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Snow Jackets. In Finland, the Social Democrats came out on top in an April election, for the first time in 20 years, after campaigning on tax hikes to meet the rising costs of welfare. Nordic countries still top other high-spending Organisation for Economic Co-operation and Development countries such as the United States, Germany and Japan for public spending per capita on social benefits targeted at the poor, the elderly, disabled, sick or unemployed. Denmark itself spends a higher proportion of its wealth on public welfare than most European countries, at 28 percent of GDP, behind only France, Belgium and Finland.
But many Danes are distressed at the way things are going following two decades of economic reforms. Cuts to health care services, which include everything from free doctor appointments to cancer treatment, have led to the closure of a quarter of state hospitals in the past decade alone. As a consequence the proportion of the 5. Other cuts over the past 10 years have led to the closure of a fifth of state schools, while spending per person above 65 years on services such as care homes, cleaning and rehabilitation after illness has dropped by a quarter.
Since the early s, governments have also pushed through unpopular measures to encourage people to work longer.
They include gradually increasing the retirement age to 73 — the highest in the world — in decades to come from 65 currently, phasing out early retirement benefits and cutting unemployment benefits to two years from four. While the policies have generated economic growth averaging 1. Frederiksen says she will increase public spending by 0.
Frederiksen is however bound by a law not to allow a public deficit of more than 0. Rasmussen has argued that an acceptable level of welfare can be achieved in part by technological advances and letting more private players into areas like health and elderly care. With government debt at 49 percent of GDP, way below the OECD average of percent, and a budget close to being balanced, there is room to raise welfare spending, according to economists.
However Jan Stoerup Nielsen at financial services group Nordea said certain election promises, such as those by both candidates to come up with 1, to 2, new nurses, were unrealistic at a time of record high employment of 2. He warned more public spending risked overheating the economy and hurting growth down the line if more people shifted from the private to public sector.