1. Questions for the national reports:

1. Are there major public service reforms taking place? If yes, in which areas? (e.g., healthcare, public utilities, public transport, education)?

It is difficult to maintain that there are major public reforms taking place. In Iceland we have had a conservative/center coalition government since 1992, which has had privtization and “reform” of the public sector on the agenda all the time. Between 1992 and 2005 some 44 public companies (wholly or partially owned by the state) have been privatized, including the three main banks and the telephone company. Now they say they say they have had a change in policy; i.e. they only want to revert public companies into limited companies, while the State will retain the only share that will be published. BSRB the Federation of State and Municipal Employees, has a always maintained that the transformation of a public company into a share holding company, has only been the first step into full privatization and so far we have unfortunately been proved to be right. But time will tell if the latest transformations of the Civil Aviation Authorities into a limited co with the State owning the only share, will be a permanent result. The same fate waites RÚV, The Public Broadcasting Service. Last winter Althingi (Parliament) agreed new laws on “public limited companies” which could have been a fruitful way to proceed, but unfortunately they only differ from ordinary limited companies in minor details.

Outsourcing and PPP’s is a continuing development, both for the state sector and the municipalities.

As for the core-services, the healthsector, education, social services etc. they are still mostly in the hands of public authorities. But inroads have been made both with private healthclinics specializing in certain procedures, and you find both private kindergardens, primary, secondary and tertiary schools as well as private homes for the elderly. All recieve subsidies from the state. Without further resistance and change in attitude, this trend is set to develop further, even though no major plans in that direction have been reveiled yet. Yet there has been introduced a draft on a bill on the healthservice which opens up avenues for private operators. Instead of “offering the best possible healthservice” now the aim is for “quality and efficiency” and the draft is riddled with “marketing-jargon” instead of beeing public service minded.

The energy sector has undergone a major change since the implementation of the EU Energy directives in Iceland, and there has been a big fight over the rights over water. BSRB launcehed a big campaign in coalition with other trade unions and ngo’s to try to stopp a bill dictating that ownership of land gives the owner a sole private ownership of the water that might come from the land. The bill was passed, but with the contingency that it will not be activated as law until after the next elections to parliament (May 2007).

2. What effects are they having on the financing, organisation, and quality of services?

By tranforming a public company into a limited company a few things tend to happen: The companies are no longer subject to Public Information Act - so transparency disappears - as well as direct accountability. Firms immediately start to act like they are a private business. Employees stop beeing public employees and loose their rights as such. Unless otherweis stated services stop beeing universal, and equal access, affordability and consumer protection stop being a concern of the state - market rules and dynamics apply. Concertation concerning the transformation of a public firm into a limited company is usually very thin on the ground and then usually only directed at issues directly concerning the change in employment and related right (or loss of rights). If a public firm is privatized the firm looses state garantee on its financial obligations and financial costs go up - hence service becomes more expensive.

3. Are any further reforms planned?

There are bills in the pipelines on The Public Radio, the coast guard, the health service, on research institutes in the food, agricultural, marine, indurstrial and environmental sector. All aim at changing the above mentioned public institutes/companies wholly or partly into public limited companies.

4. What are the key policy demands of organisations representing social partners, local government, NGOs, consumer organisations?

Unfortunatly there are very few ngo’s or social partners or others in Iceland, apart from BSRB, who have raised concerns on this general level, i.e. public vs. private. Remarks and objections/complains have been more on specific instances. Still surveys show that the public opinion has been very much against the privatization of certain companies and institudes and that the public has a positive relation to public services. And there is one exemption from the piece-meal approach, which is the campaign BSRB lauched last year on water. There we managed to unite the trade unions, the ngos on environment, human rights etc, the curch and other on the issue of water - and the need for water to remain in the public domain. I think we will definately be able to bank on that experience.

Please give one or two examples of positive and negative reforms, using the principles set our in Annex 1(3) as a benchmark for the “quality” of service.

Detailed examples will be provided later, if relevant.

Páll H. Hannesson, national coordinator, Iceland.