Response to interpellation 2023/24:258 on new start jobs

Arbetsmarknads- och integrationsministern Johan Pehrson (L)

Mr. Speaker! Teresa Carvalho has asked me if the government intends to change the regulations for start-up jobs in order to put a stop to the fraud.

In her question, Teresa Carvalho refers to the Swedish National Audit Office's recently published audit, Subsidised employment - to counter errors in a system with serious risks (RiR 2023:17).

The Government welcomes the National Audit Office's review. The work to counter incorrect payments and subsidy fraud directed against the public sector is a high priority for the Government. Naturally, payments from the welfare systems must be correct.

According to the regulatory letter for 2024, Arbetsförmedlingen shall contribute to the overall goal that payments from the welfare systems shall be correct, the proportion of incorrect payments shall decrease, and errors shall be countered. The proportion of incorrect payments from the compensations that Arbetsförmedlingen manages shall therefore decrease. Arbetsförmedlingen shall report on the goal fulfillment, the measures implemented to reduce the incorrect payments, and an assessment of the effects of the measures.

The Riksdag handed over the National Audit Office's report to the government on 21 November with instructions to, within four months from the handover, submit a communication to the Riksdag regarding the audit report.

The Government will return to the Riksdag with such a communication in the near future.

The speech at riksdagen.se, in Swedish (opens in a new tab)

Teresa Carvalho (S)

Mr. Speaker! A new audit from the Swedish National Audit Office has, as it says, shown that there is massive cheating with subsidized employment. And the right's favorite measure, the nystartsjobben (new start jobs), is pointed out as being particularly problematic.

We Social Democrats had already, before this review, submitted proposals that the control of the new start jobs should be tightened. But the Sweden Democrats and the government have said no to that.

Employment Minister Johan Pehrson is quick to point out fraud committed by individuals as a major problem, which it indeed is. But when it comes to companies that cheat and engage in shady dealings, he chooses a significantly more relaxed attitude.

Everyone who can work shall work, and everyone who needs help to get into work shall receive help. Therefore, we Social Democrats are very concerned and upset that the SD government, now in the middle of a recession, when unemployment is increasing and jobs are scarce, chooses to cut significantly on active labor market measures. This affects primarily those who already have a weak connection to the labor market. For some of them, a subsidized employment can be a good measure to get closer to self-sufficiency.

But with that said, these subsidies must be managed in a wise manner. And we Social Democrats have long warned about how easy it is for companies to exploit these subsidies in a very bad way, which leads to an extensive waste of our common tax money and at the same time risks knocking out serious companies.

During our government's time, we did a number of things to try to address this fraud. We ensured, for example, that trade unions received better conditions to submit statements to Arbetsförmedlingen regarding a workplace's suitability to receive these grants. But Johan Pehrson has announced that he intends to tear it up next year.

We have also in vain tried to get the Liberals on board with the insight of how important it is that companies that are allowed to receive these startup subsidies are also covered by collective agreements, because it is obviously a major problem when people who are in a vulnerable situation lose much of the protection that otherwise exists on the labor market and they also end up in the clutches of unscrupulous companies.

We Social Democrats have, as said, proposed that a labor market policy assessment should be made in every individual case of whether this startup subsidy shall be granted, simply to eliminate fraud, cheating, and exploitation of our tax money.

The National Audit Office has now submitted this report which confirms the picture we have had since earlier, namely that a sensible control is lacking. And the reason for the failure is actually quite simple, namely that the nystartsjobb, unlike other subsidized employments, do not require any actual assessment. If one meets certain criteria, it is largely sufficient to press the button and cash in the tax money.

We Social Democrats think this is wrong. We believe that an assessment must be made in every individual case in order for there to be order and clarity. And obviously, companies that receive grants from the state shall be covered by collective agreements.

We have put a sharp proposal on the table. All that is needed now is for Johan Pehrson to come to his senses. I note that he does not really want to answer the question of what he intends to do. He wants to reflect a bit more.

Let me then ask: What is it that makes the minister hesitate?

The speech at riksdagen.se, in Swedish (opens in a new tab)

Serkan Köse (S)

Mr. Speaker! I thank the Minister for the answer, and I thank Teresa Carvalho for a good interpellation.

This is an important issue. Johan Pehrson often says that we should manage our tax funds and resources in an efficient way. I agree with that view, that we should manage our resources efficiently. Every single krona must be used for the right purpose.

The subsidized employments cost 18 billion kronor every year, and they affect approximately 150,000 people. We Social Democrats believe that it is important that the subsidized employments exist and that they are an important measure. There are, in fact, very many different target groups, and people have different circumstances. Therefore, it is important that there are different types of state incentives and measures to help those people who need support to establish themselves in the labor market.

The National Audit Office's report is quite serious and very harsh in its criticism. Among other things, it highlights that the design of the supports can also facilitate abuse, which Teresa Carvalho took up, and that above all, parts of the control are ineffective. There is also criticism regarding the risks with the design of the measures - including sham employment and poor working conditions - and that the measures also go to persons who are not entitled to these employments.

The Swedish National Audit Office particularly highlights the nystartsjobb (startup jobs) that we are discussing, which were introduced by the Alliance government – Johan Pehrson's friends – in the belief that the more money pumped out to companies, the more people would get employment and work. What was missed then was that it became a rights-based measure that would go to everyone who meets the conditions, which meant that the money was pumped out without any control whatsoever. This is highlighted quite clearly in the Swedish National Audit Office's report, where it is argued that the nystartsjobb are risky because the compensation is high and the controls are fewer than for other supports.

Then it can be discussed why companies are controlled less than the individual in this case.

Then one can also observe that since this is a rights-based measure – everyone who meets the conditions receives a nystartsjob – it takes resources from other measures. The Government has allocated funds for labor market policy interventions and measures for the nystartsjobs. This means that now, when not so many people are getting nystartsjobs, the money is returned. It would be interesting if the Minister could say something about this inefficiency.

The government has now committed wholeheartedly to ensuring that the "nystartsjobb" (new start jobs) lead to more people getting jobs. They removed extra services, among other things, because they thought it was inefficient. But the extra services were intended for target groups who needed them in order to be able to enter the workforce.

In this case, one can see that Arbetsförmedlingen, with the reduced resources and appropriations, has a reduced assignment capacity. They are unable to get all people into new start jobs, and this applies especially in the economic crisis. There must be companies that take in people.

It would be interesting if the Minister could say something about the redistribution of funds that go to the "nystartsjobb" (new start jobs). Will we be able to see some kind of change regarding the "nystartsjobb" from the aspect of a rights-based measure? This applies in particular to the funds that are set aside for the "nystartsjobb". Will the Minister review these resources?

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Arbetsmarknads- och integrationsministern Johan Pehrson (L)

Mr. Speaker! Let me first state that the National Audit Office's report is very important. It points out serious risks and that, in the worst-case scenario, there is pure organized crime behind this. The extent – how large the problems are – is something the National Audit Office is a bit more cautious about saying anything about.

Mr. Speaker! The Government sees that 100-150 billion are being turned over in serious organized crime. It concerns everything from extortion to drug trafficking, but it also concerns the exploitation of the welfare systems that exist. The activity has grown over many years and is today a threat, actually a systemic threat, to Swedish society, to trust, and to democracy.

That is why the government is taking powerful measures to upgrade the justice system and to strengthen agency cooperation against serious organized crime. It is about more people in the justice system, new tools for the justice system, and relevant sentences for those people who are to be locked up and not be in either new-start jobs or on the street. These are people who need to be met with a completely different force. This is what the government is doing. We created the Swedish Payments Agency to reduce all this fraud, because unfortunately, it is the case that where there is support, there is also a risk of fraud.

We will return on the matter as requested by the Riksdag, Mr. Speaker, regarding the report within the time that the Riksdag has determined.

The government believes that it is important to maintain subsidized employment. In fact, we are now supplementing the startup jobs with establishment jobs to see what the parties, among others, can do together to help people who are far from the labor market to get in. They may need to have support at the beginning in order to then be able to get a regular job. There, this type of support plays an important role.

I believe that establishment jobs can very well become an important part for people instead of new-start jobs. The government has already taken measures and given this important assignment to Arbetsförmedlingen in order to be able to stop unserious or purely criminal actors from exploiting the system with new-start jobs. It is about the possibility of controlling employers before decisions on subsidized employments and a more efficient processing of personal data.

Not least, Arbetsförmedlingen itself points to the power it gains through digitalization to be able to do this better. Arbetsförmedlingen has received an increased focus on this through the regulatory letter. Fraud shall be significantly reduced and preferably eliminated, and it is Arbetsförmedlingen's important task.

One effect of stricter controls can be that not all resources are used. The reason that the resources are not used can be that a considerable number of applications are stopped because it has been seen that things are not quite in order.

The speech at riksdagen.se, in Swedish (opens in a new tab)

Teresa Carvalho (S)

Mr. Speaker! With respect for the fact that the government will later in the spring submit a letter in response to the National Audit Office's review and criticism in the area, I must say that if Johan Pehrson had seen the seriousness of the criticism and seriously wanted to stop the fraud and trickery with the nystartsjobb, he could have answered yes to my simple question about whether the government is prepared to tighten the regulations. I note that he has wanted to dodge. He wants to think a bit more. I think that is a quite telling answer.

The privatization and laissez-faire liberalism in labor market policy is somewhat of a common thread for Johan Pehrson. I thought I would read out what he wrote in his last budget motion before he became Minister for Employment specifically regarding the nystartsjobb. He wrote: "The form of employment is also popular among employers, as it does not require any labor market assessments. The Liberals therefore want to expand this form of subsidized employment, while other less effective labor market policy measures are scaled down. It is at the same time important to note that the difference in participation between women and men is greatest when it comes to the nystartsjobb."

Note that it is precisely these subsidies, with the most unequal profile, that Johan Pehrson wants to invest more in and instead scale down other, needs-based, supports that have better accuracy from an equality policy perspective.

It has been established previously that women receive poorer support within the labor market policy framework. To change this imbalance, we Social Democrats highlighted this clearly in the regulatory letter governing Arbetsförmedlingen when we were in government. But these writings were removed by Johan Pehrson from the regulatory letter last year. I think this is interesting.

What I just read out from the motion Johan Pehrson wrote before he became Minister for Employment is also telling in several ways. Besides the equality aspect, the Liberals write quite shamelessly that they want to invest in the "nystartsjobb" (new start jobs) precisely because they are popular among employers since they avoid having to make the assessment. It is crystal clear that it is popular among employers to avoid making this screening! The entire system is rigged in a way that attracts unserious and even criminal actors who can exploit it.

There is a lot of talk about fighting crime from the SD government, but when it comes to cheating and fraud in the working life, it is a blind spot. It is clear that it is more important that it is cheap and easy for companies to make money than that there is order and regularity on the labor market and fair conditions for the employees.

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Serkan Köse (S)

Mr. Speaker! I did not quite receive an answer to my questions regarding how the Minister intends to handle the challenges that exist with the start-up jobs.

The Minister of Justice took up that they want to combat serious crime, which is important, and that they want to strengthen the justice system, which is also important. The justice system shall be strengthened. But if we look at combating crime in the labor market, we see that there are no more resources.

We have had a debate before on how Arbetsförmedlingen should be able to handle incorrect payments. Arbetsförmedlingen has paid out half a billion in incorrect payments. There is nothing about this. It is about increased resources to an agency that is supposed to increase the controls. It actually says in the Riksrevisionen's report that it takes a long time before suspected errors have been investigated and that it is unusual for people to be convicted for having misused the measures.

In order to be able to do this, Arbetsförmedlingen needs capacity. They need greater resources to handle this with incorrect payments. It concerns half a billion in incorrect payments, regarding the matter of husbanding our common resources. Furthermore, a very large amount goes to organizations that foster crime, which Johan Pehrson raised. If we are to tackle welfare crime, which Johan Pehrson referred to in the regulatory letter to Arbetsförmedlingen, and if Arbetsförmedlingen is to manage this, more resources are needed.

Again: Rights-based measures lead to incorrect payments that fuel crime. What does the Minister intend to do to put a stop to this here and now?

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Arbetsmarknads- och integrationsministern Johan Pehrson (L)

Mr. Speaker! It is not surprising that the Social Democrats are running away from their own responsibility like a hired hand in January - it just rushes out through the door. After eight years with the Social Democrats, a Sweden has been built where cheating and fiddling occur. One has been lax in crime fighting. We are now changing this with all our might.

Regarding the nystartsjobb, Arbetsförmedlingen has received new opportunities and new tools. I do not rule out, Mr. Speaker, that these may need to be sharpened further. We have reduced the subsidy level in these supports so that they are not too generous; even this reasonably has an effect on the usage. The Swedish Tax Agency, together with Arbetsförmedlingen, a-kassor and others, is empowered to ensure that there is no cheating.

I was in on the importance of strengthening the police and prosecutors. If a crime has been committed, it is they who are to investigate it. We have a justice system that today is under enormous pressure. What do you do then? Well, then you let the justice system grow to regain the trust and confidence that people who commit crimes are prosecuted. There is no other way.

This is happening now, after people have sat on their hands for eight years. There is no one who wants anything other than that crime, also within the framework of subsidized employment, should be combated. We will return to this Riksdag, just as the Riksdag has ordered, with our answer on how we view this and what we want to do further.

It is impossible to escape the fact that it is about resources for the justice system and that Arbetsförmedlingen receives new tools, which it has. One ensures that it is not paid out too much. Just now, I received criticism because we do not spend all the money, but it is about not providing support to everyone. They control, but it may be necessary to do even more.

There is also no question that you from the Socialdemokraterna have only one thought, namely extra services. That is what you contribute. We are to give money to the municipalities, which shall be able to hire people and hide people away without it leading to regular jobs.

Believe me - there is nothing more important for this government than to combat crime and the crime that is now being debated in this interpellation.

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Teresa Carvalho (S)

Mr. Speaker! I must begin by thanking Johan Pehrson for this debate.

In almost every sector affected by the right's eagerness for privatization, extensive fraud is discovered sooner or later. We have seen it within the market school, within the healthcare sector, and when it comes to the private HVB homes. Now we also see more and more clearly how this problem is eating its way into the labor market policy, but the naivety towards this is a blind spot for Johan Pehrson.

It is a bit typical of Johan Pehrson to want to talk away his time by bringing up the Social Democrats' previous eight years without even mentioning with a single syllable the influence he himself had over the labor market policy during these years. For example, he did not want to contribute to there being requirements that these supports be covered by collective agreements.

I had hoped, but perhaps not expected, that we would receive a clearer answer here today on whether the government will tighten the regulations for the nystartsjobb. We Social Democrats have, as mentioned, proposed that an assessment should be made in each individual case so that companies can be allowed to receive these supports. We consider this to be more reasonable than the alternative, which would be to build up giant and very expensive control apparatuses to hunt for the fraud after it has already occurred.

Finally, Mr. Speaker, I want to say that 2023 was a pitch-black year regarding fatal accidents in working life. Unfortunately, we see a pattern: Many of these fatal accidents occur in industries that are heavily affected by cheating and trickery with all sorts of things in order to maximize profit. That in this situation, there is no control over new-start jobs, which actually increase the risk of cheating and trickery, and that these are not covered by requirements for collective agreements - with everything that entails for insurance and so on - can mean that relatives lose out on survivor's benefits and funeral assistance. This is one final example that shows why Johan Pehrson needs to rethink in this issue.

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Arbetsmarknads- och integrationsministern Johan Pehrson (L)

Mr. Speaker! When the Riksdag exercises its very important oversight power towards the government, it is also important that the Riksdag and representatives for, for example, the interpellation tool take into account the whole picture and what has been done previously – otherwise, it becomes very difficult to even discuss this.

The question of trust and the work against fraud, crime, and corruption is central. Sweden faces enormous challenges there right now. If you travel to my own county, Örebro, and see how the public dental care functions, with direct friendship corruption, you see proof that we are not even escaping this plague in the public sector. It is about crime, corruption, and various ways of bypassing the system.

Unfortunately, control is important. The controls have been tightened. The investments against work-related crime, which this is included in, are highly prioritized. Major efforts are being made. The question of safety – that one should not die, be injured, or become ill at one's workplace – is very important. Here too, the government is carrying out central work for safer jobs and so that people can get new jobs, which is very important.

In conclusion, I want to say that nine out of ten jobs in the Swedish labor market are indeed covered by collective agreements. I know there is another opinion, namely that this should only apply to those companies that have collective agreements. But we have a freedom in the Swedish model, and it is up to the company to decide whether they want to join. Many companies make use of collective agreements. Most are covered by this. I think that is important.

The interpellations debate was hereby concluded.

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