How does the cost of childcare in Norway compare to other Nordic countries?

The Støre government has presented its budget proposal for the upcoming year. Not surprisingly, due to the extraordinary circumstances at home and abroad, the budget is characterised by austerity, cuts, and measures aimed at addressing the energy, inflation, and security crises.

The Centre Party’s Finance Minister Trygve Slagsvold Vedum presented the budget changes on Thursday morning.

“We are facing challenging times. This budget reflects the government’s most important task, which is to safeguard its people. The budget is designed to reinforce national preparedness and safeguard household finances.

“The government aims to bring inflation under control and ease the pressure on interest rates while promoting job security and reducing social and geographical differences.

“Furthermore, we are submitting a budget which entails a substantial redistribution to benefit the nation as a whole. Those who have the most can afford to contribute more, while ordinary people with ordinary income will get tax relief.

“We are reinforcing emergency preparedness and civil protection and protecting important public services like schools, health, and elderly care across the whole of Norway,” Vedum said.

Reduced income tax and higher tax deductions for trade union fees

Finance Minister Vedum pointed out that the budget proposal focuses on fair distribution and safeguarding people’s everyday finances.

Therefore, the government is proposing a reduced income tax for people with income below 750,000 kroner. If the proposal is adopted, a family with two incomes of 550,000 kroner will pay about 7800 kroner less tax in 2023, compared with the 2021 rules.

The calculation is based on the assumption that wages are their only income and that they only have standard deductions, meaning the personal allowance and the minimum standard deduction.

The government also wants to increase the tax deduction for trade union fees to 7,700 kroner.

Support measures for single parents and young people

The budget proposal includes an annual income increase of up to 11,500 kroner for single parents with low income.

In 2023, the increase would amount to 9,600 kroner, as the restructuring of the support measure would take place from March 1.

The Centre Party’s leader also wants to increase the housing grant for pupils who are unable to live at home while attending upper secondary education by 660 kroner per month, as well as increase the equipment grant for upper secondary education pupils.

At the same time, the government is proposing a “young persons’ guarantee” for unemployed people under 30 years of age, and a qualification and employment package, with the goal of getting more people into the job market.

The budget proposal also envisions an additional price adjustment of the study grant, paying out 1500 kroner more in the grant for the 2023-24 school year, as well as increased cancellations of student loans from the Norwegian State Educational Loan Fund for people living and working in the Finnmark and Nord-Troms area.

Cheaper ferries, reduced road usage tax on fuel

Always a hot debate issue in Norway, ferry fares are to be halved – compared with rates as of January 1, 2021, and free ferry travel will be offered to Norwegian island communities without road connections.

The road usage tax on fuel should be reduced by nearly 1.9 billion kroner, with the goal of lowering the total duties on fuel.

Increased tolls, VAT on “expensive” electric cars

As has previously announced, the government plans to introduce VAT on the more expensive electric cars.

As a result, consumers in Norway might have to pay VAT on electric cars that cost more than 500,000 kroner from January 1, 2023.

Furthermore, as the proportion of electric cars on Norwegian roads is increasing rapidly, the budget proposal also recommends an increase in tolls for electric cars.

However, the final toll rate is set by the municipalities, so they will get to decide whether they want to increase the toll rate for zero-emission vehicles.

Continued electricity subsidies

One of the key items in the proposal – the electricity subsidy package – is estimated to amount to a total of 7 billion kroner.

The package should ensure continued electricity subsidies for Norwegian households throughout 2023.

For example, if the proposal is adopted, the estimated subsidy for power consumption of 22,000 kW/h in southeast Norway would amount to 33,000 kroner in 2023.

Social assistance and unemployment benefits

In an attempt to save up to 200 million kroner next year, the government is proposing to reduce the earnings period for unemployment benefits from three to one year.

According to the proposal, the resulting savings would be even greater in the long term. The government also wants to adjust the level of labour market measures, which could cut expenditure by around 700 million kroner.

Furthermore, the budget envisions continued specific upward adjustment of indicative rates for social assistance, as well as an extended period of work assessment allowance (AAP) for recipients who need more time for assessment, and a holiday supplement for unemployment benefits.

Public welfare services

The budget proposal makes room for growth in the municipal sector’s free income to secure key welfare services in Norway.

It also entails a package of measures to keep and recruit more general practitioners – a burning issue in the country’s healthcare system.

The effects of the COVID-19 pandemic on mental health and substance addiction in the country have figured prominently in the public debate, and the government plans to address the issue through a targeted package of support measures in the area.

Furthermore, it is also increasing funding for grants for social inclusion measures for children and young people.


As previously announced by Minister of Education Tonje Brenna of the Labour Party, the government plans to reduce the maximum price for daycare to 3 000 kroner per month.

If the proposal is adopted, from August 1, daycare will be free for all children in Finnmark and Nord-Troms, and – in the rest of the county – for the third child in families that have three children in daycare at the same time.

The reduction in the fixed price should amount to 50 kroner per month compared to the current price, but the government’s planned allocation for preschool measures amounts to a total of 426.2 million kroner.

Out of that total, the reduced maximum price for pre-school places will cost Norwegian taxpayers 329 million kroner, while the expense of free pre-school for the third child and the measures supporting pre-school in the north amount to 20 million and 77.2 million kroner, respectively.


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