Poverty hits 10 percent in Oslo

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Government figures released on Tuesday show that 9.68 percent of residents in the Norwegian capital Oslo are defined as living in poverty, giving the city the worst figures in the whole country.

Oslo's City Hall lit up with Christmas lights. The poverty and divisions in the capital have been revealed by the new government figures. PHOTO: Views and News

The country-wide level of poverty in Norway lies at 4.5 percent, which translates into 215,415 people. But the level is Oslo is significantly higher, with 54,282 now below the poverty line.

The official poverty line is calculated regionally, with those earning under 50 percent of the median wage in the local authority area considered as living in poverty. Social security is not included, and students and those with assets three times larger than the median income are also not counted. The poverty line is calculated on the basis of individuals living alone, with those living together in the same household having a lower limit. Those is Oslo who earn NOK 128,003 (USD 24,399) after tax are considered to be living in poverty, whereas the lowest limit found elsewhere in Norway is NOK 105,645 (USD 20,137). The highest percentage of those living in poverty found outside of the capital is 8 percent in Modalen in the Sogn and Fjordane region.

‘Don’t just count’
Tone Fløtten, a poverty researcher at Fafo, told Norwegian Broadcasting (NRK) that the level of poverty in Oslo “is connected to a very high degree with the population and the proportion of immigrants.” The researcher warned that “it does not help to count the amount in poverty if you just count,” encouraging politicians to come forward with new measures and policies.

Members of the city council administration in Oslo also commented on the news. The council member responsible for social issues, Anniken Hauglie of the Conservative Party, told NRK that the poverty levels were “a high number, and that is why the city council is so busy with securing good schools for children and work for adults.” She suggested that a number of local measures to address low incomes were not factored into the government statistics, such as “voluntary work provision and free holidays.” She believes that the “record growth in immigration” in recent years, which has made the capital “the biggest immigration area,” was responsible for the figures. “From previous studies, we know that on the whole it is immigrant families that have lower incomes than the rest of the population, therefore these numbers are not that unnatural,” she added.

Growing debate on poverty
Hauglie’s party has been part of a growing debate on the issue of poverty reduction in the country in recent times. Over the weekend, internal debate raged at a national Conservative Party meeting on whether to institute a minimum wage in Norway along the lines of the American or British system. A number of local Conservative politicians, principally from Oslo, are for the proposal, but the idea met opposition from their national work and social policy spokesperson, Torbjørn Røe Isaksen, who expressed fears when speaking to newspaper Dagsavisen that “a minimum wage will become in practice a maximum wage” and strengthen employers’ desire to fight wage increases.

The proposer of the policy, Michael Tetzschner, suggested on the other hand that the idea would fight social dumping in places where “an influx of immigrants looking for work from EU countries has led to unacceptably low wages,” a problem that could lead to “severe discord” in the future. Some employers’ organizations are in favour of a minimum wage, which is strongly opposed by trade unions.

In recent days, Norway was once again named as the best country in the world in which to be a mother by Save the Children, while other figures recently released revealed that 85,000 children were living in poverty in the country. As with the more general situation, child poverty is most severe in the relatively poorer and more ethnically-diverse east side of Oslo. Meanwhile, unemployment remains low in the country and has continued to decrease in recent months, falling in April by 1,200 to 1.8 percent of the workforce.

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  • What I like best about Norway as an American is that there is no minimum wage. This establishes competition among companies seeking to pay low wages. Just the other night on the phone with a friends I was describing this as one of Norway’s greatest strengths. See he is at this point in his life taking settling down and finding a wife more seriously. He has looked, but has found that there most of the girls he’s dated treat their mating as a financial transaction. They are hunting for a good provider because in the U.S., the lower wage earners earn a great deal less than professionals. Here in Norway, McDonald’s advertises on their website that they pay 113NOK per hour for employees over 20 with benefits. That’s 226,000 NOK per year. While that’s not a lot of money, it is enough that two people earning that much and live together and even buy an apartment and eventually a flat.

    In America, the minimum wage in Florida is $7.76 an hour which is about 43NOK per hour or 86,000NOK per year. Two people earning this much will starve without running up credit card debt which they’ll default on to survive.

    The lack of a minimum wage in Norway makes it so that companies like McDonalds or gas stations have to be competitive about their wages to hire employees. This makes it so that for example in the case of my friend, he can know that whatever girl he finds he’s interested in is in it for non-fiduciary reasons.

    I’ll pose one of the weaknesses with the research which wasn’t covered… though it might have been in the original report. 1) Foreigners tend to work in positions where cash is the normal form of payment. This means driving taxis, working at kebab shops, working at immigrant shops, etc… the amount of money taxed vs the amount of money paid will differ greatly. This isn’t just immigrants, ask the Norwegian workers at Hard Rock or TGI Fridays what percentage of their tips they pay tax on… they’ll probably say “the tips which are paid on card, not the ones paid in cash”.

    Most of my middle-eastern immigrant friends run their personal businesses using shelf corporations they purchased from other countries. This makes it so they are in fact earning money legally, but not always bringing the money back into Norway legally. Unlike Norwegians who are hardwired to simply gripe about the insane tax rates in Norway, foreigners are more likely to work around the system. This isn’t an option for people in standard 9-5 positions, but is easy for people who work in less “formal” environments. So, they claim as little on their taxes as possible… yet, I’d be interested in seeing what percentage of those below the poverty line have expensive cars and 46″ LED TVs at home and always have cash in their pockets.

    If you want to eliminate Norwegian poverty, start by eliminating cash as a currency. You’ll find that all of a sudden, most poverty will go away.