Mayor Proposes Closing Reykjavík Municipal Archive for Budgetary Reasons

Reykjavík Mayor Dagur B. Eggertsson has proposed that the Reykjavík Municipal Archive be shut down for budgetary reasons, RÚV reports. Per the proposal, the archive’s primary functions would be assumed by the National Archive and the dissemination of, and educational outreach related to the archive’s holdings would become the responsibility of the Reykjavík City Museum. If the proposal is approved by the city council, Reykjavík would be the first municipality in the country to close a district archive, and perhaps the only European capital not to maintain its own archive.

The Reykjavík Municipal Archive was founded in 1954. It stores over 10,500 shelf metres of documents and has also increased its digital holdings and services in recent years.

Under Icelandic law, municipalities are permitted, but not required, to operate a district archive. Iceland’s National Archives already oversees archival duties for municipalities that do not maintain their own archives. The mayor’s proposal suggests that the capital simply follow suit, as costs of effectively maintaining an archive are only expected to increase in order to keep pace with the demands of record keeping in the digital era.

In 2022, it cost the City of Reykjavík over ISK 170 million [$1.18 million; €1.10 million] to operate its Municipal Archive. It is expected to cost an additional ISK 10 million [$69,587; €64,910] to operate the archive in 2023. According to archivist Svanhildur Bogadóttir, however, the actual cost to run the archive is relatively low; a third of their budget goes towards the rent they pay the City of Reykjavík.

Reykjavík Archive does not have resources to fulfil its mandate, says private audit

The mayor’s proposal comes in the wake of an assessment conducted by auditing and accounting firm KPMG, which states that based on current funding, the Reykjavík Municipal Archive does not have the resources to fulfil its mandate. KPMG’s assessment suggests that beyond the basic savings associated with greater cooperation between the Municipal and National Archives, this arrangement would also lend itself to a number of additional benefits: better facilities, better use of staff expertise, and improved services.

Although they were aware that KPMG was conducting an assessment related to “strategic planning” for the Municipal Archive, none of the employees had any idea that there was talk of closing their place of work all together before the mayor submitted his proposal. One plan that had been on the table was for the Municipal and National Archives to be relocated to the same building, but in that scenario, they were intended to remain separate entities.

The mayor’s proposal does not outline will happen to the Municipal Archive’s staff—nine full-time and two temporary employees—in the event that the archive is closed.

Reykjavík City Council Approves Extensive Budgetary Measures

City of Reykjavík strike

At a meeting yesterday, Reykjavík City Council approved measures intended to save over ISK 1 billion in operational costs over the coming year, RÚV reports. Among the measures are the expansion of paid-parking zones and decreased subsidies for electric-vehicle charging stations located by apartment buildings.

92 budgetary items

At a City Council meeting yesterday, the majority submitted an amendment to Reykjavík’s 2023 budget. The amendment comprises a total of 92 items, which are expected to save over ISK 1 billion ($7.1 million / €6.7 million) over the coming year.

As noted in the meeting’s minutes, City Council deems that the measures reflect “sensible financial management,” noting that the pandemic has impacted municipalities all over the country. “The reaction is natural and befitting the occasion, serving to protect front-line services and vulnerable groups.”

Among the measures are amendments to meal purchases for preschools; reduced opening hours for youth centres (which will close at 9.45 PM as opposed to 10 PM), museums, and swimming pools (during holidays); expansion of paid parking zones; and decreased subsidies for electric-vehicle charging stations near apartment buildings; among other things.

In an interview with RÚV on Wednesday, Einar Þorsteinsson, Chair of City Council, stated that the residents would “feel these changes.” These budgetary cuts were not fun but necessary in order to improve Reykjavík’s finances.

Operational losses of over ISK 11 billion

During its meeting yesterday, the City Council also reviewed an interim financial statement for the city’s operations during the first nine months of the year. The statement revealed that the city’s “A Section” – primarily funded by taxpayer money – was operated at an ISK 11.1 billion ($7.1 million / €6.7 million) deficit.

In a press release published yesterday, City Council stated that numerous factors had impacted its finances: “A new variant of COVID-19 at the beginning of the year put temporary pressure on operations, especially on the school and welfare system. The war in Ukraine, in addition to the pandemic, led to a shortage of raw goods and slowed down production time, which has negatively impacted global markets and led to increased inflation among our trading partners. The Central Bank, owing to rising real-estate prices, high inflation, and overheating of the domestic economy, raised key interest rates; all of this has had an impact.”

As noted in a press release on the City’s interim financial statement, however, the City’s A and B sections – the “B” section includes businesses in part or whole ownership of the city, such as Reykjavík Energy (OR), Associated Icelandic Ports (Faxaflóahafnir), Sopra bs. and Strætó bs., among others – produced a surplus of ISK 6.8 billion ($48 million / €46 million).

This article was updated at 11 AM.

Cuts to Iceland’s Healthcare and Journalism “Dangerous” During Pandemic

Iceland National Hospital COVID-19

While Iceland’s government has increased investment in some areas to combat the economic effects of the COVID-19 pandemic, some of its key institutions are facing cuts. These include the National University Hospital and national broadcaster RÚV. Cuts at both institutions have been criticised as “dangerous” by MPs and interest groups. RÚV reported first.

Hospital Cuts to Affect Service

RÚV reported last week that next year’s government budget demands the National University Hospital cut costs by ISK 4.3 billion ($31.7 million/€26.7 million). The hospital has operated at a loss over the last several years, and has a cumulative deficit of ISK 3.8 billion ($28 million/€23.6 million). The hospital’s administration has requested that the cuts be spread over a three-year period, but that would still require the institution to cut operating costs by ISK 1.4 billion ($10.3 million/€8.7 million) next year.

MP Logi Einarsson, who is chairman of the Social Democratic Alliance, expressed his opposition to cuts to the hospital, saying “it is dangerous to impose strict austerity and streamlining demands on healthcare in the middle of a pandemic and the Parliament needs to change this.” According to Logi, the cuts would make it difficult for the National University Hospital to fulfil its role as the country’s main hospital and to cut down existing waiting lists for surgeries and other procedures.

A subsequent press release from the government stated that RÚV’s figure was incorrect, and the cuts required of the hospital next year will amount to ISK 400 million ($2.95 million/€2.49 million). “On the other hand, the hospital will receive ISK 1.3 billion to address the growth in population and the increase in the relative number of elderly people, as well as additional funding to address salary and price hikes. It is also clear that Landspítali will be compensated for increased expenses due to the COVID-19 epidemic.”

Journalists Let Go at RÚV

The hospital is not the only government-funded institution facing cuts in Iceland. National broadcaster RÚV will lay off around one fifth of the journalists in its news department due to reduced funding and some of the layoffs have already taken effect. The Society of Broadcast Journalists (the union for broadcast journalists who work at RÚV) has criticised the cuts. A statement from the institution reads, in part: “When the media’s ability to engage in critical journalism is reduced, there is a risk that the public’s access to accurate and clear information will be reduced. This is especially dangerous in times where misinformation is rampant.”

The statement goes on to say that those who have been let go are “high-quality journalists, including an employee with more than a quarter of a century of service at the agency.” This employee is one of several that is in an ongoing dispute with RÚV concerning overtime pay. In its statement, the Society of Broadcast Journalists questions the decision to let the employee go before the issue has been resolved.

This article has been updated to include the government’s response to RÚV’s original story on cuts to hospital services.