Union Leader Allays Strike Fears

ASÍ President Finnbjörn A. Hermannsson

Strikes are an unlikely outcome in the current labour dispute between unions and employers, President of the Icelandic Confederation of Labour (ASÍ) Finnbjörn A. Hermannsson told RÚV today. He expects parties to reconvene for further discussions, as the sides are close to agreement on major issues.

Strikes up to individual unions

On Friday, the coalition of unions ended its negotiations with the Confederation of Icelandic Enterprise (SA) on a new collective bargaining agreement. Despite an agreement on modest salary increases being reached in principle, the coalition had hoped to include a clause in the four-year deal to protect workers from downside risks if inflation and interest rate targets were not met.

Finnbjörn says that although the unions involved are members of ASÍ, an umbrella organisation of trade unions, the unions would have to individually decide whether to strike or not. Ragnar Þór Ingólfsson, president of the union VR, had previously said that he did not rule out industrial action to bring about a new agreement.

“The members of the coalition will confere and what they do will be their decision,” Finnbjörn said. “But I expect people to come back to the table and pick up from where they left off.”

Further negotiations upcoming

Finnbjörn added that both parties were focused on bringing down inflation and that an agreement on salaries was near at hand. “And usually when talks fall apart, it is because of the salary issue, not clauses on economic targets. That’s why I expect the parties to come back together and exhaust all avenues before they turn to industrial action,” Finnbjörn said.

Further wage negotiations are coming up for unions in the public sector. Finnbjörn said that informal discussions have begun and that he was optimistic for a good result and positive economic developments in the near future.

Arts University Abolishes Tuition Fees

Áslaug Arna Sigurbjörnsdóttir minister of justice

The Iceland University of the Arts is dropping tuition fees, starting fall semester 2024. The university’s management made this decision following today’s announcement by Minister of Higher Education, Science and Innovation Áslaug Arna Sigurbjörnsdóttir that independent universities will be offered full state funding if they abolish tuition fees, Vísir reports.

Three independent universities eligible

The University of the Arts is the first of the three qualifying universities to accept the offer. The other two independent universities are Reykjavík University and Bifröst University. According to a press release from Áslaug’s ministry, these universities have received 60 to 80% of the funding they would’ve received if they were public universities. To bridge this gap, the universities have charged students tuition fees of up to ISK 2 Million [$14,500, €13,500].

“In the spirit of funding being attached to each student, the universities can now do away with tuition fees and receive full public funding,” Áslaug said. “I think it’s fair that students have equal opportunity to study, regardless of the operational form of each university, and that those who choose to study at an independent university stand equal to those who study in the public universities. The state should not discriminate between students.”

A more diverse student body

In a press release today, the Iceland University of the Arts Rector Kristín Eysteinsdóttir celebrates the minister’s decision as the university has long wanted to do away with tuition fees. When the change comes into effect this fall, students will only have to pay a lower registration fee like in other public universities.

“This is a big moment for the university and the most important issue for equal access of students to higher arts education in this country,” Kristín said. “This will lead to more economic equality regarding access to arts education, which is something to celebrate. We expect that the decision will lead to an even more diverse group of applicants, and students as a result, in the coming years.”

Reykjanes Avoids Frost Damage

reykjanes eruption at sundhnúk february 2024

Very little or no frost damage seems to have occurred in Reykjanes peninsula buildings after lava from the February 8 volcanic eruption damaged a hot water pipeline. Both homes and industrial properties were without water for days while work on a new pipeline took place.

According to an Mbl.is inquiry, no reports of frost damage were sent to the distribution company HS Veitur, to the Natural catastrophe insurance of Iceland, or to insurance companies TM, Sjóvá or VÍS. No frost damage occurred at any institutions of the Reykjanesbær municipality.

A concerted effort

Páll Erland, director of HS Veitur, said that even though assistance was requested in multiple houses, no frost damage has been reported. He told Mbl.is that this could be considered a miracle, especially after days of no hot water available for heating. He said that some damage could come to light later on, especially now that hot water is being returned to the system. “This looks very good, however, as it stands today,” Páll said.

Páll added that success during this challenging time is owed to Reykjanes residents who obeyed electricity use guidelines during the hot water outage. The Department of Civil Protection and Emergency Management has dispatched a team of plumbers over the last few days to help HS Veitur secure hot water flow to Reykjanes buildings. Tanker trucks were also sent from neighbouring Hafnarfjörður, delivering 1,800 tonnes of hot water to the area.

Insurance cases avoided

Frost damage due to a lack of hot water falls through the cracks of both traditional insurance and natural catastrophe insurance. It was therefore important for residents of Reykjanes to avoid frost damage after the hot water pipeline was damaged by lava flow.

Government to Buy Grindavík Homes


The Icelandic government is offering to buy all residential housing owned by individuals in Grindavík and take over the mortgages on the properties. The cost is estimated to be ISK 61 Billion [$443 Million, €411 Million], according to a press release from the ministries in charge of the programme.

The January 14 volcanic eruption near Grindavík destroyed three houses, caused crevasses to form across town, and displaced the 3,800 inhabitants for the foreseeable future. The town had already been evacuated once before, on November 10 last year, due to seismic activity. The latest eruption on February 8 damaged a hot water pipeline, cutting off heating for Reykjanes homes.

Bill introduced this week

During a meeting of the cabinet of ministers Friday, a bill on the purchase was agreed upon. It was put into an online consultation process and will be introduced in Alþingi, Iceland’s parliament this week. Over 300 comments on the bill’s contents have already been submitted. The government has conferred with opposition party parliamentarians and introduced the bill to the municipal government of Grindavík.

A real estate company, Þórkatla, will be established to handle the purchase and management of the properties, which it will purchase for 95% of their official fire insurance value, with the relevant mortgages deducted. The company will be financed by the treasury and with loans from financial institutions. The state is expected to receive reimbursements from the Natural catastrophe insurance of Iceland for any properties rendered uninhabitable.

Grindavík residents will have until July 1 to apply to enter the programme and have their homes bought.