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EXPLAINED: Will the Social Democrats really crack down on profit-making in education and healthcare?

The Social Democrats this week proposed to ban free schools from making profits, and limit many of the advantages enjoyed by private health providers. Here's a look at what the proposals mean.

EXPLAINED: Will the Social Democrats really crack down on profit-making in education and healthcare?
Education Minister Anna Ekström is ready to end profit-making in the schools sector. Photo: Erik Simander/TT

What’s happening?

The board of the governing Social Democrats has prepared proposals to put to its party congress which would aim to “ban profiteering” in schools, as well as to impose some limits on privately run healthcare companies.

If passed at the November party congress, the proposals would then form part of the party’s manifesto in the run-up to next year’s election.

This is part of a long-running political debate on what in Sweden is called vinst i välfärden or “profit-making in the welfare sector”.

How does profit-making work in the education and healthcare sectors at the moment?

Free schools are state-funded (and free to attend) but privately-run schools that educate a massive 400,000 pupils in Sweden. Sweden pioneered opening up education to the private sector, with the free school reforms brought in by the government of Carl Bildt in 1993. 

What are the Social Democrats’ new tougher policies towards private providers of health and education? 

In a policy announcement made on Tuesday, the party promised to: 

  • ban publicly funded but privately run schools from taking out profits 
  • reduce the amount of money given to privately run schools per pupil so that they had a level playing field with municipal schools 
  • end the separate queue-system free schools use to choose their pupils, with free schools instead having to share a common school application system with municipal schools which is not based around a queue 
  • a ban on private companies operating the 1177 regional health advisory lines 

When it comes to health, the proposals were less far-reaching, but included: 

  • a ban on private healthcare providers and insurance companies from signing deals with regional health providers allowing their customers to jump queues for treatment
  • a ban on “aggressive healthcare marketing” from private providers 
  • a ban on healthcare providers treating patients whose healthcare is paid by insurance companies and also patients whose treatment is funded by the government 

Why do the Social Democrats want these changes?

“Profit-making and education don’t mix,” Finance Minister Magdalena Andersson told TT. “It’s no coincidence that none of the world’s best universities are profit-driven. They’re all trusts or publicly run. It creates the wrong incentives in the education system, both when it comes to schools and to universities.” 

Education Minister Anna Ekström said that under the current system, profits all too often came at the expense of children’s education. 

“The needs of children and young people should be put above profit-making, and the tax money we together put towards pupils should go to pupils and not to private profits,” she said at a press conference announcing the move.   

The party’s healthcare minister, Lena Hallengren, said that people should be treated on the basis of what they need, not on the basis of their ability to pay. 

“You should be given healthcare at the right time and according to your need, and not just because you have the right insurance,” she said.  

She said that “aggressive healthcare marketing” also meant that care providers were encouraging patients to seek treatment that was not absolutely necessary, simply because they wanted to earn more money from the state for carrying out treatment. 

What would it take for these new policies to come into effect? 

A lot.

This is a policy proposal from the Social Democrats’ party board, not from the government itself (although a small number of politicians hold positions in both). 

Assuming the policies are voted into the party programme at the conference in November, the party then needs to stay in power after next September’s election to be able implement them. 

Even if it manages this, it is likely that the party would need to negotiate with other parties in order to pass its proposals — after the 2018 election, for example, the Social Democrat-Green Party government was able to take power after agreeing to an extensive policy deal with the Centre and Liberal Parties.

It is likely that in future the Social Democrats may still need the support of the Centre Party, which has historically been a supporter both of free schools and of the private provision of publicly funded healthcare, although there are growing voices within the party calling to rethink this. 

In negotiations over a support agreement, however, the Social Democrats’ proposals are quite likely to be weakened, watered down, or simply rejected by the Centre Party. 

If the Centre Party were to support a move to a profit-free school system, or if the Social Democrats gathered enough support from other parties, the policy would still have to be put out to consultation and its legality assessed before becoming reality.

Given that banning profits would be a significant incursion into the business operations of some quite sizeable private companies, it is by no means certain that the legal hurdles could be overcome. 

What’s the reaction to the proposals so far?

The schools company AcadeMedia, however, dismissed the profits move as little more than an election-year gambit. 

“You have to remember that this is about political positioning,” said Marcus Strömberg, the company’s chief executive. “I have a very hard time seeing that there is anyone who would like this to disappear, because we are such an incredibly large sector.”

In a statement issued on Tuesday evening, AcadeMedia noted that no inquiry had been held into the matter, no bill had been published, and that it would take a long time to turn the proposal into policy even in the unlikely event that parliament voted it through. 

Daniel Suhonen, who co-founded the Reformisterna group of left-wing Social Democrats, said that he believed that the party leadership was genuinely determined to push through reforms limiting the ability of school operators to make profits. 

“I think this is for real, not fake,” he told The Local of the Social Democrats’ new vision of a profit-free school system. “I think schools minister Anna Ekström really wants to fight for this.”

The Confederation of Swedish Enterprise is against the idea.

“What the Social Democrats are proposing is in practice a ban on companies in this area. If efficient companies are not allowed to contribute to delivering welfare services, school, care and nursing will be both worse for users and more expensive for taxpayers. Additionally, freedom of choice will be abolished in practice,” the organisation’s CEO, Jan -Olof Jacke, told the TT newswire in a written statement.

Suhonen said that he was sure that companies would use every means at their disposal to stop the proposal becoming law. 

“These firms are run by greedy people, and I don’t think that they will be like nice guys if we regulate them or stop their business. So, we have to take that fight,” he said.  “The struggle will be hard and tough and long, but I think we actually taking baby steps to make a real difference on the ground, and I think this is good.” 

How would the proposals affect foreigners living in Sweden if they did come into effect? 

Many foreigners living in Sweden send their children to free schools, which include most international schools, and 27 percent of free school pupils have a foreign background. 

If the Social Democrats’ proposal to ban private companies from making profits on operating free schools succeeds, some of the country’s biggest chains, such as Internationella Engelska Skolan or AcadeMedia might be forced to close their schools. 

Many foreigners also use publicly funded but privately run healthcare providers, either physical primary care companies like Capio, or one of the new digital healthcare providers, such as Kry, or Min Doktor. 

What do the proposals mean for Swedish politics? 

Nicholas Aylott, an associate professor in politics at Södertörn University, said that it was hard to know for certain how seriously to take the proposals.   

“All political proposals are strategic, in some sense, and it’s always difficult to tell the difference between the purely strategic and the purely sincere,” he said. “But I’m sure a lot of Social Democrats feel very strongly about this.” 

He said he thought there were three reasons why the party was suddenly releasing eye-catching policy proposals: the threat from a newly assertive Left Party; the likely arrival of Magdalena Andersson as party leader and prime minister; and a shift in the political climate around privately provided welfare and education. 

“It’s not very difficult to interpret this latest gambit from the Social Democrats as some sort of response to the successful manoeuvre of the Left Party just a few months ago,” he said. “The second thing, of course, is that we’re about to have a change of guard in the Social Democrats.” 

He said that under Prime Minister Stefan Löfven, the party had appeared to have “no political agenda whatsoever” beyond staying in power, and that this now seemed like it was about to change. 

Finally, Aylott pointed to growing signs that even the government’s support party, the Centre Party, was weakening in its traditional support for private sector involvement in education, health and welfare. 

“I get the feeling that the whole debate about private actors delivering welfare services has moved on a bit in the last year or two,” he said. “It may just that the Social Democrats now see a realistic chance of moving public policy towards this sort of position without meeting an immovable object in the shape of the Centre party.” 

Suhonen pointed out that a public opinion survey carried out by his think tank, Katalys, had shown that a large majority of the public was now opposed to profit-making in the school sector, including a majority of Centre Party voters. 

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POLITICS IN SWEDEN

OPINION: Is Sweden complacent about social media influence of the radical-right?

With the think tank linked to the Sweden Democrats openly recruiting the next generation of far-right social media 'influencers', why is Sweden so complacent about moves to shift public opinion to the radical right, asks The Local's Nordic editor Richard Orange.

OPINION: Is Sweden complacent about social media influence of the radical-right?

The radical right in Sweden is at least open about what it’s trying to do.

The homepage of Oikos, the think tank set up by Mattias Karlsson, the former right-hand man of Jimmie Åkesson, leader of the Sweden Democrats, is currently recruiting the first 15 of “a new generation” of “conservative” online propagandists. 

The think tank – whose controlling foundation has been criticised for refusing to reveal the true origin of 5 million kronor in funding – this week launched its new Illustra Academy, which aims to train an army of young, far-right “creators” to help win over minds on YouTube, Instagram, and TikTok. 

Successful applicants, it promises, will get the chance “to meet leading actors in social media and digital political influencing”.

They will get “mentorship from established political influencers”, build “valuable contacts with influencers, digital opinion-makers, creatives, politicians and possible future employers”, and meet “businesses, political organisations, communications agencies and media actors”. 

This programme is being set up by Andreas Palmlöv, one of the many top Sweden Democrats who went to the US after Donald Trump was elected president to work for an increasingly radicalised Republican Party, serving as an intern for the former Speaker of Congress Kevin McCarthy.

After his return to Sweden, Palmlöv was photographed meeting Gregg Keller, a US lobbyist he says he met through the Leadership Institute, an organisation backed by a who’s who of US billionaire donors which has over the past ten years spent 8 million kronor training up young “conservatives” in Europe.

Karlsson, Åkesson’s former right-hand man, has even closer links to the US, holding at least one meeting with Steve Bannon, Trump’s former strategist, and attending the wedding of the pro-Trump US conservative media profile Candace Owens in 2019.   

As a British citizen, I’m perhaps overly sensitive about the influence of conservative, libertarian donors and their think tanks, and of the efforts to use social media to push public opinion towards the radical right. 

Vote Leave, which led the campaign for the UK to leave the European Union, started its life at 55 Tufton Street, the townhouse near the UK Parliament where the country’s most powerful “dark money” think tanks are based, while Matthew Elliot, its chief executive, was a Tufton Street veteran. 

Since the UK left the EU, the ruling Conservative Party has been increasingly captured by these think tanks and their wealthy backers.   

Ministers, former ministers and Conservative MPs now happily speak alongside radical right figures at lavish conferences like the National Conservatism UK conference part-funded by Christian pro-Trump US foundations, or the Alliance for Responsible Citizenship conference part-funded by Paul Marshall and Christopher Chandler, the two billionaires who are the most open and prominent funders of attempts to shift the UK to the radical, libertarian right. 

Conservative MPs and former ministers have over the past two years been paid a total of £600,000 (8 million kronor) to appear on GB News, the Fox News clone jointly owned by Marshall and Chandler.

The Legatum Institute, Chandler’s own think tank, pretty much dictated the UK’s Brexit policy while Boris Johnson was prime minister, while during Liz Truss’s brief premiership, the Tufton Street think tanks supplied much of her team.

When her attempt to drive through their radical libertarian economic programme blew up spectacularly, she was forced to resign. But they haven’t given up, with Truss returning in February with the new Popular Conservatism group. 

I had always believed that the UK politics was immune to US levels of big donor influence, that the Conservative Party could never go the way of the Republican Party in the US, and it turns out I was wrong. 

So is that same naivety playing out in Sweden? 

The Oikos think tank has already started hosting international conservative conferences along the lines of ARC, with a conference at the Sundbyholms Slott castle outside Eskilstuna last year. 

When Social Democrat opposition leader Magdalena Andersson raised questions earlier this year about the funding of Henrik Jönsson, a popular YouTube debater, she was sharply criticised by commentators of both left and right for seeking to smear a critic without providing evidence

But in the US, there are billionaire-funded ‘educational’ YouTube channels like PragerU that follow a very similar format to Jönsson’s. Jönsson’s videos reliably follow the same talking points, questioning whether global warming is really causing extreme weather, spread disinformation about wind farms, call for Sweden’s public broadcasters to be abolished, and claim migrants have trashed the economy. 

And when a donor last year asked Gunnar Strömmer, now Sweden’s Justice Minister, how to give 350,000 kronor to the Moderates without having to identify himself under party financing laws, in part of a sting by TV4’s Kalla Fakta programme, Strömmer advised him to give it directly to right-wing “opinion-makers”, meaning, presumably, people like Jönsson. 

Despite the uproar, Jönsson has never explicitly denied receiving funding from outside organisations, only that such funding does not influence his output. 

“I am quite open about the fact that I willingly take money from all decent organisations and private individuals,” he told the Dagens ETC newspaper, while declining to give any further details. “But no one controls what I say,” he added. 

He has admitted that the website for his Energiupproret campaign, which blamed green policy and the shutdown of nuclear power stations for high power prices in the run-up to the 2022 election, was built by Näringslivets Mediaservice, a right wing social media outfit the precise funding of which was always unclear, although it was linked to Stiftelsen Svenskt Näringsliv, a foundation set up partly by the Confederation of Swedish Industry. 

The founders of Oikos’ new influencer education programme would probably argue that nothing is stopping the political left and centre from raising funds to train up young social media influencers in exactly the same way. 

Left-wing parties are not above taking donations. Approached by the same donor as part of the Kalla Fakta undercover report, representatives of the centre-left Social Democrats – as well as the Christian Democrats, Liberals, and Sweden Democrats on the right – also recommended ways around party finance laws.

But do we really want the UK or Sweden to follow the path the US has taken in recent decades, where a handful of billionaires with radical right opinions have aggressively pumped money into think tanks and media outfits and so succeeded in pushing one of the main parties towards previously fringe political opinions? 

It didn’t need to be this way.

When Sweden was developing its new party financing laws back in 2016, experts warned the then government must not to allow the identity of donors to be hidden behind foundations, the key method used by so-called dark money in the US, but the loophole was left open by the law.

It’s not just Oikos, which is funded by an opaque foundation, Insamlingsstiftelsen för Svensk Konservatism (The Fundraising Foundation for Swedish Conservatism), which uses this loophole. 

When caught in the sting by the Kalla Fakta programme, a Social Democrat also suggested that the donor set up a foundation to hide their identity. 

It may be that money from US billionaires, big companies, or indeed from other states, is not yet being spent in Sweden in a way that can alter the political landscape, but because neither think tanks nor influencers need to give much information about who funds them, it’s impossible to know. 

In the UK, the danger may soon be averted. No one seems to take the new outfit fronted by Liz Truss too seriously, and the general election later this year should offer the chance to clean up the country’s politics.  

Nonetheless, I feel like I’ve come very close to losing my original homeland to the kind of political developments seen in the US. I don’t want to lose my adopted country too.

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