The Economy Report, May 2017

The demographic trend we see ahead of us, fewer people of working age in relation to young and old, is a major challenge if costs are not to rise much faster than revenue. Moreover, the present economic boom in Sweden is expected to burst resulting in lower tax base growth.

So, long-term solutions must be found. Historically great efficiency gains have been related to new technology in combination with changes in ways of working. The advances made in recent years in digitalisation point to a revolution that can change how local government tasks as providers of welfare services can be solved. Is the public sector in Sweden capable of making that transition? The alternatives are much worse.