Government Releases Statement on Stability Pact Skip to content

Government Releases Statement on Stability Pact

Prime Minister Jóhanna Sigurdardóttir and Finance Minister Steingrímur J. Sigfússon released a statement yesterday on the progress of the stability pact with the Confederation of Icelandic Employers (SA) and Confederation of Labor (ASÍ).

Prime Minister of Iceland Jóhanna Sigurdardóttir. Photo by Geir Ólafsson.

In the statement they announce their plans to review the proposed energy tax, which has raised considerable controversy in society, Fréttabladid reports.

However, Sigurdardóttir stated the idea will not be abolished entirely; the plan is to reach an extensive agreement on revenue for the state treasury and estimate its impact on people and companies.

President of ASÍ Gylfi Arnbjörnsson told Fréttabladid that the government’s statement on the energy tax had almost caused their wage contracts with SA to be terminated. Sigfússon had agreed on Tuesday to discuss the possibility to entirely abolish the energy tax, Arnbjörnsson said, which is one of the reasons the wage contracts were extended.

The idea had been for the employment market to secure the ISK 16 billion (USD 127 million, EUR 80 million), which the energy tax was supposed to deliver, for the state treasury instead through an employment insurance fee.

Arnbjörnsson said ASÍ finds the government’s statement on the progress of the stability pact entirely unacceptable.

The statement also reads that investments on the employment market will be enabled and the solving of matters related to certain large-scale operations expedited.

When asked whether that means that all hindrances for the Helguvík aluminum smelter will be pushed out of the way, Sigurdardóttir said she hoped that solutions regarding the smelter will be found.

Minister of the Environment Svandís Svavarsdóttir recently made a controversial move in ordering a joint environmental impact assessment for all smelter-related operations in Helguvík when her predecessor had decided otherwise.

Click here to read more about that story and here to read more about the proposed energy tax.

Click here to read more about the wage contract being extended.

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