Rising inflation and rampant energy prices have hit Sweden hard in the past six months.
And it is predicted to be tougher.
Annika Wallenskog, chief economist at Sweden's municipalities and regions (SKR), says ahead of tonight's Agenda that major cost increases await the country's regions and municipalities.
- The absolute biggest challenge is the high cost increases we see going forward.
We see that the own contractual pensions in municipalities and regions will be approximately NOK 40 billion higher next year than they are this year, she says.
Annika Wallenskog points out that pension costs will be even slightly higher in 2024.
- And that means that it will be really tough, because we see pensions increasing.
"The case moves incredibly quickly"
She emphasizes that other costs will also increase, such as snow removal, IT costs, maintenance of parks and roads and cleaning - items that are all based on contracts where there is an index.
Indexes increase in different ways in line with inflation.
- This case is moving incredibly quickly, I have never witnessed such a rapid change in the economy ever.
From very strong results from 2020 and 2021 to this huge deterioration in results, she says.
- And then we still haven't counted on high salary increase costs.
According to Wallenskog, there are currently more downside risks - that is, risks that things will get worse than there are hopes that things can get better.