Spring budget injects billions for migration costs

2:16 min

The center-left government's supplementary spring budget will dole out billions to Swedish police and local authorities to buffet last year's record number of asylum seekers.

At a Wednesday morning press conference, Finance Minister Magdalena Andersson said the Swedish economy would remain healthy under the coming years and will eventually benefit from the some 163,000 people who sought asylum last year.

Andersson said tax revenues would increase by nearly 6 percent this year and the nation's gross domestic product would remain high at 3.8 percent. The government also signaled that unemployment levels would shrink this year and next, though that trend was expected to reverse in 2018.

Despite the rosy picture, Sweden's budget deficit will remain until it's projected to be paid off by 2019. Andersson told Radio Sweden the deficit was a holdover from the previous government, as well as the large price tag for last year's immigration influx.

Spending on immigration will also make up a large portion of Sweden's coming budgets. Andersson said its cost is expected to more than double this year and that the government will pay an estimated SEK 72 billion in 2020 for work with migration and integration.

Andersson added that more needs to be done to get recently arrived migrants into the Swedish job market.

"Unfortunately, it takes too much time right now," Andersson told Radio Sweden. "Therefore, we are also putting extra resources in to evaluate the education for people that are coming to Sweden and different measures to make it quicker and easier to get into the Swedish labor market."

The supplementary budget has extra funding for Swedish-language courses for immigrants, for the reception of unaccompanied minors, as well as a fast track program for newly-arrived entrepreneurs.

The ruling coalition of Social Democrats and Greens is also tinkering with the budget by proposing several tax credits with an environmental tinge. 

Taxes will be lowered on biofuels and the value-added tax on minor repair work on bicycles, shoes, leather goods, clothing and household textiles will be lowered from 25 percent to 12 percent. It is also predicted the bill will offer a tax credit on labor costs for repairing and maintaining home appliances.

Andersson told Radio Sweden she is not worried that those measures will reduce consumption and drive down economic growth. "Repairing things is rather labor intensive so that's also a way you can reduce unemployment," she said.