Response to interpellation 2024/25:95 on LKAB's role for the Swedish mining industry
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
I believe that LKAB is a crown jewel that should act transparently and exemplarily by following the state's ownership policy and legislation 1 2. I mean that the government should steer through ownership dialogue regarding return and sustainability, while operational details are up to the company's management 2 3. I emphasize that LKAB is important for Sweden and local communities by creating jobs, providing money to the state treasury, and supplying the world with iron ore 4. I believe it is important to create good relations with the surrounding community 4. SD argues that the state should be an active owner that points with a firm hand. SD criticizes LKAB's handling of villa owners in Malmberget 5 and emphasizes that LKAB must act as an example to safeguard the mining industry's reputation 5 6.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Finansministern Elisabeth Svantesson (M)
Madam Speaker! Eric Palmqvist has asked the Minister for Energy and Industry what general measures she intends to take within her area of responsibility in order to increase the reputation of the state-owned mining company LKAB locally and in this way contribute to strengthening the mining industry's reputation both locally and nationally.
The work within the government is distributed in such a way that it is I who shall answer the interpellation.
LKAB and other companies with state ownership are subject to the same laws as privately owned companies, including the Companies Act (2005:551). It is the company's board and management that are responsible for the company's organization and the management of its affairs, as well as the ongoing management of the company's operational activities. Furthermore, companies with state ownership shall, according to the state's ownership policy, act in such a way that they enjoy public trust. The board is responsible for ensuring that LKAB is managed exemplarily within the framework of the legislation, the company's articles of association, and the state's ownership policy. It also follows from the ownership policy that LKAB shall act transparently regarding the management of risks and opportunities within the area of sustainable business. This shall be achieved by maintaining an open and constructive dialogue with the company's most important stakeholders, both locally and nationally. The work shall also be communicated both externally and internally. The Government has confidence that LKAB handles issues related to the company's reputation in a responsible manner.
Eric Palmqvist (SD)
Madam Speaker! Thank you, Minister for Finance, for the answer, even though I must admit that the answer was a bit perfunctory and perhaps did not quite breathe the enthusiasm and vision for the state's role as an owner of one of our continent's larger mining companies that I had hoped for. I do not doubt, however, the Minister for Finance's understanding that LKAB's role in this context is important, and I both believe and hope that she shares the same positive view of the mining industry as my Minister for Energy and Industry, Busch.
I also believe that the Minister for Finance and I are largely in agreement regarding LKAB's importance for Swedish industry and raw material supply. I live in one of LKAB's production sites and can testify to LKAB's importance for the well-being and faith in the future of an entire region. I have myself worked underground for ten years in LKAB's mine in Vitåfors outside Malmberget and know how the mine lives in symbiosis with the community despite tremors, subsidence, mine dust, and similar phenomena.
With that said: It is clear that since my interpellation was submitted, things have somewhat begun to move regarding the relevant local underlying causes that prompted the interpellation. The response to the interpellation is, as the minister surely knows, heavily delayed by reasons that lie outside both the minister's and my control. Such is the way it is in politics sometimes.
As I said, I lack a vision for the state ownership of LKAB in the Minister's response. The response actually only contains a lot of factual circumstances, such as references to the Companies Act and the state's ownership policy for companies with state ownership. Everyone who has read the latter knows that it is a rather thin document with very general wording, and in any case, I feel that it grates a bit. It is very weak and diffuse when it comes to how we govern our state-owned companies. What do we have them for if we cannot be active owners and point with the whole hand? Deliver profit to the state – is that all?
When I entered politics, I thought that the state-owned companies had a higher purpose, if one can even call it that. I also believe that very many out in the country live with that misconception. But is it then a misconception? How much can we actually steer our companies through, for example, ownership dialogue?
The case with the mining company LKAB is the jewel in the crown of state-owned companies that the Swedish people own together. But even jewels have their downsides, and in today's debate, I will point out one of them.
Before we speak about the mentioned company and the specific issue that my interpellation focuses on, Madam Speaker, it still feels appropriate to pose a question to the Minister for Finance, who has companies with state ownership as one of his political areas of responsibility. Does the Minister for Finance not believe that one can set very high demands on the companies that we actually own and give them clear and company-specific rules of conduct through, for example, ownership dialogue, without it being perceived as ministerial rule?
This, Madam Speaker, I wish the Minister for Finance to answer before I proceed to the specific questions that the interpellation concerns, namely LKAB's role as a model within the Swedish mining industry.
Finansministern Elisabeth Svantesson (M)
Madam Speaker! Thank you, Eric Palmqvist, for the questions that have been asked! In my answer just now, I tried to answer the questions I received which were precisely about whether I intended to take any measures to increase LKAB's reputation locally. I think that one should try to answer the questions one has received.
Let me lay out the text. I have the pleasure of being the responsible minister for the corporate portfolio in principle in almost all companies. There, LKAB is, of course, as the member says, one of the absolute jewels that we Swedes own together. It is great values that one retrieves from the mines. When there was a stoppage on the Malmbanan, it was even noticed in Sweden's GDP figures - then one understands what levels and values are created. I and many with me feel that this is a crown jewel, and we are proud of the work that is done.
Let me just break down the question. It is indeed a state-owned company. But it also exists in a market, and it is very clear how we in the government and previous governments are to govern companies. That is done through clear ownership dialogues. There is also an ownership policy, but the operational side is up to the board to work with. We politicians, the government, or the Riksdag should not be involved in managing the details.
With that said, the ownership policy is very clear. For example, it is about our state-owned companies building trust, being role models, of course providing a return, and so on.
There are not many places on earth where exactly this transition is occurring with relocation of housing and so on. When it comes to the very specific question, I must nevertheless say that the latest survey shows that 86 percent of those living in Gällivare and Kiruna have a great deal of confidence in the company's ability to take responsibility in the societal transformation. I think that, fundamentally, is a very good grade for the fact that this has been handled in a good way over the years. Then there will always be conflicts and discussions depending on the fact that people may want slightly different things.
So, fundamentally, I have confidence that LKAB handles this issue, like the dialogue with the municipality and in this case also with villa owners. I see that they do everything they can. Perhaps they can do more, and perhaps we can become even clearer in the owner dialogues to increase confidence in the area.
A lot has happened, as the member also pointed out. On October 18, the County Administrative Board in Norrbotten announced that the values for seismic activity – it is not every day that one talks about that as Minister for Finance – in the environmental conditions had been exceeded, and it was to such an extent that LKAB must work to decommission the housing in eastern Malmberget.
What I have understood is that a constructive dialogue is taking place, and I look forward to it continuing to be constructive and that the issues can be resolved in the best possible way. Then we can continue to have a mine where the Swedish people get a share of the profits and opportunities that the mine gives Sweden. The residents in both Gällivare-Malmberget and Kiruna, where significant progress has been made, should feel that this is happening in an exemplary manner.
Eric Palmqvist (SD)
Madam Speaker! It is with pleasure that I hear the Minister for Finance raise some matters that I intended to mention in my speech.
In Malmberget, a few kilometers north of Gällivare, one is strongly affected by LKAB's mining. Large parts of the community have been bought out and decommissioned, and LKAB replaces municipal business premises according to an agreement that has been negotiated between the parties. The Minister for Finance has been involved in this.
In the question regarding villa owners, somewhat different models have been applied for compensation, and in that regard, one has not landed entirely correctly. For example, two-story villas have been valued as two-story villas, while villas with a finished basement have only had the ground floor valued. Garages have been counted as an extension and not replaced, and so on. Some feel cheated and ill-treated in a process where LKAB should protect its reputation in the area.
In eastern Malmberget, the situation is worse. It is an area that in 2012 was designated as a development area that would not be affected by the mining operations. I remember this and I remember how everyone in the area laughed already then. We knew that the area is heavily affected by LKAB's activities.
Despite the fact that LKAB has repeatedly revised its plans and deviated from the cooperation agreement with Gällivare municipality, the voluntary redemption of the properties in eastern Malmberget is still being applied under worse terms than for other affected parties. Despite the fact that properties in the area have suffered extensive damage, for example cracking, doors and windows that cannot be opened or closed and water outages, the mining company initially claimed that it was due to natural causes, only to later back down and argue that it cannot be ruled out that the mine affects the area.
What is happening now is that almost the entire part of society that was considered a development area has been decommissioned, which naturally affects both those who remain as well as the conditions for the municipality to plan snow removal and district heating. Problems also arise when the student population for the school in eastern Malmberget has disappeared because it is hardly possible to live there, while at the same time LKAB has maintained that it is a development area. Today, only fragments remain of what used to be eastern Malmberget, and therefore Gällivare municipality has tried to get LKAB to the negotiating table since 2017 but has been met with a cold shoulder. Caught in the middle are the people who remain living there.
These people state in surveys that they want to move, and many of them are feeling unwell. If the minister had made a study visit to eastern Malmberget and seen what the housing situation looks like there, she would have understood why. At the same time, LKAB seems worried about opening the stock exchange, even though it concerns trivial sums in this context.
It is only now, in recent times, that the County Administrative Board, i.e., the supervisory authority, has started to speak up. Now it seems that there might be things in motion. Does the Minister for Finance not consider it a failure when it has to go so far that the supervisory authorities have to provide instructions in matters that should have been handled much more smoothly and with a significantly greater goodwill from the state-owned company than what is the case today?
If nothing else, I believe in any case that a state-owned company should actually have the role of acting as an example for all other actors to whom we, with all rights, set high demands.
Finansministern Elisabeth Svantesson (M)
Madam Speaker! I thank Member Eric Palmqvist again for the question. It is a specific and special question. Those who are affected are affected enormously - and it is unusual.
My view from my perspective is that there has been and has been a good and constructive dialogue. Since then, as the member said, it has varied a bit over time.
But as the responsible minister in the government, who must ensure that the companies live up to what you in the Riksdag have decided, it is important that we do not enter into operational parts. We will not decide what price SJ shall have on tickets or what a bottle of red wine shall cost, nor exactly how LKAB shall resolve the issue of compensation.
My impression so far has been that they have been reasonable compensations. Others surely think differently. Regardless, it is LKAB that handles this. It is an operational matter that we politicians should not interfere in.
What are we interfering in then? Our ownership governance and dialogue with LKAB and all other companies - often with LKAB, which is large and important - is about that there should be return, long-term perspective, sustainability and exemplary behavior. LKAB is doing something that few Swedish companies and few other companies in the world have done, namely what has been done in Kiruna and what is now being done in Gällivare-Malmberget.
I have full confidence in the company, and the government will always be an active owner. I hope that all governments in the future will be. We shall be clear about the direction. But I leave the operational side with a warm hand over – because I am to do so – to LKAB's management.
Eric Palmqvist (SD)
Madam Speaker! I thank you for the answer, Finance Minister Svantesson.
I believe the Minister knows that I am enthusiastic about the Swedish mining industry. That should be known by this point. It therefore takes a great deal for me to express criticism towards Swedish actors in the field. On the whole, I am immensely proud of and impressed by the activities of Swedish mining companies, and this naturally also applies to the state-owned actor. They hold a leading position in several respects, but when I see that something is wrong, I consider it justified to highlight this. This applies in particular as I view with concern the negative and harmful public opinion that such things can give rise to. If the state-owned company does not act in a way that does not lead to dissatisfaction and opposition, where understanding exists, what will people think who face imminent mining establishments in other parts of the country by actors who perhaps do not even have state ownership behind them.
I believe it would be rewarding for the Minister for Finance if she came to Gällivare to form her own opinion about the situation. Gällivare is also beautiful. Despite the fact that Gällivare is located in red Norrbotten, it is actually her own party that is the largest party in the municipality.
I can also point out that this is an issue driven by all political parties, from right to left, in the municipality. This is not even once a party-political issue, but it is something that can be seen as a petition from me as a representative for Norrbotten and my own home municipality. This issue is of great interest to all of us who actually safeguard the Swedish mining industry and its reputation. It is important to enjoy full confidence even in the municipality where one operates.
Finansministern Elisabeth Svantesson (M)
Madam Speaker! I thank Eric Palmqvist again for the interpellation. It is important, and it highlights a large company that is enormously important for Sweden and, of course, in the locations where it exists. It is about jobs and money for the state treasury. LKAB also supplies many companies around the world with really good iron ore.
LKAB is a large company, and the government maintains a close dialogue and is an active owner. But that being said, we do not enter into operational matters.
It is good that the member has raised the issue. The question of exemplary behavior and creating good relations with the surrounding community is always important, but it is extra important if one is a large company in a smaller town with a dominant position.
I have full confidence in LKAB's management, and I see now that a more constructive discussion has started after the County Administrative Board issued information. That is good. I hope that everything is resolved in the best possible way for the people of Gällivare, regardless of which part of Gällivare they live in, and also that a solution for the future is developed for the sake of the company.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.