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Tuesday, May 28, 2024

Severance pay stirs up a new storm

Critics are questioning how top Norwegian politicians can claim lucrative severance pay when they leave office, leading to suspicions of greed at taxpayer expense. Calls are even going out for the resignation of Norway’s new fisheries minister, after he applied for (and received) severance pay for a former mayor’s post in Northern Norway even when he already had a new job in Oslo.

Norway’s recent fisheries ministers are all being questioned over their taxpayer-financed severance pay. At left, new Fisheries- and Seafood Minister Geir Inge Sivertsen taking over from Harald Tom Nesvik, whose Progress Party withdrew from the government. Norway’s fishng industry is second only to oil in terms of the revenues and jobs it creates. PHOTO: NFD

The Progress Party’s withdrawal from the government in January has set off a new wave of severance pay applications from politicians who suddenly lost their jobs. State government politicians are all offered one month’s extra pay when they leave office (around NOK 117,000 in the case of government ministers), but they can apply to receive three months of their pay if they don’t have a new job lined up. They can receive up to six months of severance pay if they’re placed in quarantine and aren’t allowed to work anywhere else until the quarantine period is over.

Among those currently seeking severance pay for three months, even in cases where their party voluntarily withdrew from government service, are seven state secretaries (all of whom earn NOK 994,400 a year), two political advisers and Progress’ former fisheries minister, Harald Tom Nesvik. All told, they’re claiming NOK 2.7 million in taxpayer compensation. Nesvik alone earned NOK 1.41 million (USD 152,000) a year as a government minister and even joked that he needed a new job when he was replaced by the Conservatives’ Geir Inge Sivertsen.

Net closing around new fisheries minister
It’s Sivertsen, though, who currently is drawing the most criticism. He has confirmed that he applied for and accepted severance pay at the local level, when he moved from being mayor of Lenvik to become a state secretary for the Conservatives-led government in Oslo. Newspaper Dagbladet reported that he was paid NOK 120,000 for the months of November and December last year, even though he began pulling his state secretary’s salary in early November as well.

Sivertsen claims he was holding down two full jobs, since his mayor’s post ran until the end of the year when Lenvik merged with Senja. He was also vice-mayor of Senja and sat in the county council, too. He ended up with double pay, which he seems to think he deserved since he had two “if not four” jobs. He had told local officials, however, that he wouldn’t “fully” begin as a state secretary until January, even though he held the title and responsibility.

New Fisheries- and Seafood Minister Geir Inge Sivertsen has been back in Northern Norway, “cleaning up” and paying back unwarranted duplicate income. PHOTO: NFD

Senja has now demanded repayment from Sivertsen, who has complied. “He applied for severance pay that he shouldn’t have received,” Senja administrator Hogne Eidissen, told news bureau NTB. Newspaper Dagens Næringsliv (DN) also reported that Sivertsen hung on to several board seats in various organizations and received a fee of NOK 20,000 for one of them, after he became a state secretary. He didn’t resign from the posts until DN had started asking questions about them.

Prime Minister Erna Solberg, faced with tough criticism in Parliament, has ordered Sivertsen to “clean up” in his various business and local government affairs and claims he’s doing that now. That hasn’t satisfied MPs like Terje Aasland of the Labour Party, who thinks Sivertsen “has shown a greediness that usually is condemned” in Norway. “A government minister should have this moral perspective in order,” Aasland told Norwegian Broacasting (NRK).

MP Bjørnar Moxnes of the Reds agrees, noting that “Geir Inge Sivertsen must have worked hard to secure himself both severance pay and double pay,” Moxnes said. Newspapers Aftenposten and VG have reported that in addition to his salary as a state secretary and now minister, he received not only the NOK 120,000 in mayoral severance and NOK 20,000 for a board position but also more than NOK 52,000 from October through February as an elected represented to the county council for Troms og Finnmark. Moxnes notes there would be no mercy for a welfare client who “swindled” taxpayers for more than NOK 100,000. “That would lead to jail time,” Moxnes told newspaper Aftenposten.

‘Whole case stinks’
He’s among those who have lost confidence in the new fisheries minister, after less than a month on the job during which much time has been spent “cleaning up” his affairs. Aasland said he thinks it’s “amazing” that Solberg still has confidence in him, while Moxnes thinks Solberg “must ask the fisheries minister to resign.” Kari Elisabeth Kaski of the Socialist Left party (SV) thinks “the whole case stinks.”

As of Tuesday afternoon, Solberg claimed she still had “full confidence” in her new fisheries minister. “You can make mistakes, clean up and others can use all the adjectives they want,” she told NRK. “Do I think he’s a good fisheries minister for Norway? Yes, I think he is a good fisheries minister.” Sivertsen wrote in an email to NRK on Monday that “I’m back home in Senja to clean up. I have today paid back what I was paid from Senja in severance krone for krone. I have also annulled the severance pay agreement. I have also spoken with the county and asked to pay back all the fees I have received since January 1. I have applied for leave from the county council and it will be handled in March.” He still insists that he had “the right and duty” to finish his term as mayor of Lenvik.

The severance pay issue has exploded during Solberg’s eight years as leader of Norway’s government coalition, because of all the parties involved and recent high ministerial turnover. Aftenposten reported last week that since her coalition won government power in 2013, severance payments had exceeded NOK 20 million before the current round of applications.

It’s not a new problem, though, with similar severance (called etterlønn in Norwegian) conflicts also occurring during the last Labour-led government.   Aftenposten has reported how many former government politicians on both the right- and left sides of Norwegian politics have set up their own consulting companies based on their knowledge of government affairs. That can lead to conflicts of interest and thus trigger quarantine periods, which then also allows the former politicians to demand up to six months of severance pay.

Former fisheries minister Per Sandberg, pictured here during an official trip to China, received six months of severance pay in compensation for the same amount of quarantine, because he’d started a consulting company that aimed to promote seafood exports to Asia and elsewhere. PHOTO: NFD

In the case of yet another former fisheries minister, the Progress Party’s Per Sandberg, he immediately set up a consulting company tied to, among other things, seafood export and import, meaning that he then faced quarantine and could claim up to six months of his ministerial pay. Sandberg later dissolved his consulting company, which hadn’t earned anything. Sandberg could claim he hadn’t done anything wrong, arguing that the quarantine period banned him from working.

The Parliament also offers severance pay packages as do local governments, and questions are rising over whether they’re also being abused.  In one recent case, a former Progress Party MP convicted of defrauding the Parliament, Mazyar Keshvari, actually sought severance pay himself when Progress leader Siv Jensen returned to her seat in Parliament that Keshvari had filled while she served as finance minister. The Parliament’s leadership turned down Keshvari’s application.

The overall system has been criticized before, also during the former Labour Party government when Sandberg himself, then in opposition, told newspaper VG in 2014 that “it seems as though these politicians have found weaknesses in a system and systematically exploit them.” That in turn can threaten voter confidence.

Aftenposten editorialized earlier this month that the “ministerial pay festival must be stopped.” While opposition politicians like Moxnes are claiming that some former politicians behave worse than anyone receivng welfare benefits, Aftenposten wrote that “it’s both serious and sad … if our elected officials abuse (the severance pay system).” The newspaper called for sharper rules around severance pay.

Solberg’s new minister in charge of local governments and modernization, Nikolai Astrup, is now signaling exactly that. “We’re going to appoint a commission to evaluate the quarantine law” following “a string of problems that we think should be drafted by the commission.” The commission will also examine whether politicians who set up consulting companies regarding issues they dealt with as minister should be compensated for quarantine periods. Berglund



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