“I’m sorry … I apologize … I accept criticism … with the benefit of hindsight … I beg your pardon.” That refrain became all but standard during two days of parliamentary hearings that ended Friday into the unprecedented scandal at Norway’s state welfare agency NAV. It remains unclear, however, whether any of those responsible will lose their jobs or otherwise pay any price.
A lengthy string of top politicians and bureaucrats flat out admitted to everything from lack of competence to utterly failing to understand how serious NAV’s misin-trepetation of EU/EEA regulations really was. And that seems to form their collective defense: since everyone involved was at fault, from the administrative to the judicial to the political level, it may prove difficult to fault any single person along the way.
Both the government minister in charge of NAV, Anniken Hauglie of the Conservative Party, and the managing director of NAV, Sigrun Vågeng, readily took what they called their “share” of the blame. Neither, however, has volunteered to resign or take full responsibility for the scandal that wrongly stripped valid recipients of their sick pay or unemployment benefits, ordered many to repay large sums to NAV and, worst of all, left them wrongly convicted of welfare fraud. At least 48 innocent people were sent to jail.
“This is not symptomatic of how we handle (welfare) cases at NAV, but we didn’t understand we could have been doing anything wrong,” Vågeng testified during the second day of hearings on Friday. She and her NAV colleagues were convinced their practice of denying benefits to Norwegians who traveled abroad, and thereby restricting their “export,” was in line with Norwegian law. The problem was that EU regulations can supercede Norwegian law under terms of Norway’s trade and policy agreement with the EU.
When the court that handles welfare cases (Trygderetten) first ruled against NAV in 2017, finally indicating that NAV’s practice was wrong, “we didn’t understand how serious that was,” Vågeng testified. She added that it “was the first time for many, many years that we were handed a ruling against us. We needed to discuss it internally, to see what would come after it.”
When other rulings against NAV’s practice were also handed down in the spring of 2018, “we should have contacted riksadvokaten (Norway’s state prosecutor).” Vågeng admitted. Neither she nor anyone else at NAV involved the prosecutor’s office until October of last year, at which point the scandal was complete and thousands of NAV clients had been wrongly denied benefits or punished. NAV’s political superiors at the ministry Hauglie heads were informed the year before, in the late autumn of 2018.
Vågeng was responding at least in part to strong criticism from the just-retired Director General of Public Prosecutions Tor-Aksel Busch. He’d been among the first to testify on Thursday, and made it clear that “if we’d been notified about this earlier, we would have investigated thoroughly already in 2017. I’m quite surprised we weren’t, I’m not going to hide that.”
Busch pointed out that 33 of the 75 NAV clients who were wrongly convicted of welfare fraud were convicted after 2017. At least they would have been spared the expense and agony of the wrongful prosecution, he noted. He, too, nonetheless took the opportunity to apologize for the injustice suffered by many Norwegian welfare recipients. His own public prosecutors at a lower level of the judicial system had also wrongly followed only Norwegian law without considering the ramifications of Norway’s agreement from 1994 to also follow EU regulations.
Former government ministers also grilled
Also testifying on Thursday were all labour and welfare ministers serving before Hauglie, also in the former left-center government that held power until 2013. Anniken Huitfeldt and Hanne Bjurstrøm of the opposition Labour Party had political control of NAV when it arguably ushered in the practice that followed new EU rules from 2012. Both, however, testified that the issue never landed on their desks, nor were they made aware of any prosecution or problems. Robert Eriksson of the Progress Party, who took over the labour and welfare ministry when Progress and the Conservatives first won government power in 2013, said much the same.
“It’s remarkable that the ministry’s bureaucrats didn’t understand that there was a political question at stake that should have been handled at the highest level,” wrote newspaper Dagsavisen’s commentator Arne Strand after the hearing’s first day. “The former government ministers’ testimony gives an impression of a politically lazy ministry.”
Hauglie was grilled on Friday as to why she didn’t think to notify Busch’s office either, and she accepted criticism on behalf of her ministry. She maintained, however, that she was not made aware of the seriousness of the situation, only that NAV intended to change its practice and finally allow benefits to be paid out even if recipients were physically present or residing in another EU country. Hauglie contended that she didn’t realize so many people had been wrongly denied benefits, prosecuted and convicted until last August.
“When a mistake has been made for so many years, it’s clear that the ministry isn’t pleased,” Hauglie testified. “I now see that more questions should have been asked at an earlier point in time.”
Points finger at NAV
She stressed that NAV bears “large responsibility,” adding that “we must ask ourselves how NAV didn’t recognize the mistake earlier.” She claimed NAV also had toned down the issue in early 2019, believing that it only had small economic or administrative consequences. “We didn’t have, at that time, any reason to believe that (welfare recipients) had been prosecuted or convicted,” Hauglie testified.
Norwegian Broadcasting (NRK) reported how members of the Parliament’s disciplinary committee conducting the hearing had wanted to know why Hauglie’s ministry didn’t raise more questions when first contacted by NAV in December 2018. Hauglie repeated that “we weren’t aware this involved any court cases or prison terms.” She also said her ministry had no further contact from NAV between March and August of last year, when NAV finally seemed to realize that its misinterpretation of EU law could have led to people being wrong prosecuted and convicted.
Asked why it took another two months until the NAV scandal finally was made public, on October 28, Hauglie said her ministry needed to decide whether NAV’s and the court’s practice since 2012 should be set aside. Even Norway’s Supreme Court had upheld NAV’s wrongful practice since EU law hadn’t been taken into account. Hauglie defended her ministry’s decision to “obtain an external quality check,” and then the result was stunning. “The worst thing with this case is that the same mistake was made so many times, so many places,” Hauglie testified.
Asked to comment on the human consequences of NAV’s malpractice, Hauglie said that “this entire case if deeply unfortunate and I have on behalf of the state begged pardon. The pure human aspects are deeply tragic.”
Prime Minister Erna Solberg, who has the highest level of responsibility for her government that includes Hauglie’s ministry, testified as well Friday afternoon.
“This is a case that that never should have happened,” Solberg told the parliamentary committee. “We will do what we can to hinder anything like it happening again.” She indicated her government still needed “to find out” why NAV’s malpractice wasn’t discovered much earlier, even years ago.” She pointed to attempts now to strengthen NAV, the welfare court and the state prosecutor’s office. More than NOK 7 million in benefits have already been paid out to victims of the scandal, with more cases yet to be resolved. All government ministries have been ordered to review whether EU rules are interpreted correctly.
“This case is an important test of how Norway can make things right in a good manner,” Solberg said, adding that she continued to have full confidence in Hauglie as her minister.
Since Solberg holds a majority in Parliament, it’s thus possible Hauglie will survive the NAV scandal, and NAV’s boss Vågeng as well. Even as opposition Members of Parliament from the Socialist Left and Reds parties were calling their roles “unforgiveable,” Vågeng and Hauglie were clearly resisting attempts to become scapegoats of the scandal. Commentator Strand wrote, meanwhile, that Vågeng “hasn’t done her job” and that “NAV needs new leadership.”
One lawyer called the entire hearing round “pointless,” along with a looming government investigation into the scandal. “It doesn’t matter what the opposition (in Parliament) comes up with,” argued Olav Lægreid of Advisio Advokat. He told Dagsavisen that only a majority government can decide how long ministers or top bureaucrats hold their jobs. NAV itself, he added, must address and rectify its own scandal, along with the lawyers who’ll now be advising it. He also thinks many more NAV clients have been affected over the years than the roughly 2,400 NAV has identified so far.
While some think Hauglie and Vågeng must ultimately be replaced, if only to “do something” to restore public confidence, there are other lessons at stake. “The NAV scandal shows that the legal system and the welfare system that we all regard so highly, hasn’t been as democratic and legal as we thought,” MP Magne Rommetveit of the Labour Party told newspaper Klassekampen. “That’s sad for all of us.”