Bright spots in the fall budget - despite a chilly Swedish economy
On September 20, the Government's budget proposal was submitted to Parliament. After weeks of constant budget news, it was welcome to learn about the government's overall direction. For the tech industry, there were several long-awaited and welcome initiatives that TechSverige has worked for, including those linked to skills supply, connectivity and a digital infrastructure for healthcare.
At the same time, the government noted that Sweden is not achieving the overall objectives of its digitalization policy. Other countries are more successful in using the opportunities of digitization despite having lower digital skills and broadband expansion.
The government intends to develop a digitization strategy that will develop policy in areas such as public administration and connectivity. It is positive that the Government has clearly identified the problem of Sweden losing ground in comparison with other countries and is starting work on a new digitalization strategy.
- "Taking advantage of the opportunities offered by digitalization is central to our competitiveness, efficient public services and the green transition. Here, the government needs to present concrete measures in the future," says Christina Ramm-Ericson, head of industrial policy at TechSverige.
The next step is also taken in the proposal from the Tidö Agreement regarding the digital infrastructure in health care and funds are allocated. Sweden's perhaps largest soft infrastructure project needs resources and now it is important that this investment benefits business development and promotes innovation.
In the area of skills, important investments are being made in, for example, engineering education in universities and universities of applied sciences.
- A step in the right direction to meet the skills needs of the tech industry," says Christina Ramm-Ericson.
TechSverige welcomes the government's initiative to establish a research and innovation program to promote 6G development and increased connectivity, but does not believe that this should be done by sharply reducing funding to Vinnova.
- "It is worrying that the government is planning to significantly reduce Vinnova's budget at a time when there is a great need to increase investment in research and innovation in Sweden in order for us to be able to gear up and compete in the global market," says Christina Ramm-Ericson.
Cyber attacks and cyber espionage are a growing security challenge for Sweden and require increased competence in information and cyber security. TechSverige welcomes Cybercampus Sweden at KTH, which will be established to strengthen both the supply of skills and research in cybersecurity and increased funding for MSB to develop operational cyber capabilities in civil defense.
The Prime Minister's AI Commission , which was mentioned in the government declaration with the task of providing guidance on how to both take advantage of the great opportunities and manage various risks, is not mentioned in the budget. TechSverige hopes that it can contribute to a broader view of the possibilities of AI and sees the need to focus on business collaboration and that concrete measures are developed.
The budget contained a simplification package of SEK 50 million to make life easier for businesses, and TechSverige has a clear hope that current legislation adopted, both at EU and national level, will be based on the "Think small first" principle. The government has also announced that the time limit for the so-called expert tax will be extended from the current five to seven years and that the 3:12 inquiry will be given an additional assignment to review the rules on qualified employee stock options so that the rules become more effective.
- Good conditions for companies to build knowledge and conduct their business are a prerequisite for Swedish competitiveness and sustainable social development," says Christina Ramm-Ericson.
The Minister of Finance was pressed hard on the climate issue during the press conference and referred to the upcoming climate policy action plan to be presented in November. TechSverige would have liked to see a clearer link between digitalization and sustainable development in the budget, but hopes for clearer measures in the action plan.
In summary, the government is presenting yet another cautious budget with the fight against inflation at the top of the agenda. Given low growth and structural challenges such as an ageing population and skills shortages, TechSverige would have liked a more aggressive fiscal policy that takes advantage of the opportunities of digitization. Although the budget lacks a comprehensive approach to digitization, there are a number of bright spots and announcements about direction. This now needs to be translated into concrete reforms and the pace needs to be increased. A term of office goes fast!
Read TechSverige's longer commentary on the budget:
https://techsverige.se/2023/09/framsteg-och-utmaningar-i-en-kylig-svensk-ekonomi