Christina Lugnet

Lugnet booted from Economic Growth Agency

Christina Lugnet, director general of the Swedish Agency for Economic and Regional Growth (Tillväxtverket), has been fired, following revelations in the newspaper Dagens Nyheter that the agency was treating employees to lavish dinners at fancy restaurants.

In a mail to news agency TT, Lugnet wrote via the agency's head of communications, "As director general, I have ultimate responsibility and accept the government's decision."

In a statement issued by the Ministry of Finance Monday, Finance Minister Annie Lööf said that in order for the agency to continue to develop and do a good job it needs "the full support and faith of business and industry, citizens as well as the government".

From the opposition's side, the spokesperson for the center-left Social Democrats' business policy, Jennie Nilsson, told news agency TT, "It wasn't all that remarkable that she's getting dismissed, considering all the turbulence recently."

Towards the end of July, Dagens Nyheter revealed that Tillväxtverket repeatedly broke the rules for work-related meals and entertainment.

The investigation showed that since 2010 Tillväxtverket had spent more than US$ 1 million on internal seminars and entertainment and an additional US$ 1.5 million on seminars and conferences for employees. Usually these events were combined with expensive dinners at fancy restaurants, sometimes hosted at castles or spas.

Taxpayers have been footing the bill for wine and chocolate tastings and a ride on a RIB boat in the Stockholm archipelago.

The agency has accounted for the dinners and events as seminars, not representation. Hence, they have paid a lower VAT, which is in the gray zone of what is allowed, according to a lawyer with the Swedish Tax Authority.

Boel Andersson-Gäre, a professor in leadership at the university Högskolan i Jönköping, however, told news agency TT that firing the head of the Agency will not get to the root of the problem.

"If you don't get to the bottom of the problem, it won't be enough to change out the leadership. The culture is created through interaction between the boss and the employees," she says.

Lugnet, 58, was appointed to lead the new agency on April 1, 2009. She lives in Haparanda and commutes to Stockholm.

Lugnet will be assigned to a position in the Government Offices as she has three years left in her appointment.

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