Norway: New government likely to be a Labour-led coalition
August 31, 2021
Norwegians are gearing up to head to the polls on 13 September to elect a new parliament. Incumbent Prime Minister Erna Solberg, whose minority conservative-led coalition has been in power since 2013, is unlikely to win a third term, and estimates see the center-left Labour Party coming out on top, although the new government will most likely be a coalition again. The reshuffle could see left-leaning parties securing more sway in parliament, with future oil policy set to be a key issue in the run-up to the vote.
Although support for the Conservative Party remains strong—polls project it to win 20% of the popular vote—as Solberg has been widely praised for her management of the Covid-19 pandemic, swiftly implementing lockdown measures that prevented high mortality rates in the country. However, the party leader has been criticized over economic inequality and for implementing unpopular public sector reforms. Moreover, support for the other coalition partners—the Liberal Party and the Christian Democratic Party—has dropped. In fact, these two government supporters may not reach the 4% threshold required to secure parliamentary seats in the coming vote.
The stage seems set, therefore, for a shift in power. Projections show Labour Party leader Jonas Gahr Støre leading the polls, with 25% of the vote. Key campaign policies include tax relief for low- and middle-income families, a tax hike for the top 20% of earners, the end of privatized public services and more funds for hospitals. However, the current vote share would not be enough to secure an outright majority and would force the new PM to negotiate a power-sharing agreement with left-leaning groups. Estimates show that center-left parties could take up to 114 parliamentary seats—out of the total of 169—markedly up from the current 81 they currently hold.
Among the parties who would be seeking to influence a Labour-led government are the Socialist Left Party, which opposes membership of NATO and the European Economic Association and is currently projected to obtain 9% of the vote, as well as the Green Party and the far-left, eurosceptic Red Party, which are both expected to attain more representation in parliament. Complicating matters further, the Centre Party, which opposes immigration and controversial local government reforms, and has spoken out against close ties with the EU, could emerge as the third strongest party—polls see an estimated 13% of the vote.
Meanwhile, the publication of the United Nations’ landmark climate report in early August has heated up the debate over future oil policy. Oil and gas exploration is the country’s most important industry—employing around 200,000 people—and output has contributed USD 1.4 trillion to the sovereign wealth fund. Larger parties such as Labour, the Conservatives and the Center Party are interested in providing more licenses, while smaller parties, namely the Socialist Left Party, the Liberals and the Greens, are demanding a halt to extending licenses and to exploration. However, with none of the biggest parties expected to win a majority, policy implementation in this key area, and in others, could become a challenge.
Author: Marta Casanovas , Junior Economist