Norwegian welfare agency NAV, along with the Norwegian government, have been utterly blasted by the European Free Trade Association (EFTA) court. In a devastating ruling issued this week, EFTA judges confirmed that NAV had, for 25 years, illegally cut welfare payments to recipients who’d traveled to another EFTA member country while collecting benefits.
It’s another humiliating blow to NAV, which had thought it was following Norwegian government policy by disallowing welfare payments if a recipient was out of the country. The theory was that recipients of unemployment benefits should be home looking for work, not off traveling.
That line of Norwegian thinking led to the illegal suspension of benefits, demands for reimbursement and even criminal prosecution of more than 5,000 Norwegians just since 2012. The EFTA court has ruled that the practice long carried out by NAV and its forerunners has always violated EU and EFTA rules, stretching all the way back to 1994 when Norway became an EFTA member after turning down membership in the EU itself.
The EFTA membership, however, left Norway obliged to abide by EU/European Economic Area rules and regulations in order to gain and retain access to the EU’s inner market. Norway also must honour the EU/EEA’s policy of free flow of people, goods and services within the EU, and that’s why Norwegians can indeed travel abroad even while collecting NAV benefits.
Thousands more may have been wronged
NAV’s refusal to allow Norwegian residents to travel outside Norway while receiving benefits also violated EFTA rules prior to 2012, when Norway ushered in a new welfare law. That means thousands more people may have had their unemployment benefits wrongly cut, ordered to repay benefits or even charged with welfare fraud. Many were wrongly prosecuted and even jailed.
“This (the EFTA ruling) is a pure slaughter of Norwegian authorities,” Rune Halseth told newspaper Dagsavisen in Thursday. “We are relieved and quite proud.” He’s among those who were prosecuted and sentenced (four months in prison in his case) for welfare fraud, because he’d traveled to another European country while receiving benefits. He and Marianne Evensen, who also was wrongly convicted of welfare fraud, now lead an organization aimed at helping other victims of what’s been called one of Norway’s biggest scandals ever.
They now firmly believe that NAV needs to dig up and make right all the cases it may have wrongly prosecuted prior to 1994, to make sure justice is served. So does defense attorney John Christian Elden, who represents one victim of the NAV scandal whose case is being examined by Norway’s Supreme Court. Elden has claimed all along that EU/EEA/EFTA rules have been consistent all along.
‘Won on all counts’
“As far as I can see, we won on all counts in this (the EFTA ruling),” Elden told Dagsavisen. That means all cases since 1994 need to be reviewed and rectified.
Both the government minister and the NAV boss at the time the scandal broke have since been replaced. Labour Minister Tørbjørn Røe Isaksen of the Conservative Party isn’t in any hurry to order NAV to review all post-1994 cases. He intends to wait until after Norway’s highest court has handled the case and made its own determination. It’s widely believed, however, that the Norwegian court will go along with the EFTA court. It had even asked for EFTA’s legal review of the matter.
It remains unclear when the high court will hear the case. It may be after the September election, when Isaksen may no longer be Labour Minister either. It’s expected to cost NAV at least NOK 250 million to reimburse and cancel debt of those wrongly prosecuted. Compensation claims are also expected.