who will then be (No. 468/1 July) Nuisance bonuses: nuisance bonuses are president of the ECB for the following four-year The agreement on the Whitsun Package entails increased by 8.5 per cent on 1 March 1999. period. a long series of amendments to personal-income Pensions: Pension contributions increase by 0.9 6 May Government action on the tax regulations. These amendments include an per cent on 1 July 1998 and 1 July 1999. As of increase of the tax ceiling from 58 per cent to 59 the summer of 1999, wage-earning employees labour-market conflict Following the breakdown of negotiations per cent, and a reduction in the bottom tax from will save up a total of 5.7 of their pay as 8 per cent to 5.5 per cent in 2002. This reduction pensions; the corresponding figure for salaried between the Danish Employers’ Confederation and the Danish Confederation of Trade Unions, will occur gradually: a 0.5 per cent reduction in employees will be 4.8 per cent. both 1999 and 2000, and a 0.75 reduction in Working hours: On 4 October 1999, working the government introduces the political action which terminates the trade conflict in Denmark. both 2001 and 2002. The basic personal allo- hours for shift work are reduced from 35 to 34 wance as regards intermediate taxes is increa- hours a week. Moreover, local agreements may The measures taken entail the following conse- quences: sed by DKK 8,000 per year, resulting in an cause weekly working hours to exceed 37 hours, − increase for this tax bracket from DKK 139,000 even though the number of annual working Two extra holidays per year for all employees with more than nine months of employment in 1998 to DKK 171,000 in 2002. The tax rate hours remains at 1924. An extra holiday per for the intermediate tax remains unchanged at 6 year is granted as 24 December is turned into a with their enterprise. For those with full pay during sickness, these holidays are also with per cent. As of 1999, interest expenses are no paid holiday. longer deductible to the intermediate-tax base. Maternity leave: Pay during the 14 week period full pay. − Three care days (two days in 1998 and one From the year 2000, interest expenses can only of maternity leave is increased to DKK 115 an be deducted by 50 per cent in the bottom-tax hour from April 1998. For salaried employees, additional day in 1999) are awarded to em- ployees with children under the age of 14 if base. As of 2001, interest expenses cannot be the maximum monthly pay during maternity deducted from the bottom-tax base at all. A leave is increased to DKK 18,438. these employees have been with their enter- prise for more than 6 months. For employees transitional scheme is established for persons Telework: The labour-market parties have with interest expenses greater than 20 per cent agreed on a framework on teleworking. This who are entitled to full pay on their children's first day of sickness, these care of their personal income. The discount amounts framework will be filled in by means of local to 4 per cent in 2000, 8 per cent in both 2001 agreements. days are also with full pay. − The projected pension contributions are redu- and 2002, 6 per cent in 2003, 4 per cent in 23 March List of ministers ced for employers who have been affected by 2004, and 2 per cent in 2005. This discount Following the recent general election, the Prime the conflict: instead of the 0.9 per cent scheme becomes obsolete in 2006. Tax deduc- Minister presents the new Danish government, planned, they will only have to pay 0.5 per tions such as trade-union membership fees, which comprises 19 ministers: cent. unemployment-insurance fund membership fees, Prime Minister Poul Nyrup Rasmussen − As of 1 January 1999, all employers will be and mileage allowances can no longer be in- Minister for Economic Affairs and Minister for exempt for payment of the new sickness-be- cluded in calculations concerning the lower tax Nordic Cooperation Marianne Jelved nefit contribution of DKK 325 per employee. bracket from the year 2002. As of 1999, Minister for Finance Mogens Lykketoft These agreements enter into force at midnight deposits made in connection with capital- Minister for Foreign Affairs Niels Helveg Petersen between 7 and 8 May and will remain in force pension schemes are no longer deductible in the Minister for Justice Frank Jensen until 1 March 1999. The agreements apply to tax base for the top tax (the top tax rate remains Minister for Taxation Ole Stavad employees and employers who fell within the unaltered at 15 per cent). (No. 423/26 June) Minister for the Environment scope of the conciliators' draft settlement of 31 The gross tax remains unaltered at 8 per cent. and Energy Svend Auken March 1998. Thus, there will be no extra holi- However, the present division of gross-tax funds Minister for the Interior Thorkild Simonsen days and care days for employees who did not into three different funds is abolished. As of Minister for Defence Hans Hækkerup take part in the strike ballot. The government's 1999, an overall labour-market fund replaces Minister for Labour Ove Hygum motion for action was adopted by the Danish the previous unemployment-benefit fund, acti- Minister for Trade and Industry Pia Gjellerup Parliament on 7 May. Most parties voted in fa- vation fund, and sickness-benefit fund. More- Minister for Social Affairs Karen Jespersen vour of this government action with the excep- over, gross-tax funds will now also be used to fi- Minister for Food, Agriculture, tion of the Socialist Peoples’ Party and the nance early-retirement pensions. and Fisheries Henrik Dam Christensen Danish Red-Green Alliance, both of which voted (No. 424/26 June). Minister for Health Carsten Koch against the motion, and the Danish People’s As of the 2002 income year, taxpayers with Minister for Transport Sonja Mikkelsen Party which refrained from voting. incomes of less than DKK 136,100 can deduct Minister for Culture Elsebeth Gerner Nielsen an additional 25 per cent of their mileage allo- Minister for Education Margrethe Vestager 11 May Tele Danmark in major merger wance to a maximum of DKK 6,000. Tax values Minister for Research Jan Trøjborg The main shareholder in Tele Danmark, Ameri- for company cars are increased from 23 per cent Minister for Housing tech, enters into an agreement to merge with to 25 per cent. As of 1999, value limits with and Urban Affairs Jytte Andersen the American telecommunications company SBC regard to company cars are increased from DKK Minister for Development Aid Poul Nielson Communications Inc. 150,000 to DKK 160,000 and from 400,000 to 450,000. (No. 427/26 June). 24 April No to collective agreement 28 May Referendum on the Amsterdam Treaty The rental-value tax on properties and the The result of the collective-bargaining negotia- The referendum on the Amsterdam Treaty re- standard allowances associated with this tax are tions between the Confederation of Danish Indu- sults in a Danish yes to the new EU Treaty. Of repealed as of 2000. The rental-value tax is re- stries and the Central Organisation of Industrial the votes cast, 55.1 per cent were in favour of placed by a municipal property tax, which is Employees in Denmark is refused by employees. this new treaty, while 44.9 were against. based on the public valuation. For properties Within a voting turnout of 47 per cent, 55 per with a value of up to DKK 2.15 million, this tax cent voted against the draft settlement, whereas will amount to 0.1 per cent of the official value -

b b Political-economic calendar 193

present home-owners, however, will only be − The unemployment-benefit period is to be a manner which clearly distinguishes the charged 0.08 per cent. Where the public valua- reduced from five years to four years. During actual sale from the financial terms. tion of a property exceeds DKK 2.15 million, a this period, claimants can receive unem- − A maximum limit on CO2 emissions must be 0.3 per cent tax will be levied on the value in ployment benefit for one year and must take stipulated. This limit must comply with Den- excess of this amount. The present standard part in activation schemes during the remai- mark's obligations under the Kyoto Agree- deductions for current home-owners are repla- ning three years. The special regulations on ment. ced by a 0.4 per cent deduction to the property the 50-54 age bracket are to be repealed, − Driving a diesel car should be made more tax; this deduction cannot, however, exceed thus bringing regulations on this group in expensive. This will be done to prevent DKK 1,200. OAPs over the age of 67 qualify for line with those applying to the rest of the people from replacing petrol-fuelled cars a 0.4 per cent reduction in the calculated pro- population. This means that this age group with diesel cars when petrol taxes increase perty tax. This reduction cannot, however, ex- will also be subject to the right and obliga- in accordance with the Whitsun Package. ceed DKK 6,000 for permanent residences and tion to participate in training and activation DKK 2,000 for holiday homes. From 2000, all with a view to securing permanent employ- 25 November Agreement on the Finance Act participants in any type of retirement-benefit ment. Activation is to be increasingly direc- The government concludes negotiations on the scheme who are over the age of 60 will be ted at specific jobs or specific enterprises, 1999 Finance Act. The government parties, Ven- protected by a regulation which stipulates that and employers will have greater responsi- stre (Denmark’s Liberal Party), the Conservative this property tax cannot increase by more than bility and obligations with regard to taking Party, the Centre Democrats, and the Christian DKK 500 per year. (No. 425 and 426/26 June). in unemployed individuals as part of voca- People’s Party vote in favour of the overall 1999 As of 1 January 1999, the present tax levied on tional-training schemes and to hiring adult Finance Act. The Finance Act comprises a series the real rate of interest is replaced by a set capi- trainees. of reforms within areas such as early retirement, tal-income tax of 26 per cent. (No. 430/26 June). − Regulations are to be tightened as regards pensions, the labour market, and housing As part of the Whitsun Package, the Danish sickness during unemployment. For exam- benefits. In an effort to ensure slower and more Parliament adopts a series of tax increases: The ple, more rigorous assessment with respect gradual withdrawals from the labour market, a new green taxes will be introduced during 1998 to labour-market availability will be carried new withdrawal system is introduced as of 1 - 2002: out when unemployed individuals have cal- July 1999. These amendments will not affect The petrol tax is increased by DKK 0.50 per litre led in sick twice during public-employment those who have turned 60 before 1 July 1999. (incl. VAT) on 1 January 1999. On 1 January measures or activation. The retirement age is reduced to 65 years. 2000, it is increased by another DKK 0.125 per − Unemployment benefits are to be calculated A special early-retirement subscription fee is litre (incl. VAT), a process which is to be repea- in a new way: current regulations stipulate introduced. All individuals must pay this fee for ted on 1 January 2001 and 1 January 2002. that unemployment benefits be calculated a period of 25 years in order to qualify for early However, all tax increases beyond 1999 will on the basis of the income of the last 12 retirement benefit. require corresponding tax increases in Germany. weeks; in future, the total annual income As of 1999, unemployment-insurance fund con- The cost of heating fuel oil will increase by DKK will be used instead. These new regulations tributions will comprise two parts: one contri- 0.21 per litre on 1 July 1998, and by a further will not enter into force until 2001 after bution which entails a right to receive unem- DKK 0.03 on 1 January 2002. consultation with labour-market parties. ployment benefits in the event of unemploy- The cost of electric heating will increase by DKK − Early retirement is to be guaranteed for all ment, and another which entails a right to early- 0.015 per kWh on four separate occasions: 1 citizens over the age 60. retirement benefits. Employees must pay the January 1999, 2000, 2001, and 2002, respec- − Housing benefits are to be reduced, espe- special early-retirement contribution for a full 25 tively. cially as regards affluent OAPs. A lower years if they wish to subscribe to the early- The cost of electricity used for purposes other threshold is also to be introduced with retirement scheme. than heating will increase by DKK 0.06 per kWh regard to housing benefits, so that all indivi- Those who take early retirement at the age of to DKK 0.52 per kWh. However, this increase duals must pay a minimum of DKK 883 per 60 will only receive 91 per cent of the maximum will be supplemented by an increase of DKK month (DKK 10,000 per year) of their rent. unemployment-benefit rate during the entire 0.015 per kWh on 1 January 1999, 2000, 2001, − Company taxes are to be reduced from 34 early-retirement period, and all types of pension and 2002, respectively. per cent to 32 per cent. payments will be deducted from this rate, even The cost of natural gas increases from DKK 1.64 − The child-care leave scheme must be more if they are not paid out. However, employees per m3 to DKK 2.02 per m3. (No. 437/26 June). flexible; this entails a relaxation of the re- who elect to continue to work until the age of quirement stipulating that scheme parti- 62 will receive full unemployment benefit during 25 August Finance Act Proposal (Budget) cipant must take at least 13 weeks leave. the entire early-retirement period, and any The Minister of Finance introduces Bill No. 120 − It must be made easier for parents to have pension payments will not be deducted from this of 25 August: the 1997 Finance Act. benefit. their children cared for within the private sector. Local authorities will be authorised Individuals who are entitled to receive early- 4 September Abattoir merger retirement benefits, and who continue work for The two largest abattoirs/meat-product manu- to increase subsidies for parents who elect options other than local-authority day-care a period of up to two years after attaining the facturers in Denmark, Danish Crown and Vest- right to take early retirement, become entitled to jyske Slagterier, announce a merger of the two centres and kindergartens. − tax reductions at the official retirement age to enterprises. Single parents should be helped more. Single parents who cannot accept a job the amount of DKK 33,600 per year. 1 October Sharp drops in share prices because their local authority cannot provide A single-rate early-retirement benefit of approxi- Negative news on the financial crisis in Japan day care for their children should no longer mately DKK 68 an hour is introduced. wreaks further havoc with global finances. Stock be forced to live on less than the normal The unemployment-benefit period is reduced markets in the USA and Europe see sharp drops cash-benefit rate. The current situation for- from five to four years. All young people under in share prices, occasioning a global surge of ces these parents to take child-care leave, the age of 25 become subject to the right and interest in less risky bonds. which entails a low income of 60 per cent of duty to participate in activation after six months the maximum unemployment-benefit rate. of unemployment. This represents an amend- 6 October The government's policy statement Legislative amendments will entitle single ment of current regulations, which only stipulate The Danish Parliament is back in session and is parents to an additional benefit, which will early activation for young people with no quali- opened by the Prime Minister's opening speech, bring their total income in line with normal fications. which includes the following policy statements: The oldest groups within the labour market must − cash-benefit rates for parents. All individuals affected by long-term unem- − Buying and selling property should be sim- also be activated. This means that unemployed ployment must receive a job offer or an offer pler and cheaper. At the same time, amend- individuals in the 50-55 age bracket now also of training/education no later than after the ments must be carried out within significant become subject to the right and duty to first twelve months of unemployment. All areas of real-estate agent operations. Estate participate in activation. young people under the age of 25 must agents will fall under an obligation to The special regulation on extended unemploy- receive such an offer after a maximum peri- establish a joint search system by means of ment-benefit periods for the 50-59 year-olds is od of six months of unemployment. At least a public media. In practical terms, this reduced in scope: it now applies only to the 55- 75 per cent of the subsequent unemploy- means that all properties will be put up for 59 year-olds. Those falling within the scope of ment period must be used for activation. sale in a common register on the Internet. In this special regulation will now also be subject future, contracts of sale must be prepared in to the right and duty to participate in activation.

b b 194 Political-economic calendar

Housing benefits for OAPs are restructured in a Deutschmark within the EMS (DKK 381.443 per ployees with more than six months of em- manner which ensures that pensioners with DEM 100) and the exchange rate between ployment within the state sector. The additional annual incomes of DKK 110,000 or less cannot Deutschmark and Euro: days can also be paid out. State employees, like lose more than DKK 500 a year as a result of Central rate: DKK 746.038 per EUR 100 the local-government employees, must prepare this restructuring. The fluctuation margin for the Danish krone has to be more flexible as regards working hours, as The extraordinary increase to the stamp duty on been set at 2.25 per cent each way, and the exact working hours will be determined locally. supplementary mortgages on property from 1.5 intervention rates are: Emphasis is placed on skill-raising schemes; per cent to 5.0 per cent is maintained until 1 Buying rate: DKK 762.824 per 100 EUR these include the formation (on 1 April 2000) of December 1999. Asking rate: DKK 729.252 per 100 EUR a special state Centre for Competencies and In an effort to reduce activity within the building Quality Development. sector, a DKK 5 billion ceiling is imposed with The irrevocably set exchange rates between the respect to construction works within non-profit Euro and the national currencies of those EU 10 March Dairy merger rental housing; this corresponds to a maximum Member States who accede to the Euro on 1 The two largest dairy companies in Denmark, limit of 6,000 new dwellings in 1999. The num- January 1999 are as follows: MD Foods and Kløver Mælk, announce their ber of co-operative flats is also reduced from EUR 1 = 40.3399 Belgian franc plans to merge. = 1.95583 German Deutschmark 1,000 to 750. 10 March Merger in the financial sector Company-tax rates are reduced from 36 per cent = 166.386 Spanish peseta = 6.55957 French franc Unibank announces their acquisition of the Tryg- to 32 per cent in 1999, and work is being carried Baltica insurance company. out to ensure a further reduction (to 30 per cent) = 0.787564 Irish punt in the year 2000. = 1 936.27 Italian lire 24 March NATO action against Yugoslavia The gross tax on employers - the labour-market = 40.3399 Luxembourg franc NATO initiates aerial attacks on military targets contribution - is repealed as of 2000. A large = 2.20371 Dutch guilder in Yugoslavia with a view to putting an end to number of regulatory amendments facilitate ea- = 13.7603 Austrian schilling Serbian aggression against the Kosovo-Albanian sier administration for small enterprises. = 200.482 Portuguese escudos population. A waiting-list guarantee is introduced with = 5.94573 Finnish markka 10 June Election for the European Parliament regard to potentially fatal diseases. This guaran- 25 February Local-authority collective agreement tee is aimed specifically at heart disease and The election for the European Parliament results Local government employees, as represented by in the following distribution of votes (per cent) breast cancer, lung cancer, and intestinal cancer. KTO (The Association of Local Government If the county of residence proves unable to The Social Democratic Party...... 16.5 Employees' Organisations), agree on a settle- The Social Liberal Party ...... 9.1 provide treatment at a public hospital, a private ment with local-authority employers. This hospital, or at foreign health-care facilities, this The Conservative Party, ...... 8.5 agreement provides three additional days of The Centre Democrats...... 3.5 task falls upon the National Board of Health. In holidays for local-authority employees; one of the event that the Board of Health should also The Socialist Peoples’ Party...... 7.1 these extra days will be awarded during each of The JuneMovement...... 16.1 fail to secure treatment, patients are entitled to the three years of the agreement period. seek treatment in Denmark or abroad at the The People’s Movement against the EU...... 7.3 Employees may choose to take a cash payment The Danish People’s Party...... 5.8 expense of their county of residence. in lieu of these holidays. The agreement entails The subsidy system for medication is restruc- The Christian People’s Party...... 2.0 total pay rises of 7.55 per cent during the next Venstre (Denmark’s Liberal Party)...... 23.4 tured so that greater expenses entail greater three years. However, the general pay rises public subsidies. Medication costs of less than The Progress Party ...... 0.7 comprised within this overall framework will Total ...... 100.0 DKK 500 do not qualify for subsidies. only be 5.46 per cent. The remaining funds will The early-retirement system is to be reformed, This results in the following distribution of be distributed as follows: 0.97 per cent are candidates: 5 candidates for Venstre (Denmark’s so that local authorities fall under an obligation allocated to special pay pools, 1 per cent will be to monitor and control vocational training and Liberal Party) , 3 candidates each for the Social used to finance the extra holiday, and 0.19 per Democratic Party and The JuneMovement, and 1 rehabilitation of clients at private enterprises. cent will be used for pensions. These pay rises The state share of the cost of early retirement is candidate each for the Social Liberal Party, the do not include the effect of the adjustment Conservative Party, the Socialist Peoples’ Party, reduced. Sickness-benefit regulations are amen- scheme, which prevents the difference between ded in order to impose greater costs on local the People's Movement against the EU, and the pay within the public and private sectors from Danish People’s Party. authorities, thus inducing local authorities to becoming too large. This adjustment scheme promote rehabilitation with a view to reducing will entail a 0.70 per cent pay rise in the first 10 June Peace plan for Kosovo sickness-benefit costs. year of this agreement period. Employers will The UN Security Council adopts a peace plan for

have more flexibility to dictate employees’ Kosovo. This peace plan means that the peace working hours. It becomes possible carry out force is able to start moving in, while the 1999 local/regional departures from central regula- Yugoslavian force begins their withdrawal. tions on working hours, and reimbursements for 1 January Single EU currency is introduced overtime can take the form of cash payments 10 July New ministers EU enters the third stage of the Economic and rather than time off. Employees aged 21 or more The present Minister for Research, Jan Trøjborg, Monetary Union, and 11 EU Member States (Fin- who have already been in permanent employ- takes over the Ministry of Development Aid from land, Germany, Luxembourg, the Netherlands, ment for at least one year will have access to Poul Nielson, whereas Birte Weiss is appointed Belgium, Ireland, Austria, France, Spain, Portu- labour-market pension schemes. Previously, this as the new Minister for Research. gal, and Italy) officially abolish their currencies requirement involved a minimum age of 25 31 August Finance Act Proposal (Budget) and enter into collaboration on a single cur- years and four years of employment. Employers' rency, the Euro. The Minister of Finance introduces Bill No. 249 right to fire employees with more than 120 days of 31 August: the 2000 Finance Act. 1 January Central rates and fluctuation of absence due to sickness within a one-year margins for the Danish krone in ERM II period is repealed. 5 October The government's policy statement The Danish Parliament is back in session and is As of 1 January 1999, the Danish krone accedes 26 February Collective agreement to the new EU currency mechanism, ERM II. opened by the Prime Minister's opening speech, for state employees which includes the following policy statements: Following the adoption of set rates of exchange The state employees, as represented by the Joint − with regard to the Euro and the national curren- The use of PVC and phthalates is to be Committee of the Central Organisations, agree reduced by means of new taxes. cies hitherto in force for those countries which on a settlement with the Danish Minister of − introduce the Euro on 1 January 1999, Denmark, Pesticide use in agriculture, forestry, and Finance. This agreement is largely similar to the private gardens must be reduced. Greece, the Euro countries and the European agreement entered into by local-government − Central Bank, the ECB, have stipulated central New regulations are to be introduced on employees. This agreement entails a 7.5 per registration of sales and use of feedstuffs rates for the Danish krone and the Greek cent pay rise and a continuation of the pay- drachma in relation to the Euro. The central rate and additives at individual farms. It is also adjustment scheme. State employees will re- proposed to provide legal opportunities for for the Danish krone in relation to the Euro has ceive an additional three days of holidays during been calculated on the basis of the central rate holding back shipments of feedstuffs where the next three years. The first additional day these feedstuffs are suspected to contain hitherto in force in relation to the German becomes available on 1 April 1999 for all em-

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undesirable substances or dangerous bac- to this cooperation scheme on 1 October − Police agreement (participants: the Social teria. 2000. Democratic Party, the Social Liberal Party, − A proposal is advanced for the repeal of the − The first step with regard to a reform of the Socialist Peoples’ Party, the Centre regulations on reimbursement of enterprise legislation on gambling will be taken this Democrats, Venstre (Denmark’s Liberal Par- costs in connection with the administration year. This reform will include issues such as ty), the Conservative Party): This four-year of taxes and costs. taxes on gambling, and the first area to be agreement allocates extra funding to the − Less rigorous and more uniform taxation addressed will be slot machines. police to a total amount of nearly DKK 2.4 should be levied on employers’ contribu- − The legislation on competition is to include billion. An additional 540 positions will be tions for training/education and transport in the issue of mergers, thus improving state filled, of which 230 will be police officers. relation to this. Among other things, this control in connection with major mergers. Agreements have been entered into on proposal is to enable enterprises to help − An amendment to the Penal Code is to improvements in local police work, stronger redundant employees with re-training pro- facilitate more frequent use of community efforts directed against violent crime and grammes without subjecting such emplo- service as punishment for drink driving. gangs, and more patrol work. Part of the yees to additional taxes due to such sche- − Camera surveillance of traffic is to be funding is to be spent on border control in mes. authorised. connection with the Schengen agreement − A reform of the adult-education and sup- and on improvements to police IT and plementary-training system is planned. This 5 October Danish/Swedish dairy merger emergency exchanges. A number of fines system is to aim more specifically at those MD Foods and the Swedish Arla announce their are increased in order to supply police with short-term education and at educa- plans to merge, thus creating the largest dairy funding. Additional funding is secured by tion/training which provides real labour- company in Europe, which will be called Arla cuts to funeral activities and by abolishing Foods. market competencies. The objectives of va- the postage subsidies previously in force for rious types of general education should also 16 November Tax and duty amendments journals. − be clarified. As of 26 October 1999, the Danish Parliament Agreement on service jobs (participants: the − A two-year pilot project is to provide local- adopts higher taxes on used, imported vans. A Social Democratic Party, the Social Liberal authorities with opportunities for taking on graded scale is introduced, with tax brackets Party, the Centre Democrats, the Socialist mature long-term unemployed individuals in being adjusted in accordance with the age of Peoples’ Party, the Danish Red-Green Allian- permanent positions on standard terms. The the vans, just as for used passenger cars. The ce): A two-year pilot scheme on service jobs proposal regarding these so-called “senior taxable value is increased by DKK 6,100 for used is established with a view to enabling local jobs” is an extension of the June govern- cars which are registered for the first time in authorities, counties, and state institutions ment agreement with local authorities. Denmark and which do not feature a catalytic to employ mature (48+) unemployed indivi- − Those with flex jobs should have improved converter or a similar device. Moreover, the duals in real jobs. This pilot scheme provides rights. taxable value is increased by DKK 7,450 for used unemployed individuals over the age of 48 − A proposal is advanced for an amendment passenger cars and vans which have no airbags, who have taken part in an activation to the legislation on leave, so that families and by DKK 3,725 for vehicles with just one scheme for at least six months with op- with young children have more flexible airbag. This Act applies to vehicles which are portunities for securing a real job within e.g. access to leave. reported for taxation as of 26 October 1999; health care or the traffic sector. Such jobs − Local authorities with guarantee schemes as certain modifications do, however, apply. (No. can entail assistance to qualified health-care regards child care will have the option of 837/17 November) providers, surveillance of train stations, etc. increasing parent contributions by 1 per cent The Danish state provides an annual subsidy a year; however, the 2002 rate cannot 30 November Agreement on the Finance Act of DKK 100,000 to the relevant county or exceed 33 per cent. The government concludes the negotiations on local authority for the duration of employ- − The projected amendments to the regula- the 2000 Finance Act. This agreement comprises ment. The target group comprises 36,000 tions on the home-service scheme will be many sub-agreements featuring agreements unemployed individuals and 25,000 transi- presented in October. A majority within the with several different constellations of parties. tional-benefit claimants. Danish Parliament have already agreed that The following agreements have been entered − Reform of the adult education/supplemen- in future, no subsidies will be available for into: A five-year traffic agreement, a four-year tary training system (participants: the Social window cleaning, and that subsidies for police agreement, an agreement on service jobs, Democratic Party, the Social Liberal Party, gardening work should be reduced. a reform of the adult-education and supplemen- the Socialist Peoples’ Party, the Centre De- − A proposal is advanced for allowing the tary-training system, an agreement on early reti- mocrats): State contributions to adult educa- construction of a new type of cooperative rement, a health-care agreement, and a series of tion and supplementary training are frozen housing, where the only element of public smaller agreements. The various agreements at DKK 3.5 billion. After a few years, the participation will be a municipal guarantee and settlements include the following elements: labour market must finance courses which on the low-priority loans. This proposal will − Traffic agreement: (participants: the Social are specifically aimed at enterprises by make it easier for the elderly – especially Democratic Party, the Social Liberal Party, means of contributions to the newly esta- the affluent group – to form collective co- the Socialist Peoples’ Party, the Danish Red- blished Arbejdsmarkedets Uddannelses- operative housing communities. This will Green Alliance): An annual DKK 1.1 billion is finansiering ('Labour Market Education not affect the present quota of cooperative to be allocated to collective transport during Fund'), also known as AUF. The scope of housing with public support. the next five years. The Danish National these contributions is determined by the − An EU Directive stipulates that a ban on Railway are to use this money for new high- board of management of the AUF, which adverts on tobacco be introduced. This ban speed trains for the services between comprises the labour-market parties. Calcu- will comprise all types of advertising, spon- Copenhagen, Aarhus, and Aalborg, and to lations issued by the Ministry of Labour sorships, and free distribution of tobacco. improve S-train connections between Co- show that a total boost of DKK 200 million − All public institutions, including day-care penhagen Central Station and Østerport will entail contributions of DKK 100 per full- institutions, schools, and hospitals, are to Station. A series of projects are also brought time employee. Public efforts are to aim introduce no-smoking environments. Tea- forward, especially in the Copenhagen area. specifically at providing boosts for those chers may still smoke; all smoking must, Annual funds of DKK 530 million will be with short-term education. The plethora of however, take place in designated areas. allocated to the Danish National Railways courses offered is subjected to rigorous This also applies to employees at day-care Agency for improvements to railway tracks. scrutiny, whereas education-benefit rates institutions. Hospital employees will be ban- This is to be financed by means of taxes remain at 100 per cent of the maximum ned from smoking at all on hospital premi- levied on diesel and natural gas, to an unemployment-benefit rate. ses. However, this ban does not enter into amount of approximately DKK 500 million − Agreement on early retirement (participants: force until a transitional period has elapsed. per year, and by converting the Port of Co- the Social Democratic Party, the Social Patients and their families will not be penhagen to a state port. Diesel taxes Liberal Party, Venstre (Denmark’s Liberal affected by this ban. increase by DKK 0.23 per litre, and a new Party), the Conservative Party, the Centre − The Aliens’ Act is to be amended with a tax on natural gas is introduced. This tax Democrats, the Christian People’s Party, the view to compliance with the Schengen will mainly be levied against natural-gas Socialist Peoples’ Party): A framework agreement. Denmark is expected to accede companies. agreement on a reform of the early-retire- ment system is entered into. This reform is

b b 196 Political-economic calendar

expected to enter into force in 2003. This developing countries have no place in the small − Maternity leave: On 1 May, full pay during reform changes the current four types of inner circle of countries which set the agenda for the first 14 weeks of maternity leave is benefit to just two. Those who cannot work WTO negotiations on free trade. amended to a maximum rate of DKK 120 an at all will receive benefit, while those who hour. From 1 May 2003, this is amended to retain some capacity for work will receive a 9 December Tryg-Baltica buys a full pay for 14 weeks. lower benefit. Such benefit claimants will, Norwegian insurance company − Sickness: The period of full pay during however, also become entitled to suitable The Unidanmark Group expands in accordance sickness is increased to five weeks as of 1 employment, thus providing them with op- with its Nordic strategies by acquiring the Nor- July 2000. portunities for augmenting this benefit if wegian insurance company Vesta, thus creating they so desire. of the largest insurance groups in the Nordic 23 February New ministers − Labour-market reform (participants: the So- countries. The Danish Prime Minister, Poul Nyrup Rasmus- sen, announces a government reshuffle. The cial Democratic Party, the Social Liberal 11 December EU Summit in Helsinki Party, Venstre (Denmark’s Liberal Party), the Minister for the Interior, Thorkild Simonsen, and The Heads of State and Government of the EU the Minister for Health, Carsten Koch, step down Conservative Party, the Christian People’s decide to expand the number of countries who Party, the Centre Democrats): This agree- as ministers. Ritt Bjerregaard and Jacob Buksti wish to become members of the EU. Six new are appointed as Minister for Food, Agriculture, ment is an adjustment of the latest labour- countries are invited to enter into negotiations market reform. The most significant amend- and Fisheries and Minister for Transport, on membership: Bulgaria, Latvia, Lithuania, respectively, while the current Minister for Social ment entails less rigorous requirements as Malta, Slovakia, and Rumania. At the same regards activation of unemployed indivi- Affairs, Karen Jespersen, is appointed as the time, Turkey’s application for membership is new Minister for the Interior, the current Mini- duals aged 58-59 who are entitled to early approved by the EU. The Heads of State and retirement at the age of 60. In future, this ster for Food, Agriculture, and Fisheries, Henrik Government decide that the EU must be ready Dam Kristensen, is appointed as the new Mini- group of unemployed people will not auto- to accept new members as of 1 January 2003. matically be forced to take part in activation ster for Social Affairs, and the current Minister schemes. Each case will be assessed indi- 20 December Danisco Distillers sold for Transport, Sonja Mikkelsen, assumes the po- vidually. The unemployed’s opportunities for The state-owned Swedish company Vin & Sprit sition as Minister for Health. Following these gaining a foothold within the labour market announce their acquisition of 51 per cent of the changes, the Danish government comprises the must be improved by using trainee periods company Danisco Distillers, thus taking over following ministers: at enterprises as a tool in activation efforts. classic Danish brand names such as "Aalborg Prime Minister: Poul Nyrup Rasmussen (S) − Health-care agreement: the Social Demo- Akvavit" and "Gammel Dansk". The sale of Da- Minister for Economic Affairs And Minister for cratic Party, the Social Liberal Party, the nisco Distillers heralds a return for "De Danske Nordic Cooperation: Marianne Jelved (R) Socialist Peoples’ Party, the Centre Demo- Spritfabrikker", as Vin & Sprit restores the com- Minister for Finance: Mogens Lykketoft (S) crats, the Conservative Party, Venstre (Den- pany's original name as part of the transaction. Minister for Foreign Affairs: Niels Helveg Petersen (R) mark’s Liberal Party): DKK 495 million are set aside for increased efforts to combat Minister for Justice: Frank Jensen (S) Minister for Taxation: Ole Stavad (S) cancer during the period 2000-2002. The 2000 funds are to be used to buy equipment Minister for the Environment (scanners) and to train specialist health-care 10 January Media merger and Energy: Svend Auken (S) staff. These funds do not include the DKK A merger between the news and entertainment Minister for the Interior: Karen Jespersen (S) 850 million for cancer treatment which form group Time Warner and the largest international Minister for Defence: Hans Hækkerup (S) part of the agreement on county finances Internet supplier American Online creates the Minister for Labour: Ove Hygum (S) for 2000. Opportunities for choosing hospice largest media company in the world. This fusion Minister for Trade and Industry: Pia Gjellerup (S) care are improved, and the psychiatric will set entirely new standards with regard to Minister for Social sector will receive an additional DKK 750 the ways in which the media and entertainment Affairs: Henrik Dam Kristensen (S) million during the period 2000-2002. The industries will distribute their products to Minister for Food, Agriculture, funding for this health-care agreement is to consumers. Time Warner is behind enterprises and Fisheries: Ritt Bjerregaard (S) be raised by means of cuts to state subsidies such as CNN, Warner Music Group, and Fortune, Minister for Health: Sonja Mikkelsen (S) for medication. Tenders are to be invited whereas American Online operates businesses Minister for Transport: Jacob Buksti (S) with respect to a number of pharmaceuti- such as Netscape and CompuServe. Minister for Culture: Elsebeth Gerner Nielsen (R)

cals. Also, public subsidies for new pharma- Minister for Education 22 January Collective agreement and Ecclesiastical Affairs: Margrethe Vestager (R) ceuticals may in future be calculated on the within the industrial sector basis of European average prices. Minister for Research: Birte Weiss (S) − The Confederation of Danish Industries and the Minister for Housing Various agreements (participants: the Social Central Organisation of Industrial Employees in Democratic Party, the Social Liberal Party, and Urban Affairs: Jytte Andersen (S) Denmark enter into a collective agreement Minister for Development Aid: Jan Trøjborg (S) the Socialist Peoples’ Party, the Centre De- which extends to the next four years. This mocrats): The home-service scheme is exten- agreement entails an annual DKK 2 increase in 28 February BSE in Denmark ded in scope, so that it is also possible to the minimum wage to DKK 82.40 on March After the discovery of a single dairy cow infected receive subsidies for services such as grocery 2000, rising to DKK 84.40 and DKK 86.40 during with BSE (mad-cow disease) at a Danish farm, shopping and collection of children from the following two years. New negotiations are the Minister for Food, Agriculture, and Fisheries day-care institutions. In future, payment of scheduled for 2003. The four-year agreement demands that a series of beef products be social pensions will terminate on the date of also includes the following key elements: removed from Danish shops in order to protect the recipient’s death. Such pensions are − Holiday: Four additional holidays next year consumers and secure Denmark’s export of beef. currently paid out to the estate for the rest and an additional five so-called “feriefri- 6 March Unidanmark in major merger of the month in question. The double dage” from 2003. These “feriefridage” are Unidanmark and the Finnish-Swedish Merita personal allowance for bereaved spouses is holidays which must be taken individually Nordbanken announce their merger. also abolished. Fees for new passports are and upon agreement between employers increased to DKK 600. The price of passports and employees. 9 March Euro referendum for children remains unaltered. Taxes in − Pensions: On 1 July 2000, pension contri- connection with legal action are increased The Prime Minister, Poul Nyrup Rasmussen, butions increase to 6.3 per cent, followed by announces that a referendum on Danish acces- from one to two per cent of amounts in increases during the next three years which excess of DKK 6,000. sion to the Euro will be held on Thursday, 28 entail the following total rates: 6.6 per cent, September. This date will not be absolutely set 4 December WTO Summit in Seattle 7.8 per cent, and 9.0 per cent. until the Social Democratic Party votes in favour The WTO negotiations end in a breakdown − Nuisance bonuses: nuisance bonuses apply hereof on 30 April. which is largely ascribed to the large contrasts to work between the hours of 6 p.m. and 6 between the USA, EU, and the developing a.m. These bonuses are increased by 5 per 23 March Amendment to mileage allowances countries. The developing countries are dissatis- cent in 2000 and by a further 2 per cent in Due to the increased cost of petrol, mileage- fied by the way in which the USA and EU force 2002. Negations will resume in 2003. allowance rates for commuters are increased. through their proposals, and by the fact that

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Thus, the following rates are in force as of 20 28 September No to the euro − Denmark’s accession to the Schengen Coope- March 2000: Danish voters say “No” to Danish participation ration must be followed up by various bills, 0-24 kilometres: no allowance in the third phase of the European Monetary including one on Danish accession to the 25-100 kilometres: DKK 1.54 per km Union, concerning the euro – the single curren- common European fingerprint system Euro- More than 100 kilometres: DKK 0.77 per km cy. dac. YES votes: 1,621,937 (46.9 per cent) − The Minister for Education once again ad- 24 March EU Summit in Lisbon NO votes: 1,838,026 (53.1 per cent) vances her proposal regarding the educa- At the Lisbon Summit, the Heads of State and Voter turnout: 87.5 per cent. tional environments of pupils and students. Government of the EU adopt a welfare plan for − As regards the environment, a new bottle de- the 15 Member States. The EU plan is aimed at 2 October Bank merger posit and return system is to be introduced, central aspects of welfare, including pension Danske Bank and RealDanmark, the parent com- allotment gardens must be secured, and systems, taxation, social policies, and education. pany of BG Bank, announce that the two com- more taxes are to be introduced in order to The key elements of this welfare programme are panies merge to form a single group. The areas minimise packaging consumption. listed below: − of activity of this new group comprise retail The Kyoto Protocol on limitations on green- Employment rates must be increased to banking (standard banking), mortgage-credit house gases must be ratified. approximately 70 per cent of the total banking, life insurance, pensions, and in- The environmental efforts made by individual population in 2010; the current employment vestment associations. The group itself is enterprises must be strengthened by means rate is 61 per cent. Governments are urged entitled Danske Bank and is henceforth one of of stricter requirements on green enterprise to set national targets and objectives with the largest banks in the Nordic countries, with a accounts. regard to unemployment. − − total balance sheet of DKK 13,000 billion and an A reduction in the corporate tax from 32 per Employment rates for women must be equity capital of DKK 58 billion. cent to 30 per cent is proposed. It must be increased from the current 51 per cent to easier to resolve tax issues in connection more than 60 per cent in 2010. Better child- 3 October Government programme with generational change within enterprises. care opportunities are to facilitate this. − The Danish Parliament – Folketinget – is back in Enterprises must have the opportunity to The number of young people (18-24) with session. The Prime Minister’s opening speech write off expenditure on purchases of art. no more than ten years of school must be includes the following declarations of intent: If voluntary agreements are not entered into, halved. − − Urban renewal must be improved by means the Danish government will make a proposal Steps must be taken to ensure that all of amendments to the regulations on for the introduction of taxes on the following schools have Internet access. − financing, ensuring that more private funds environmentally harmful substances: MTBE, The development of European pension sy- are involved in such renewal. Also, greater ETBE, and TAME. These substances are typi- stems until 2020 must be analysed. − emphasis must be placed on basic renewal. cally found in petrol. Increased efforts must be directed against − Research must be strengthened, e.g. by The road is paved for write-offs on industrial social exclusion, with particular focus on training more PhD students, and the inter- greenhouse gases such as chlorocarbons and housing, education/training, and health is- play between research conducted within the halons. sues. − private and public sectors must be improved Amendments are proposed to the regulations Public services must be available electroni- with a view to benefiting Danish businesses on the “home PC schemes”, which allow en- cally in 2003. − and commercial interests. The Technical Uni- terprises to buy computers on behalf of their The telecommunications sector must be fully versity of Denmark is to be a private foun- employees. liberalised in 2001, thus ensuring cheaper dation. Simplified taxation of income from stocks. Internet access. − − Danish public administration goes digital. Aerial security must be improved by making 19 May Trade agreement with China Danish citizens and enterprises must have it easier for pilots and air-traffic controllers The EU and China enter into an agreement on the opportunity to communicate with public to report minor errors. − the conditions for China’s accession to the authorities 24 hours a day, and to utilise A bill will be presented with a view to pre- World Trade Organisation, WTO. The last major electronic self-service to a much wider extent venting relations from being able to oppose obstacle is overcome as the framework with than has hitherto been the case. the desire of a deceased person to be an − regard to China’s accession to the WTO is In future, the agricultural sector must pay organ donor when such a desire has been determined. The final admission to the WTO will fees for the processing of applications sub- stated in writing. probably take place during 2000. mitted to various EU subsidy schemes. Efforts Massive effort must be made to prevent regarding nutrition and health must be children and young people from taking up 31 May Carlsberg merger improved, and research on food must be pro- smoking. Day-care institutions and schools Carlsberg and the Norwegian brewery Orkla moted. must be non-smoking environments as re- announce that they will pool their brewery − The Danish Government and Greenland’s gards all areas to which children have activities in a new, jointly owned company Home Rule Government are to renegotiate a access. entitled Carlsberg Breweries. To Carlsberg, this new agreement on subsidies for the Home Alcohol consumption must be reduced, merger with Orkla means that the company Rule. particularly amongst the young. The health target - being among the five largest breweries − Submitting information on employee wages sector is to provide more advice and guidan- in the world - is within much closer range. and salaries must be made easier for Danish ce on a healthy lifestyle. enterprises. This is to be effected through the The Danish government has assigned priority 19 June Merger between ISS introduction of a new "Letlønsystem" to activities within the cancer area. In the and Jydsk Rengøring (“Easy-Pay System”), which means that noti- years to come, resources will also be allo- ISS, Denmark’s largest cleaning company, an- fication need only be submitted to a single cated for significant increases in the capacity nounces its purchase of Jydsk Rengøring. authority, that the information submitted for cancer treatment, specifically in the form need not be as detailed as earlier, and that of more scanners and radiation equipment. 29 August Budget notification need not be carried out as fre- − The Danish government wishes to ensure The Minister for Finance presents Bill No. 293 of quently. that financially challenged pensioners receive 29 August, detailing the proposed Budget for − The process of registering designs must be better, more uniform treatment throughout the fiscal year 2001. made cheaper and easier, and regulations the entire country. Personal supplementary within this area must be harmonised to bring subsidies must be consistently awarded in 12 September Sanctions against Austria lifted them in line with general EU regulations. accordance with individual need, regardless The 14 EU Member States lift their sanctions − Denmark must adopt legislation which ef- of the relevant pensioner’s exact location against Austria. These sanctions were intro- fects Denmark’s accession to the establish- within Denmark. Also to be addressed is the duced on 4 February 2000 as a response to the ment of a permanent international criminal issue of whether the regulations on heating new right-wing government of Austria, com- court. subsidies provide adequate compensation for prising the conservative party ÖVP and the − The objective of the Danish defence must be the increasing energy prices. extreme right-wing party FPÖ, headed by Jörg amended to place greater emphasis on − The Danish government will increase the Haider. international commitments, and professional efforts made to secure greater employment, members of the Home Guard should be primarily by ensuring that the labour market assigned to international duty. can accommodate everybody. People with

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reduced capacity for work, the remaining The Green Job Pool is to be elaborated and Another target states that Danish citizens long-term unemployed individuals, and – by extended for a four-year period. The annual and enterprises must be able to conduct all no means least – immigrants and their cost will be approximately DKK 42 million, standard business with the public sector via descendants must be ensured a place within including administration. the Internet and other new communication the labour market. − Children and young people: A special child- forms within a short span of years. A total of − During the coming parliamentary session maintenance payment of DKK 5,000 is intro- DKK 21 million is allocated for a four-year period, the Government will present Bills on duced for students. This subsidy will be period for the “Denmark on the Net”-sche- a reform of the early-retirement scheme. The adjusted according to income levels. The me; measures under this scheme include free objective of this reform will be to provide expansion of municipal day care remains a access to Statistics Denmark’s StatBank opportunities for employment for the large priority, and Danish university cities are Denmark. group of people who want a job, even called upon to utilise the existing favourable − Legal affairs: An extra DKK 200 million is al- though they do not enjoy full working capa- regulations in order to establish more youth located for the Danish courts in 2001. A- city. housing. mong other things, these funds facilitate − Senior citizens: The agreement on the continued reductions in the number of cases 5 November Budget Agreement “senior citizen package” entails better and pending at the High Courts, so that the days The government concludes its negotiations on more consistent conditions for financially of trial can be assigned within a shorter the 2001 Budget and is able to present an challenged pensioners. In addition to this, period of time. DKK 21 million is allocated agreement entered into with the Socialist Peo- agreement has been entered into on alloca- for an increase in the remuneration offered ple’s Party and the Unity List – with the Centre ting DKK 259 million to various issues con- to lay assessors. Also, a nationwide system Democratic Party taking part in a number of cerning senior citizens; e.g. for the building of automatic speed control will be estab- sub-agreements. Among other things, the over- of more dwellings for senior citizens, better lished; DKK 42 million will be allocated for all agreement includes the following elements: care and general quality of service, subsidies this purpose. − Education: The agreement entails more and for municipalities for trading of new service − Income, corporate tax, etc.: In 2001, the duty better opportunities for trainee placement, a employees working with senior citizens. on carbonated soft drinks will increase by reform of the education system for social and − Food: The Danish Veterinary and Food Admi- DKK 0.65 per litre, and the duty on pipe to- health assistants, etc., greater access to pro- nistration is to be significantly strengthened, bacco and twist tobacco will be increased duction schools and emphasis on the so that a total of DKK 35.7 million will be from DKK 52.5 per kilo to DKK 402.50 and principle regarding equal access to all youth allocated in 2001 in order to ensure conti- DKK 452.50 per kilo, respectively (total addi- education (upper secondary education), re- nuation and promotion of high levels of food tional income: DKK 200 million). Waste gardless of social and/or financial back- security and veterinary quality. duties will increase (total additional income: ground. − Transport: A total of DKK 100 million is al- DKK 60 million). A weight duty on tractors is − Research: A new concept is to be introduced, located for the period 2001-2004 for further introduced, so that registered tractors and involving the so-called “major interdiscipli- development of safety on Danish railroads. trailers attract full duties (total additional nary research groups” (“større tværgående For example, ATC systems are to be esta- income: DKK 40 million). forskergrupper”), which are to stimulate blished on the sections Vejle-Struer, Esbjerg- quality assurance and competition for re- Holsterbro, and Odense-Svendborg, and 7 November US Election search funds, as well as to promote innova- funds are allocated to abolish private cros- A marginal difference in the number of votes tion in research through collaboration across sings. The limitations on free fares for chil- cast for Vice President Al Gore and the republi- professional demarcations, institutions, sec- dren in collective transport are expanded, so can candidate George W. Bush leads to a re- tors, and the public/private sectors. A total of that a single paying adult passenger can count of the votes cast in the state of Florida. DKK 30 million a year will be allocated for bring up to two children under the age of 12 Consequently, the winner of the US presidential this purpose in the Budget. In 2001, an free of no charge. The cost of these measures election is not immediately determined. additional DKK 45 will be allocated under the is estimated at DKK 7.5 million in 2001 and government’s strategy for the business at DKK 10 million per year in the following 11 December EU Summit in Nice community. years. A total of DKK 60 million is allocated The following are central elements of the Nice In addition to this, DKK 20 million a year has for the period 2001-2004 for promotion of Treaty: been allocated for the continuance of certain traffic safety, environmental issues, and ac- − The European Commission: Each country is research programmes which are near expiry, cessibility. to have a commissioner, as long as the where such programmes are deemed to have − Health: Funding has been made available for number of Member States does not exceed future potential in terms of research and so- Danish counties to increase expenditure 27. In 2005, Germany, France, Great Britain, cial issues. DKK 10 million a year is allocated within the health-care sector by two per cent, Italy, and Spain will each lose one of their for more PhD scholarships. corresponding to DKK 0.8 billion. As regards commissioners. − The Environment: A four-year pool for ecolo- preventive work, a total of DKK 146.1 million − The Council of Ministers: The four largest gical initiatives, comprising a total of DKK has been allocated in 2001, of which DKK 30 countries will have 29 votes each, while the 178 million, is allocated with a view to pro- million has been earmarked for alcohol- smallest will have three. Denmark has seven moting urban-ecology initiatives, measures related issues, DKK 21 million for HIV/AIDS votes. If all applicant countries achieve mem- concerning ecological building, etc., and work, and DKK 5 million has been earmarked bership, the total number of votes will be measures to promote ecological behaviour for the government’s abortion action plan. 345. and solutions within local communities. − Trade and Industry: In February, the Ministry − The European Parliament: the number of The efforts to develop new energy technolo- of Trade and Industry presented its new busi- seats is increased from 626 to 732 in order to gies continue, and a total of DKK 35 a year ness strategy, entitled .dk21. This strategy accommodate new Member States. will be allocated during the period 2001- constitutes the vision and strategy of the − Veto: Is abolished in a number of cases, in- 2004. Danish government for a competitive Danish cluding the issue of appointments within the A four-year chemicals plan is implemented in business community. A total of DKK 329.5 EU. The right of veto is partially abolished in order to reduce the quantities and impact of million is allocated for initiatives regarding connection with trade agreements, with the chemicals. The cost of this plan will be DKK the five focus areas of this strategy, which exception of agreements on television and 36.8 million in 2001, and an annual average includes the following targets: Denmark films. of DKK 31.3 million in 2002-2004. This Plan must have a constructive partnership − Certain issues concerning asylum and immi- comprises a large number of initiatives which between the business community and the gration will be determined by means of the will boost future efforts on chemicals. public sector on the formulation of new so-called qualified majority (QMV) in the Enhanced nature administration will be insti- legislation and rules intended to help ease Council of Ministers from 2004 onwards. gated. This will include nature rehabilitation, the administrative burdens imposed on en- − The right of veto is upheld on issues concer- afforestation, nature guides/communication terprises; Denmark must be more competitive ning taxes and social security. of issues concerning nature, and preservation and enjoy better, more successful markets, − Enhanced cooperation: At least eight Mem- of culture environments. A total of DKK 80 and Denmark must evolve into being an even ber States may jointly initiate enhanced co- million a year will be allocated for this more international community, e.g. by means operation. This must, however, be approved purpose. of “export-growth groups”, etc. by a qualified majority within the Council of Ministers. Cooperation on foreign-policy

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matters can be stopped if a single Member Minister for Housing and Urban Affairs and Dahlgaard, who voted neither in favour nor State issues a veto. Enhanced cooperation Minister for Equal Opportunities: against the adoption. may not involve defence issues or issues Lotte Bundsgaard (S) which entail military consequences. Minister for Taxation: Frode Sørensen (S) 28 Aug. Budget for 2002 − Austria Clause: Where a Member State acts Minister for Ecclesiastical The Minister for Finance presents Bill no. 239 of contrary to the basic norms of the EU, the EU Affairs: Johannes Lebech (R) 28 August on the Budget for the fiscal year may issue recommendations for such coun- Minister for Health: Arne Rolighed (S) 2002. tries if 80 per cent of the Member States so Minister for Development decide. Cooperation: Anita Bay Bundegaard (R) 11 Sep. Terrorist attack on the USA A total of four domestic US flights are hijacked

14 December George W. Bush is by terrorists. Two planes hit the World Trade the new president of the USA 2001 Centre in New York, one hits the Pentagon in After a period since the US election on 7 No- Washington, and one crashes to the ground in vember 2000 characterised by recounts of votes 8 January BSE Scare Pennsylvania. The total casualties were more and legal proceedings concerning errors in the The Ministry of Food, Agriculture, and Fisheries than 3,000 people. election procedures in the state of Florida, announces that a cow from a farm in Fjerritslev Democrat Al Gore ceases his fight for the in the northern part of Jutland may be infected 24 Sep. Pressure on the financial markets presidency. This means that Republican George with BSE – mad-cow disease. is alleviated W. Bush will be the new president of the USA. Due to the major losses on the stock markets This decision is made after a ruling by the US 20 January New President of the USA since the attack on the USA on 11 September, Supreme Court decided that the ongoing The Republican George W. Bush is inaugurated the Danish Ministry of Economic Affairs recounts in Florida are invalid. as the 43rd president of the USA. announces that the government will temporarily allay the solvency requirements for life and 21 December Government Reshuffle 6 February No BSE in Denmark pension funds. These measures will help relieve The Danish Prime Minister, Poul Nyrup Rasmus- The suspicion of mad-cow disease at the farm in pressure on the financial markets, providing sen, announces that the government carries out Fjerritslev proves unfounded. funds with a better basis for making long-term a reshuffle. The Minister for Foreign Affairs, decisions. The initiatives were debated on a Niels Helveg Petersen, the Minister for Housing 13 March The USA introduces a ban meeting between the Minister for Economic and Urban Affairs and Minister for Equal Oppor- on imports from the EU Affairs and Forsikring & Pension, which looked tunities, Jytte Andersen, the Minister for Defen- The US Agricultural Department introduces a favourably upon the government’s plans. (Act ce, Hans Hækkerup, and the Minister for Health, ban on imports of meat from the EU as it beco- L6, adopted on 11/10 2001) Sonja Mikkelsen, all step down from govern- mes known that the foot-and-mouth disease has ment. spread to France. During the preceding weeks, 2 Oct. Government programme This forth Nyrup Rasmussen government in- Great Britain has suffered greatly from foot-and- The Folketing is back in session. In his opening cludes five new faces: Minister for Housing and mouth disease. statement, Prime Minister Poul Nyrup Minister for Equal Opportunities: Lotte Bunds- Rasmussen takes the terrorist actions of 11 gaard; Minister for Taxation: Frode Sørensen; 24 March The EU Summit in Stockholm September as his starting point, focusing on Minister for Ecclesiastical Affairs: Johannes At the Summit, agreement was entered into on how Denmark and other communities now face Lebech; Minister for Health: Arne Rolighed; and the following issues: a new, worldwide threat that must be fought Minister for Development Cooperation: Anita − A full liberalisation of the electricity and gas through international collaboration, with the UN Bay Bundegaard. sectors must be carried out “as soon as acting as the focal point. The following list The former Minister for Taxation, Ole Stavad, possible”. contains examples of the government’s the former Minister for Trade and Industry, Pia − Agreement was entered into on the presen- proposals, where the main emphasis is placed Gjellerup, and the former Minister for Finance, tation of common goals for employment on combating international terrorism: Mogens Lykketoft, all change their position, when the countries have progressed half-way − Legislation must be carried out in order to henceforth holding the positions as Minister for through the Lisbon Process in 2005 (cf. the prevent and disable funding of terrorism. Trade and Industry, Minister for Finance, and Lisbon Summit, 24 March 2000). A total of − The Penal Code must be amended to take Minister for Foreign Affairs, respectively. The 67 per cent of the total labour force must into account the networks of international former Minister for Development Cooperation, have employment at that time; the target for terrorism. Jan Trøjborg, takes over the position as Minister women is 57 per cent. − Extradition of terrorists must be made easier. for Defence. Finally, the position as Minister for − The postal sector must undergo a reform. − A common definition of terrorism and a Ecclesiastical Affairs is transferred to Johannes − The financial sector must undergo a reform. common judicial framework must be Lebech from Margrethe Vestager, who will hen- prepared within the EU. Police collaboration ceforth concentrate exclusively on her position 15 May Major American investment in Hillerød on practical matters must be strengthened. as Minister for Education. The American pharmaceutical corporation − A number of amendments must be made to Following the reshuffle, the Danish government BIOGEN signs an agreement detailing the buil- the Aliens Act. These amendments must comprises the following ministers: ding of a large production facility in Hillerød, follow up the decisions made by the EU and Prime Minister: Poul Nyrup Rasmussen (S) near Copenhagen. BIOGEN expects to invest the UN Security Council. This means that: Minister for Economic Affairs and Minister for approximately DKK 3 billion in production facili- − We must expand collaboration between Nordic Cooperation: Marianne Jelved (R) ties. The production at Hillerød is to cover the the police intelligence and the aliens Minister for Foreign Affairs: Mogens Lykketoft (S) entire European market, and one of the reasons authorities. This is partly to ensure that Minister for Finance: Pia Gjellerup (S) why Denmark was chosen was the easy access foreigners will not receive a residence Minister for the Environment to qualified employees. permit when such a refusal is necessary and Energy: Svend Auken (S) for the safety of the nation. Minister for IT and Research: Birte Weiss (S) 25 May USA resumes import of meat products − Minister for Education: Margrethe Vestager (R) We must take all the necessary Following an import ban on meat products from precautions to investigate and ensure Minister for Defence: Jan Trøjborg (S) the EU lasting more than two months, the US Minister for Home Affairs: Karen Jespersen (S) that asylum seekers have not taken part once again allows imports from a number of in terrorist actions. We must ensure that Minister for Food, Agriculture, European countries. and Fisheries: Ritt Bjerregaard (S) the asylum system is not abused by terrorists or those who support terrorism. Minister for Justice: Frank Jensen (S) 1 June Denmark ratifies the Nice Treaty Minister for Social Affairs: At the last working day of the Danish Parliament − Terrorists and their active supporters will Henrik Dam Kristensen (S) – Folketinget – the parliament made the final not be granted asylum in Denmark or Minister for Trade and Industry: Ole Stavad (S) adoption of the Act on Denmark’s accession to any other place in the world – they must Minister for Cultural Affairs: the Nice Treaty. The only votes against came answer for their deeds. Elsebeth Gerner Nielsen (R) from the Unity List, the Danish People’s Party, − Efforts against the smuggling of people and Minister for Labour: Ove Hygum (S) and the non-party candidates – excepting Frank money laundering must be redoubled. This Minister for Transport: Jacob Buksti (S) will also entail legislative changes.

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− The Danish intelligence services must be 21 Nov. Merger of Danish Crown involved in order to procure employment for as strengthened – both the Danish Police and Steff-Houlberg many unemployed individuals as possible. Intelligence Unit (PET) and Forsvarets The major food companies Danish Crown and In order to promote flexibility and mobility Efterretningstjeneste (the Danish armed Steff-Houlberg have decided to merge the two within the labour market, it should be possible forces’ intelligence service). This is absolutely enterprises with retroactive effect as from 1 to establish interdisciplinary unemployment crucial if we are to discharge our October 2001. The merger may not, however, be funds in order to increase the opportunities for international obligations. This requires more carried out before it has been approved by the providing unemployed members with offers that resources, more manpower, and more competition authorities. go beyond their usual sphere of activity. investment. − The Emergency Act must be amended. In 26 Nov. Government agenda for the next Parental leave: As at 1 January 2002, all parents light of the terrorist attack on 11 September four years of newborn children will be entitled to one year 2001, coordination must be increased in The future Liberal-Conservative government of flexible parental leave with full unemploy- order to ensure better consistency between presents its agenda for the next four years. The ment benefit. The parents themselves decide the various authorities’ contingency plans, following are excerpts: who should take the parental leave period. etc. This will also involve the establishment The economy: The government will pursue a of a central epidemic council and an rigid economic policy aiming at creating the Health: If the public hospital service cannot offer extension of Nordic collaboration. greatest possible number of jobs in the private examinations and treatment within two months, − The Penal Code is to be amended in order to sector, at reducing the national debt, and at patients will as from 1 July 2002 have the make punishment for rape much more lowering taxes. There is a need for a long-term, opportunity to choose treatment at a private severe. stable economic policy providing enterprises and hospital in Denmark or abroad, with all medical − The conditions of children and families with citizens with the calmness and security they expenses paid. The government will allocate children must be improved. This is to be done need to make their decisions. DKK 1.5 billion to reducing waiting lists. by means of an extended parental leave − The monetary policy of maintaining a fixed period, which is also made more flexible. Aliens policy: The government will prepare a − rate of exchange will be continued. The Labour-market policies are to change their krone will remain linked to the euro within comprehensive proposal for a marked tightening focus. Efforts must be targeted more the narrow fluctuation margin, and fiscal of Danish legislation on aliens and immigration, specifically at what individuals can do and policies will take this into account. and will present an action programme for better the job opportunities available in the local − Fiscal policy will aim at ensuring a reduction integration of immigrants. community. The main elements in this of the national debt and interest expenditure reorientation are a simpler set of rules, up until 2010. Foreign assistance: The government will reduce increased digitalisation of the administration, − The balance of payments must show a the funds allocated for development assistance more target-specific efforts, improvements in healthy surplus, so that the foreign debt can and environmental assistance to developing the service provided to enterprises and countries by a total of DKK 1.5 billion. be paid as quickly as possible. individual users, changes in financial − Inflation and interest rates must be kept at management, and greater regionalisation. 27 Nov. New Liberal-Conservative government − low levels. Greater emphasis must be placed on The new government comprises 18 ministers, improving the working environment. which is three less that the previous government − Deregulation: The government will deregulate The qualifications of “new Danes” must be the Danish electricity and gas markets in order replaced by the Danish Liberal Party (V) and the put to better use, and attention must be to increase efficiency within energy production Conservative People’s Party (C). 12 ministers are focused on integration policies with especial and reduce consumer prices. The government from the Danish Liberal Party (“Venstre”), while focus on skills and duties. 6 come from the Conservative People’s Party − will also prepare for privatisation of DONG and Senior-citizen policies must be enhanced in PostDenmark. (“Det Konservative Folkeparti”): close collaboration with enterprises. Prime Minister Anders Fogh Rasmussen (V) − More staff must be trained within the health Taxes: A tax freeze is introduced at state, Minister for Economic Affairs and Minister for service, and it has been agreed with the county, and municipal levels. This means that Nordic Co-operation Bendt Bendtsen (C) counties that an additional 120,000 people the government will not raise any taxes or Minister for Foreign Affairs Per Stig Møller (C) will receive treatment during the next three duties. Increases in taxes on real property are Minister for Finance Thor Pedersen (V) years. Also, waiting lists must be reduced to also frozen, which means that they cannot Minister for EmploymentClaus Hjort Frederiksen(V) less than three months. Minister for Justice Lene Espersen (C) exceed the amount paid by the house-owner in 2001. Provided that the necessary room for Minister for Cultural Affairs Brian Mikkelsen (C) 7 Oct. The USA attacks Afghanistan manoeuvre has been established, the Minister for Refugee, Immigration and Integra- Almost a month after the terrorist attack on 11 government will propose a reduction in income tion Affairs and Minister without Portfolio September, the USA retaliates by launching a taxes, effective as from 1 January 2004. (Minister for European Affairs) Bertel Haarder (V) massive attack on Afghanistan in an attempt at Minister for Taxation Svend Erik Hovmand (V) combating Osama bin Laden and his al-Qaeda Business and industry: The government wishes Minister for Transport Flemming Hansen (C) network. to pursue an industrial policy which improves Minister for Science, Technology and the competitiveness of enterprises through Development Helge Sander (V) 20 Nov. General election target-specific reductions in taxes and Minister for Food, Agriculture and The general election results in the following administrative burdens, etc. A dynamic Fisheries Mariann Fischer Boel (V) distribution of seats in the Folketing: entrepreneurial policy will make it more Minister for Defence Svend Aage Jensby (V) attractive to start and run one’s own business. A Minister for the Party Seats Environment Hans Christian Schmidt (V) The Social Democrats...... 52 proposal will be launched with a view to promoting the opportunities for saving up to Minister for the Interior The Social-Liberal Party...... 9 and Health Lars Løkke Rasmussen (V) The Conservative People’s Party ...... 16 establish one’s own enterprise. The government will also present an action plan by the name of Minister for Ecclesiastical Affairs Tove Fergo (V) The Socialist People’s Party...... 12 Minister for Education Ulla Tørnæs (V) The Danish People’s Party...... 22 ”More Entrepreneurs”(“Flere iværksættere”), which will contain a wide range of initiatives to Minister for Social Affairs and Minister for The Christian People’s Party...... 4 Gender Affairs Henriette Kjær (C) Venstre – Denmark’s Liberal Party ...... 56 encourage self-employment. The Red-Green Alliance...... 4 As reductions in subsidies to the agricultural Total...... 175 sector are carried out, taxation of arable land will be phased out. 2002 The last general election was held on 11 March 1998. The labour market: The government will propose 1 Jan. The Euro is put into circulation in the 20 Nov. Local government elections liberalisation of the job provision/placement euro zone Elections for the municipal and county sector in order to create more, competing On 1 January 2002, the euro is put into authorities were held at the same time as the employment services. This reform will aim at circulation in the euro zone, and the central general election. creating financial incentives for all parties banks begin calling in the national currencies.

b b Political-economic calendar 201

During a period of up to two months, it will be A pool of DKK 150 million will be spent on proposal from August, was withdrawn. The DKK possible to use national notes and coins as well various social improvements. 650 million will be funded from State reserves as euros in all shops, but as from 1 March, only Heating supplements for pensioners are instead. the euro will be legal tender in the euro zone. improved with a standard allowance of ten per Denmark has, like Sweden and Great Britain, not cent from 1 January 2003. 21 Feb. Collective agreement for 650,000 introduced the euro. The Danish krone is, Maternity/paternity leave: The leave period is public-sector employees however, closely linked to the euro through the extended to 52 weeks with full unemployment The negotiations on a new collective agreement monetary system. benefit, and it is made more flexible, allowing for 650,000 teachers, nurses, and other parents to take part of the leave period later. It employees within Danish counties and 11 Jan. A number of committees are will also be possible to extend the leave period municipalities were concluded by conciliation. abolished by an additional 14 weeks on a lower benefit. The agreement will span a three-year period. The new government presents its plan for “More The old parental leave scheme (“forældreorlov”) Employees will receive two extra holidays a welfare and less bureaucracy – sanitising coun- is abolished. Parents of children born between 1 year, and will also receive a general pay cils, boards, committees, and centres”. Ap- January 2001 and the time this Act was adopted increase of 5.55 per cent over a three-year proximately 150 councils and boards will either may choose which of the schemes they wish to period. This will be an improvement in real be closed down or merged. This reorganisation use. income if the projections for a total inflation rate of councils, boards, committees, and centres is Research and IT: The government will allocate of 5.1 per cent prove accurate. A total of 1.87 expected to yield total savings of approximately an additional DKK 400 million to research and IT per cent of the total wages is earmarked for DKK 0.3 billion in 2002. It will also entail signifi- issues. This will be funded by the so-called local negotiations. cant further savings on subsidies and pool UMTS funds from the auction on mobile schemes. communication licences. 20 Mar. The Finance Act for 2002 is Pension schemes: The Special Pension Saving adopted. 29 Jan. Budget for 2002 Scheme, which is a compulsory contribution The 2002 Finance Act was adopted by a majority The new government wishes to redirect DKK 7 amounting to 1 per cent of all Danes’ wages, of 98 votes against 10. All parties in the billion in order to ensure better hospitals, care will be turned into an individual pension Folketing except the Socialist People’s Party and for the elderly, and maternity/paternity leave scheme, and it will be possible to make deposits the Danish Red-Green Alliance voted in favour schemes in relation to the Budget proposed in with companies other than ATP. Under the of the Act. (No. 70, 2002) August by the previous government. Taxes must present scheme, all contributors will receive the not rise. same amount. In future, each contributor will 14 June Agreement between the The increased expenditure is to be financed by receive his/her own contribution plus interest. government and Local Government Denmark means of savings on central government Business and industry: A business package to about municipal finances expenditure (DKK 4.5 billion) and on assistance an amount of DKK 500 million is to improve the The agreement for 2003 is the first to follow the to developing countries and Eastern Europe competitiveness of the Danish business four-year agreement ending at the end of 2002, (DKK 1.5 billion) in 2002. In addition to this, community. The elements of this package as well as the first agreement following the budgetary improvements to the amount of DKK include more lenient periods of credit for VAT change of government in November. As a result, 1 billion are expected. This proposal will form and a higher VAT limit, so that more small the negotiation situation has been different from the basis of negotiations with the other parties enterprises need not prepare VAT accounts. It that of the preceding years. in the Folketing, to be conducted during the next will also be made more attractive for enterprises The main theme of this year’s negotiations has month. to pay out part of their employees’ salaries in been the issue of the basis for calculations of the form of shares. the growth limits and their size. Other relevant The armed forces: Working with the Social themes in the negotiations include levels of 6 Feb. Agreement on the Budget between Democratic Party, the Social-Liberal Party, and construction activity and lending opportunities, the Danish People’s Party and the government the Christian People’s Party, the government will particularly for the building of schools; The Danish People’s Party and the government seek to reach agreement on spending a total of accordance between signals, the growth limit agree on the Budget for 2002. The negotiations DKK 750 million over a period of two years for and municipal degrees of freedom. In addition resulted in fewer savings on education, and the international military tasks. These funds are to to this, the Folkeskole (primary and lower- already improved parental leave scheme can be taken from the Environment, Peace, and secondary education) has been a theme in its now extend to 66 weeks, albeit with lower Stability Fund. own right. benefits. Social improvements: The exact use of the This agreement does not leave any room for any special pool for social improvements, amounting expansions in the services provided by Local The key elements of the final Budget: to a total of DKK 140 million this year, will be Government Denmark municipalities as a whole, Hospitals: More treatments at hospitals and determined in collaboration with the Social and the municipal taxes must not go up in 2003. open choices within the health area. Hospitals Democratic Party, the Danish Social-Liberal If a given municipality wishes to raise its level of will receive an additional DKK 1.5 billion Party, the Socialist People’s Party, and the service within specific areas, this can only be towards shorter waiting lists. This money will go Christian People’s Party. done by corresponding changes in the priorities to the counties that ensure greater levels of of other fields. The agreement provides activity at their hospitals. Access to the hospital SAVINGS: opportunities for counteracting the demographic of your choice is also introduced, allowing Central government: When compared to the pressures in terms of expenditure within patients to choose between going to a private 2001 Budget, economies must be made within municipalities in general next year. It will, hospital in Denmark or treatment abroad, if the the central government sector. Budgetary however, also mean that some municipalities public sector cannot offer treatment within two improvements of 1, 3, 5, and 7 per cent during face a need for serious economising next year. months. the years 2002-2005 have been included in the The elderly: Care for the elderly must be calculations. The police and the armed forces 14 June The government and the Association improved, and an additional DKK 500 million is are exempt from these savings. of County Councils in Denmark allocated to this area. The elderly must also be A total of DKK 2.2 billion will be saved by agree on county finances in 2003 allowed to choose the type of home care they phasing out or cutting back a number of pools With this agreement, the government and the prefer, and should be able to choose their rest and subsidies. The state subsidy for home care counties agree to accord high priority to the home themselves. All senior citizens have a right will be cut by 50 per cent. The subsidy for health sector, which will receive additional to bring their spouses with them at the rest cleaning will be reduced from 50 to 40 per cent, funds of DKK 1.2 billion in 2003 – comprising home of their choice. Private housing and subsidies for all other services will be DKK 750 million for expansion within the foundations for the elderly will receive an discontinued. hospital area and DKK 500 million to cover additional DKK 75 million for improvements. Foreign assistance and environmental support increasing expenditure on medicine. With this The much-debated “death package” is to developing countries will contribute savings agreement, counties are contributing to abolished. This means that bereaved spouses of DKK 1.5 billion. maintaining the tax freeze, which means that will receive double social pensions for three the rate of taxation on personal income must months after the death of their spouse in all The proposal for extra savings of DKK 650 remain unchanged in 2003. cases where both spouses receive social million on education, which the new pensions. This will cost DKK 160 million. government added to the old government’s