Welfare scandal shakes a nation

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NEWS ANALYSIS: It didn’t take Norwegian media outlets long to find and interview real victims of an unprecedented scandal that’s still unfolding at Norway’s state welfare agency NAV. As headlines like “I was viewed as a criminal” splashed over newspapers’ front pages on Wednesday, and women wrongly convicted of welfare fraud cried on national newscasts, the painful aftermath of NAV’s seven-year-long misintepretation of rules regarding sick pay and unemployment benefits is emerging in full force, and shaking the confidence Norwegians need to have in their welfare state.

Norwegian newspapers have been packed with stories this week about the still-emerging scandal at state welfare agency NAV. The headlines are getting worse, as more and more individual victims’ stories come out. PHOTO: newsinenglish.no

The stories are all about innocent Norwegians who were fined, ordered to pay back large sums of money, convicted and even jailed for having traveled abroad while receiving benefits from NAV. While Norwegian law forbids such travel without special permission, EU regulations have permitted it in line with the EU’s free movement of goods and services across borders. That means scores if not thousands of Norwegians and legal residents of Norway have been punished for crimes they did not commit.

The EU position was clarified in 2012 and Norway, as a member of the EU’s European Economic Area, was supposed to follow it but misinterpreted it until just recently. At least 2,400 people have thus been wrongly ordered to refund benefits and have not received benefits to which they were entitled. At least 48 people have been wrongly convicted in a court system that also failed to pick up on the discrepancy between Norwegian and EU rules until a few questions began being raised in 2017. Even so, the illegal rules continued to be enforced.

‘Lives ruined’
One man, a now-61-year-old immigrant from Greece, remains under threat of deportation as well: Bergens Tidende (BT) reported how he came to Norway in 1982, started working, married a Norwegian and had children. He maintained his Greek citizenship, worked and paid taxes for many years until his health failed in 2008 and he started receiving the equivalent of workers’ compensation. NAV wrongly charged him with fraudulently receiving NOK 452,676 in benefits over a two-year period, because he had traveled back to Greece to visit his elderly mother. “She was sick and needed help,” he told BT.

He was also wrongly convicted of welfare fraud and issued a 60-day jail term, albeit suspended but enough to jeopardize his residence status as an immigrant in Norway. Not only have all the charges against him exacerbated his heart condition and drained him financially, he also received an “advance notice of deportation” from state immigration agency UDI (Utlendingsdirektoratet). After nearly 40 years in Norway, his conviction for welfare fraud triggered a deportation case. “This case has ruined my life,” he told BT, and he’s not alone.

Now his lawyer will ask UDI to halt any deportation proceedings until his entire case can be reviewed. “This is a scandal,” lawyer Sverre Skimmeland told BT. “I am certain there are thousands of others who have also been wrongly subjected to rules being practiced incorrectly.”

Systemwide failure
Worse are the suspicions of Skimmeland and many others that it wasn’t just NAV that mistakenly intepreted the rules but that police, prosecutors and even the courts failed to do their jobs. Newspaper Aftenposten editorialized on Wednesday that the scandal has led to “both a legal and political crisis,” because innocent people have been convicted and jailed for things they did that were not illegal. Authorities at many levels continued what had been common practice and it was not questioned.

“What’s happened here can only be blamed on professional failure throughout NAV, the police and the courts,” Professor Jan Fridtjof Bernt, who specializes in public managment law at the University of Bergen, told newspaper Dagens Næringsliv (DN). “We must remember that not only NAV has made mistakes, but also the prosecutors (who wrongly took NAV’s errant charges against alleged welfare swindlers to court) and the courts (whose judges failed to notice the discrepancy between Norwegian and EU regulations).”

“I find it less upsetting that NAV made mistakes than that courts issued convictions on insufficient judicial grounds,” Bernt told DN. He stressed that it’s the prosecutors’ and judges’ jobs to also uncover fault at Norway’s public agencies. “It’s disturbing that no one within the prosecutors’ offices or the courts have discovered the clearly apparent mistakes in now NAV understood the rules.”

NAV employees unhappy and worried
NAV employees, meanwhile, are also critical of NAV’s management and deeply worried about how the public will react to them as they continue to handle individual cases. The extent of the scandal spreads nationwide, with wrongful convictions issued by 23 courts from Fredrikstad in the south to Salten in the north. A team of 15 NAV employees has been set up to handle the complaints that are sure to come in, as others review cases of the 2,400 already suspected of having been wronged. At the same time, NAV employees need to attend to business as usual, and fear they may have lost the public’s respect.

“Some people lose their tempers in meetings with NAV,” Torgeir Homme, who represents NAV employees in their labour organization NTL (Norsk Tjestemannslag), told newspaper Dagsavisen. “There’s a risk of increased aggression on the part of some people.”

Homme is also unhappy that NAV management gave no advance warning to staff of the scandal that was about to break on Monday, meaning that most learned of it through the media. “We’re not super-happy that we (in the union) didn’t know a thing either until it hit the media,” Homme said.

Shared ‘political crisis’
As for charges of a “political crisis” in addition to an administrative one,  it’s also important to note that the misinterpretation of EU rules began during the last left-center government and then continued under the current conservative government coalition. Opposition politicians in Parliament from the left-center parties must therefore be careful in criticizing the current government ministers who hold political reponsibility now, since their own left-center ministers were in charge when the mistakes began being made.

That didn’t stop Sigbjørn Gjelsvik, finance policy spokesperson for the Center Party, from complaining to newspaper Aftenposten on Wednesday that current Labour and Social Welfare Minister Anniken Hauglie of the Conservative Party should have informed Parliament about the mistaken practice of EU rules much earlier. The enormity of the scandal wasn’t revealed until a press conference in Oslo on Monday afternoon featuring Hauglie, NAV director Sigrun Vågeng and state prosecutor Tor-Aksel Busch. The latter has also said he wasn’t informed of the simmering scandal until just two weeks ago.

Calls are already going out for the resignation of NAV director Sigrun Vågeng. PHOTO: NRK screen grab

Gjelsvik, meanwhile, represents a party that has also opposed not only EU membership but also Norway’s trade agreement with the EU that obliges Norway to follow EU rules. The NAV scandal has already fueled their criticism of and opposition to the EEA/EØS agreement, and is now testing those who support it. Many Norwegians feel Norway is far too beholden to the EU already, even though its rules are often far more flexible and liberal than Norway’s. Politicians, and not least Gjelsvik who once ended a lobbying group opposed to the EEA/EØS agreement, will surely exploit the NAV scandal for political purposes.

Hauglie has already said she’ll launch an external investigation of how the EU/EØS rules could have been misinterpreted so seriously for so long. She has admitted that the trouble at NAV “is as close to a scandal as you can get,” adding that it’s “extremely serious” when people are wrongly charged, convicted and face large repayment demands from NAV.

“I apologize to those affected and their families,” Hauglie stated. “Everyone with a right to Norwegian welfare benefits must be able to rely on rules being practiced correctly. We will get to the bottom of what has happened, and learn from it for the future.” She has also asked to be able to address Parliament, to account for the status of the situation at present.

newsinenglish.no/Nina Berglund