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A foreigner’s guide to understanding Norwegian politics in five minutes

Norway’s political system, with its many parties and proportional representation voting system, can be a little confusing for international residents to get their heads around. Here’s a quick guide to help you understand how it works. 

Published: 9 December 2022 16:14 CET
Pictured is Norwegian PM Jonas Gahr Støre
Here's what you need to know to get you up to speeds with the basics of Norwegian politics. Pictured is the current Norwegian PM Jonas Gahr Støre. Photo by Vesa Moilanen / Lehtikuva / AFP

Trying to get to grips with the idiosyncrasies of a political system can be confusing. However, it is crucial as it goes someway to helping you understand the debates, decisions and rules which will shape your life in the country. 

It can be easy to get lost in Norway’s political system due to its strange voting system and numerous parties. Therefore, we’ve put together a quick guide to get you up to speed with the basics. 

Parliament and elections

Norway’s parliament, the Storting, is comprised of 169 MPs who represent 19 constituencies based on former counties. Each constituency elects between four and 20 MPs. The number of MPs representing an area depends on its size and population. 

This is done to ensure that rural areas are slightly overrepresented so that policy isn’t solely formulated around the big cities. Certain parties like the Centre Party, which focuses on decentralisation, farming and rural communities, are said to benefit from this. 

Parliaments are elected in national general elections every four years. The next election in Norway will be held in 2025. Those turning 18 on the year the election is held can vote, and only citizens can participate in general elections. 

Voting works on a proportional representation system. Essentially this means the model tries to ensure the parties with the most votes get the most seats. The belief is that this is fairer than a ‘winner takes all system’ like first past the post in which the party with the most seats secures full representation in parliament. 

The Norwegian model includes levelling seats via the sperregrense (barrier limit) system. This is a threshold which awards extra seats to parties that secure more than four percent of the total vote. This is to ensure that parties that receive nationwide support are fairly represented and to stop too many parties from entering parliament. 

One final thing to note is that Norway is a single-chamber system, meaning there isn’t an additional house, like the House of Lords in the UK. 

Government and parties

A multi-party system is in place in the Nordic country. Due to the large number of parties, it is improbable that a single party secures enough seats to form a government. Instead, both minority and majority coalitions are formed. 

The current government is a minority coalition formed by the Labour Party and Centre Party. The Labour-led government, with the leader of the party, Jonas Gahr Støre, also being PM, typically works with the Socialist Left Party on crucial policy proposals and the state budget to secure a parliamentary majority. 

This majority ensures that policy passes through parliament and can become law and legislation. However, the presence of the minority government also means policy proposals can change, and negotiations can drag on for weeks. 

For example, nearly two months passed between the budget being announced and a deal being agreed upon. In addition, the Socialist Left Party credits itself for seeing energy support in Norway raised from 50 percent when the price rises above 70 øre per kilowatt hour to 80 percent. Since then, the support has been increased to 90 percent. 

There are nine mainstream political parties in Norway. Below we’ll give you a (very) basic overview of them all. 

Labour Party (Arbeiderpartiet): The social democratic, centre-left party has historically been Norway’s largest. They are currently in government, and their leader is Jonas Gahr Støre, Norway’s PM. Throughout 2022, Labour and its government partner, the Centre Party, have struggled in the polls. 

Conservative Party (Høyre): Norway’s second-largest party leans to the right of the centre and is ideologically focused on Liberal Conservatism. They were toppled in the previous election, but leader Erna Solberg remains a popular choice with voters. 

Centre Party (Senterpartiet): The party has roots in the Peasant Movement. It was initially called the Farmer’s Party and is still focused on Agrarianism (rural and farming issues). It sits reasonably centrally on the political spectrum but is heavily opposed to Norway’s membership of the EEA and any potential membership of the EU. Its leader is the current Minister of Finance, Trygve Slagsvold Vedum. 

Progress Party (Fremskrittspartiet): This party sits on the furthest right of Norwegian politics and could be described as a populist, nationalist or liberal-conservative party. The party is one of the more junior ones (in terms of age) and is heavily positioned against immigration. It left the previous government over the repatriation of a former IS bride. 

Socialist Left Party (Sosialistisk Venstreparti): The left-wing, democratic socialist party is the government’s preferred negotiating partner. Its current leader, Audun Lysbakken, will step down in 2023. 

Red Party (Rødt):This is the party to the furthest left of Norwegian politics. The party was founded in 2007 and is headed up by Bjørnar Moxnes. In 2021 the party delivered its best-ever election results and, like the Progress Party, is opposed to the EU. 

Liberal Party (Venstre): Despite being called “Left” in Norwegian, they actually sits to the centre of Norwegian politics. They formed part of the 2017 government that was ousted in 2021. Their leader is Guri Melby, and the party subscribes to social liberalism. 

Green Party (Miljøpartiet de Grønne): Is focused on green politics. Ideologically they sit to the centre-left of Norwegian politics. The party opposes itself to the biggest left and right-wing parties. The party has taken the position of refusing to sit in government with any party that will continue to drill for oil and gas in the North Sea. Its newly elected leader is Arild Hermstad.

Christian Democratic Party (Kristelig Folkeparti): The Christian Democratic Party sits to the centre-right of Norwegian politics and was part of the previous centre-right government. Its current leader Olaug Bollestad took over after the previous leader stepped down over a commuter housing and tax scandal. 

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TAXES

Will Norway’s new exit tax slow the exodus of ultra-rich from the country?

You can check out -- but you still have to pay! Norway is looking for ways to hang onto its ultra-rich who are increasingly moving abroad to escape one of the rare European countries to impose a wealth tax.

Published: 24 May 2024 10:55 CEST
Will Norway's new exit tax slow the exodus of ultra-rich from the country?

Industrialist Kjell Inge Røkke, former cross-country ski legend Bjørn Dæhlie, and the father of football star Erling Haaland are among the dozens of super-wealthy who have packed up and left in recent years.

The reason? The centre-left government in power since 2021 has hiked the wealth tax from 0.85 percent to one percent — and to 1.1 percent for the very wealthiest — and raised the dividend tax.

Norway, Spain and Switzerland are the only European countries that have a tax on net wealth. In Norway it also applies to unrealised capital gains (gains not yet realised through the sale of shares, for example).

Owners of companies are among those hit hardest, often drawing a modest salary even though their company has a high value.

“If your salary is one million and you have to pay three million in (wealth) tax, it’s clear that it’s untenable,” said Tord Ueland Kolstad, a real estate magnate who “grudgingly” moved to Lucerne, Switzerland in 2022.

“The system is designed so that it confiscates more than what you can produce,” he said.

To pay a wealth tax which can exceed their yearly income, entrepreneurs often need to take out dividends, hampering their company’s capacity to invest.

And those dividends are also subject to a tax rate of 37.84 percent.

“So basically you have two options: either leave Norway, or sell your company,” said Kolstad.

‘Breach of the social contract’ 

Between 2021 and 2023, more than 100 of Norway’s wealthiest people went into exile, with the large majority relocating to Switzerland.

Others transferred their wealth to heirs already residing abroad, as Norway does not have inheritance tax.

Labour Prime Minister Jonas Gahr Støre has criticised the mini-exodus, stressing that taxes are what pay for Norway’s generous welfare system.

“When you’ve made your wealth in Norway, put your kids in school, benefitted from the health care system, driven on the roads and reaped the rewards of its research, it’s a breach of the social contract,” he said in a speech in parliament.

The government is now working to tighten the country’s “exit tax”.

People who move abroad would have 12 years to pay the exit tax — also 37.84 percent of gains made in Norway from shares and other sources over many years — that has until now been easy to circumvent or defer.

“The aim is that gains made in Norway be taxed in Norway,” explained Erlend Grimstad, a state secretary in the finance ministry.

“Our nurses and teachers have to hand over a large share of their earnings to society in the form of taxes,” he said.

“If they see that the most well-off can simply avoid contributing their share by leaving the country, that undermines the legitimacy of the tax system.”

‘Don’t come to Norway’

That does little to quell the anger of the ultra-rich.

Christer Dalsbøe, who started his own company, made buzz on social media recently singing a little ditty discouraging other entrepreneurs from starting businesses in the country.

“Don’t come to Norway, We will tax you till you’re poor. And when you have nothing left, We will tax you a little more,” he sang, sitting at a piano.

The liberal think tank Civita said the government’s plans to tighten the “exit tax” were in reality aimed at setting up roadblocks for millionaires and billionaires.

“Instead of attacking the reasons that push them into exile, meaning easing the tax burden on Norwegian shareholders, they seem to prefer to set up regulatory obstacles,” said Civita economist Mathilde Fasting.

In Lucerne, Tord Ueland Kolstad said he can receive “several calls a week” from other Norwegians considering moving to Switzerland.

“The flow has not stopped. Maybe it is just beginning.”

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