Labour market and integration reforms – Budget Bill for 2024

Published

In connection with the Government’s Budget Bill for 2024, several reforms concerning the labour market, integration and efforts to combat social exclusion were proposed. The proposals are based on an agreement between the Government and the Sweden Democrats. The Government presented the autumn budget to the Riksdag on 20 September.

A more effective Arbetsförmedling

Arbetsförmedlingen (Swedish Public Employment Service) must be more effective, with a clear focus on its core activities. Arbetsförmedlingen’s management resources must be used more effectively when it comes to assessing and planning support and measures for jobseekers, control of unemployed people’s job search activities and support to employer’s recruitment efforts. In light of the economic slowdown, there is also a need to improve Arbetsförmedlingen’s prospects to manage greater unemployment and to raise the quality of the Service’s control efforts. The Government therefore proposes an increase of the Arbetsförmedlingen’s administrative appropriation by SEK 200 million in 2024.

Labour market entry agreements for long-term unemployed and new arrivals

Labour market entry agreements are a new form of subsidised employment that aims to increase opportunities for new arrivals and the long-term unemployed to establish themselves in the labour market and to facilitate skills supply to businesses. In November 2022, the Swedish Trade Union Confederation, the trade union Unionen and the Confederation of Swedish Enterprise signed an agreement on labour market entry agreements. This agreement differs somewhat from the regulations previously adopted. This has resulted in work being done at the Government Offices to allow necessary changes, including analyses of state aid regulations. The Government is now ensuring that labour market entry agreements are put into place. The Government’s aim is for the regulatory changes to enter into force early in 2024. 

Reduced volumes in matching services and introductory jobs

The Government proposes reducing funds to labour market policy programmes and initiatives, including through fewer introductory jobs. This means a net reduction in expenditure of SEK 2.1 billion in 2024 in relation to the estimated level of appropriations in the Budget Bill for 2023. The Government considers that the reduction in funds also means fewer participants primarily in the matching services that Arbetsförmedlingen purchases from suppliers, while there is scope to increase the number of participants in other initiatives, such as internships. 

Better knowledge of effective labour market policy

To ensure the efficient use of government funds, it is important to have a thorough knowledge base concerning the effectiveness of various initiatives. The Government therefore also proposes increasing the administrative appropriation to the Institute for Evaluation of Labour Market and Education Policy (IFAU) by SEK 3 million in 2024. In the following years, the increase is expected to amount to SEK 5 million in 2025 and SEK 7 million per year from 2026.

An income-based unemployment insurance fund should be introduced

Unemployment insurance must be more fit for purpose and better able to contribute to transition in the event of unemployment. The Government therefore intends to propose a reform of unemployment insurance so that it is based on income from employment rather than on the length of time employed. This will provide regulations that are easier to administer, which may lead to shorter waiting times for payments. Opportunities to combat fraud and error will also be improved, and the work-first principle will be strengthened. To enable the necessary preparations ahead of the reform, the Government is setting aside SEK 50 million in 2024 to Sweden’s unemployment insurance funds.

Better financial conditions for Samhall and review of its assignment

Achieving better conditions for people with disabilities that entail a reduced work capacity is an important part of a more effective labour market policy. In this, Samhall serves a vital function. At the same time, Samhall faces financial challenges, partly as a result of increased wage costs combined with reduced demand for the company’s services. To create better financial conditions for Samhall’s activities, the Government intends to increase the central government compensation for additional costs to Samhall by SEK 988 million per year. The Government also plans to conduct a thorough review of Samhall’s assignment, activities and conditions.

Strengthening of early measures for asylum seekers

Early measures for asylum seekers and others is important to make the path to work and self-sufficiency easier, not least for people with temporary protection under the Temporary Protection Directive. The Government proposes increasing the funds for early measures for asylum seekers and others. The proposal would increase the appropriation by SEK 20 million in 2024 and an estimated SEK 10 million more in 2025. The measures will help to promote participation, good health and facilitate the path to a job, and may deal with matters such as language training, networking and knowledge of the Swedish society. 

Phase-out of the state subsidy to ethnically based organisations

Public funds set aside for integration measures must be used more efficiently and have a clearer integration objective. In light of this, the Government proposes phasing out the special support to ethnically based organisations. This means that the SEK 18.9 million per year set aside for the state subsidy will be redistributed as of 2024. Besides the special conditions that apply to the five national minorities, the Government sees no reason why funds should be allocated to organisations based on their member’s ethnicity.

Continued investment in location data

Having access to location data in statistical tools plays a key role in the work against social exclusion. Access to statistical tools with location data contributes to a more effective use of resources, as it provides data for analyses, follow-up and evaluation, and the opportunity to target measures against exclusion where the benefit is the greatest. To allow the continuation of the assignment aimed at ensuring the availability of location data tools, the Government intends to invest SEK 7 million in 2024 and SEK 12 million per year from 2025. The Government also intends to task the National Board of Housing, Building and Planning with continuing to provide and develop existing location data tools. In addition, the Board is to provide support to and coordinate relevant government agencies, regions, municipalities and other societal actors in the use of location data.

Mandate to government agencies aimed at improving conditions in areas of social exclusion

The Government proposes setting aside SEK 6 million per year from 2024 for mandates to strategic agencies in efforts against social exclusion. Several government agencies can develop their activities to be able to better help improve conditions in areas of social exclusion. Access to statistical tools with location data provides data for analyses, follow-up and evaluation, and the opportunity to target measures against exclusion where the benefit is the greatest. In this context, agencies such as Arbetsförmedlingen, the National Agency for Education and the Swedish Police Authority are particularly relevant, as is the National Board of Health and Welfare. 

Preventive measures against gang crime

Preventive measures are an important part of society’s overall initiatives against crime and insecurity. In this, municipalities play an important role, not least in the work to prevent and deter children and young people from turning to crime. The Government proposes a three-year investment in preventive measures against gang crime. SEK 80 million will be set aside for 2024, and an estimated SEK 150 million for 2025 and 2026. The investment will be made in the form of government grants to the municipalities, with special focus on areas with widespread exclusion. The National Board of Health and Welfare will be tasked with distributing the funds. The Government will provide more details about this assignment at a later date.