|
In a world where economic growth and consumption is considered god, and
resource wars to get more energy secured are becoming dreaded reality, saving
oil wealth for a rainy day seems idyllic. kwc The country that's got it all - but is still saving for tomorrow Exporting oil at
$70 a barrel has turned Norway into the wealthiest nation on earth. So what
does it mean to have the highest GDP per head on the planet? Patrick Collinson, The Guardian/UK, Saturday May 20, 2006 Maureen
Baird moved to Oslo in 1960 from Scotland. In her native city of Glasgow, times
were hard, but she found they weren't much better in Norway. "People
forget just how poor the country was. Its history was about getting out on the
boat to America. We had two pairs of shoes, one for summer and one for winter.
No one had any money." Today she lives in a
society which, on paper at least, enjoys the greatest affluence the world has
ever seen. Its GDP in 2005 rose to £35,800 per head (that's for every one of
its 4.5 million population) leap-frogging past both Switzerland and the United
States, and way ahead of Britain's £21,000. This year it will
reach dizzier new heights. Forget public borrowing and the national debt -
there isn't one. Instead, there's a huge tax surplus, and the national debt has
been paid off. But what do these
figures mean? Are Norwegians basking in incomparable affluence? What's it
really like to live in the wealthiest country on earth? Arriving in Oslo, the
airport terminal is spanking-new, enormous and eerily quiet; all signs of
prestige spending projects funded by easy money. The bullet-style train into
the city centre is the first warning of price shocks to come; £30 return for a
15-minute hop, but at least the ticket seller smiles. And I thought the
Heathrow Express was the world's priciest train. In oil-boom Oslo, one
might expect rows of Dubai skyscrapers, swaggering executives and a glut of fat
4x4s. Instead, it's more like Birmingham city centre on a quiet shopping day.
There's two big glass towers, but they were built in the 1960s and most
Oslo-ites would happily see them demolished. Perhaps the shops are
quiet because, unless you're on a Norwegian salary, the prices are eye-popping.
Even the well-off Danish on day-trips gasp. Norwegians, meanwhile, pour over
the Swedish border every weekend just to pick up groceries. And when they fill
up their (heavily-taxed) cars, the price they pay at the pump is amongst the
highest in Europe. Rather like whisky in Scotland, there's no discount on
petrol just because they make it there. But don't be fooled by
the sky-high prices; even after taking them into account, Norwegian incomes
still top the table on a "purchasing power parity" basis. Though food
and drink (especially wine) is at times gobsmackingly expensive, other goods
are on a par with Britain. Housing in Oslo (despite recent rises) is cheaper
than London. So where's the money
going? Is the government splashing out on schools, hospitals and lavish welfare
projects? A brief visit suggests spending is indeed up - a new cancer wing
here, a fancy new school gym there - but nothing that shouts boom-time. At Uranienborg school
in the west of Oslo, scaffolding covers the fabric of the building, with the
(Polish) decorators hard at work. Inside, the 525 students are hard at work,
too. And it's here you come closer to the contented, placid (at times almost
docile) society that Norway's wealth has created. I asked a class of
15-year-olds about their job prospects. Would they find jobs after school?
Would they earn enough to buy homes and obtain the standard of living their
parents enjoy? The answer was a unanimous "yes". Unemployment is,
after all, the lowest in Europe. On a claimant-count basis it is around 2.5%,
close to half the level in Britain. Another sign of
contentment and economic security is the country's fertility rate. Norwegian
mothers have more children per head than anywhere else in Europe except Iceland
and Ireland. Norway also has among the highest level of female participation in
the workforce. Squaring the circle is maternity leave that stretches to 42
weeks on full pay. But visitors are still
left scratching around for signs that they're really in the richest place on
earth. Where are the Ferraris and Porsches? Why, in a country almost smug about
its superior welfare standards, are there an uncomfortably large number of
beggars and rough sleepers around the central station? The answer lies in a
remarkable decision taken many years ago to ringfence the flood of oil revenues
from the North Sea. Every dollar earned is swept straight into what was once
called the State Petroleum Fund
but is now called the Government Pension Fund.
The truth is that Norwegians are simply not spending their oil windfall, but
putting it aside for the future. What's more, none of the money is allowed to
be invested in Norway. The fund has ballooned
in size and recently became the world's biggest pension fund, for the first
time outstripping "Calpers" the $200bn Californian Public Employees
fund. Auke Lont, the head of Norway's biggest economic consultancy, ECON, says:
"It's almost Calvinist. These are people who almost want to punish
themselves for this enormous windfall." For now, at least,
policymakers have convinced the public that spending the oil money will only
result in the "Dutch disease". In the late 1970s the Dutch economy
was flooded with dollars after finding huge gas deposits, and the country went
on an unprecedented spending spree. The economic hangover took a decade to
unwind. But not all Norwegians
buy into this frugality. The far-right, anti-immigration Progress Party has
overtaken the Conservatives to become the official opposition on a populist
platform of tax cuts and spending the oil wealth on hospitals and care for the
elderly. It is also tapping into
xenophobia in a country that has always taken pride in its permissive
liberalism. News magazines in recent weeks have focused on what are described
as Nigerian prostitutes lining Oslo's equivalent of London's Oxford Street late
at night and an influx of East European beggars. The Progress Party is
winning support from around a third of Norwegian voters, and its leader, Ms Siv
Jensen, may easily be Norway's next prime minister. Is Norway docile and bland?
Maybe not for much longer. The artist Name: Vanessa Baird
Age: 42 Government grant:
£14,000 a year in perpetuity Child benefit: £240/month Struggling British
artists, look away. Oil-rich Norway gives life-long grants to local artists,
worth around £14,000 a year, every year, until the day they retire. Then he, or
she, picks up a generous state pension. What's more, the artist is under little
or no obligation to produce, install or display their work. Vanessa Baird,
daughter of a Scottish mother and Norwegian father, knows she's lucky; the
scheme is only open to selected artists. But for those who don't qualify,
Norway still offers an extraordinary array of grants much superior to anything
available in Britain. Her
guaranteed income is low by Norwegian standards, but she says: "I can at
least enjoy a minimum standard of living." A single parent, the
child benefit for her three children (aged six, four and 18 months) brings in a
further £240 a month, though most of that goes straight on kindergarten fees. A watercolour artist,
her studio is housed in her 19th-century four-storey home in a boho part of
Oslo with more than a whiff of San Francisco's Haight-Ashbury community.
British visitors might recognise shades of Paula Rego in her work, but she also
paints Norwegian landscapes, in which the characters are, ahem, pleasuring
themselves in the fjords. Her home, shared with
her artist mother, is strewn with old copies of The Guardian. She's concerned
at increasingly vulgar displays of wealth and the country's drift away from
Swedish style welfare to Anglo-Saxon capitalism. "There's a lot of new
rich with piles of money and they're proud of it. Before the King died, it
wasn't the thing to be ostentatious about money, but that's not the case
today." The former King, she says, was the archetypal Scandinavian
monarch-on-a-bicycle. But she marries
left-wing politics with patriotism and a rejection of the EU. "Norway is a
very participatory democracy and we don't want Brussels pushing us around. If
we want to kill our whales, we will carry on doing so. No-one's going to tell
us what to do." The teacher Name: Gro Larsgaard Age: 58 Pay: £36,800 (inc
Oslo weighting) Pension (from age
62): £21,800 Gro first began
teaching in 1974 at Oslo's Uranienborg school, now one of the most sought-after
state schools in the capital. It is close to the top of the
(recently-introduced) performance league tables, and its beautiful late
Victorian buildings are enjoying a facelift, in part due to oil-fuelled public
spending increases. Gro, a senior teacher
who spends much of her time training junior colleagues, is justifiably proud of
the school. After 32 years she remains upbeat and engaged, the opposite of the
stereotypical harried and dejected state school teacher so frequently portrayed
in the UK. Her pupils have, if anything, become more studious and less
rebellious. Dubbed "curling children" by educationalists in Norway,
they are being pushed harder and harder by their parents to gain entry into the
best pre-university colleges. "They have a more
positive outlook than ten years ago, parents are more motivated and some, at
least, are studying harder than before. But as a nation we are becoming more
egotistic. Before, it was about working together and being communitarian,"
says Gro. The league tables were
British- inspired, and deeply controversial. Now schools are resisting another
British import; assessment testing from a young age. "It's just beginning.
The other day a politician was calling for testing for seven-year olds. Can you
imagine?" It is debateable how
much the schools are sharing in Norway's vast oil wealth. Money is being
lavished on the fabric of the buildings and, inside, classrooms are
liberally-equipped with modern technology. But pay levels have
lagged soaring earnings in the private sector and teachers are feeling
undervalued. The starting salary for a graduate teacher is £22,500 a year -
little different to Britain, where newly-qualified teachers start next year on
£20,133 or £24,168 in London. Given Norway's sky-high consumer prices, plus
soaring housing costs, it leaves new teachers with little to live on. There is constant talk
of a strike over pay later this year. Gripes also include plans by the
government to withdraw extra payments for what are regarded in Norway as the
"heavy" teaching subjects (which include English), and longer working
hours. "They seem to think that nine hours a day is not enough," says
Gro. The nurse Name: Elisabeth
Mannion Age: 30 Pay: £28,600 Child benefit:
£80/month Neurological nurse
Elisabeth Mannion could be the poster girl for Norway's contented society, its
well-funded NHS and extraordinarily generous welfare system. Elisabeth (who
takes her English-sounding surname from a Sheffield grandfather) works at
Ulleval Hospital, Norway's biggest. "I've got a great life, I'm really
happy with my job and I wouldn't want to live anywhere else," she says. Her daughter, Sophie,
is only 15 months old but Elisabeth is back at work 35 hours a week. It's down,
in part, to the kindergarten childcare system, but also to its eye-wateringly
attractive maternity leave arrangements. Elisabeth was able to take 12 months
maternity leave, of which 42 weeks was on full pay. Her husband also got paid
paternity leave. Her concerns (and
there's not many) are for younger nurses who now face soaring house prices.
"We've had decent pay rises, but prices for apartments have gone up so
much. And they've also started selling off nurses' homes to developers. We were
lucky - we bought a flat for 1.3m krone and sold it for 2m (£174,000). We've
bought a house in the suburbs, but it only takes 30 minutes to drive to
work." During holidays, she
frequently goes to her family's country cabin. "We go skiing, take Sophie
sledging, it's lovely in winter. I think I have a good life." http://money.guardian.co.uk/weekly/story/0,,1778822,00.html |
_______________________________________________ Futurework mailing list [email protected] http://fes.uwaterloo.ca/mailman/listinfo/futurework
