Arne O. Holm says Bonus Binge in Statkraft the Size of Finnmark’s Entire Tax Revenue
Christian Rynning-Tønnesen has been CEO of Statkraft since 2010. Statkraft is Europe's largest generator of renewable energy, as well as Norway's largest and the Nordic region's third largest energy producer. (Photo: Statkraft)
Commentary: State-owned Statkraft has paid its employees NOK 1,8 billion in bonuses. Far enough to cover the tax revenues of all municipalities in Finnmark in Northern Norway. If we add the bonuses in DNB and Petter Stordalen's tax-free dividends to the mix, we will be on target with good margins.
Such good margins that we also have acquired coverage for the tax revenues going directly to Finnmark.
There are 20 municipalities in Finnmark, the Northern Norwegian region bordering Russia. They have a lot in common, including a strained municipal economy. Even Hammerfest, the foundation of the Norwegian gas export, is teetering on the brink of being put under state control.
So demanding
If I sum up the direct tax income of these 20 municipalities, I end up with NOK 2,5 billion. This sum is supposed to cover several statutory responsibilities, such as education, childcare, social assistance, child protection services, medical care, and nursing homes. Demanding tasks within an economic framework is a source of headaches in every single municipality. Schools are closed, doctors' offices are empty, and child protection services lack resources.
I do not know what needs the bonus payment of NOK 1,8 billion to Statkraft employees is supposed to cover, but there must be something. Last year, when the energy prices were at their highest, the payments to so-called "other benefits" in Statkraft amounted to NOK 2,2 billion. If I add the bonus payments in 2021 of NOK 920 million, the employees of Statkraft have had their needs covered by about NOK 5 billion in the past three years.
In addition to salaries.
Five billion to personal needs.
However, bonuses are not only the result of high energy prices, which, given the size of the reward, are obviously demanding to handle.
Hard to keep interest rates down
Low interest rates and high lending rates also require special management efforts. DNB, Norway's biggest bank, had a profit of NOK 40 billion after taxes, or 16 times the tax revenues of Finnmark.
Bonuses also abound, on top of high salaries, and the total amount is about NOK 198 million, or two-thirds of the tax income of Sør-Varanger municipality, on the border with Russia.
These days, Hotel King Petter Stordalen's presence is required in the Oslo district court. He has received a tax-free dividend of NOK 800 million from one of his companies, and if the court approves, he could continue with tax-free dividends for a long time to come. The tax-free dividend is greater than the income tax of Alta municipality, a city of almost 20,000 inhabitants.
Why these comparisons?
About to divide the country in two.
Firstly, because an ongoing debate is currently discussing how the population figures in the North, not least because of security policy reasons, are to be stabilized or even increase in the face of the Russian threat.
Secondly, because the differences between the North and the South are about to divide the country in two.
Salaries are an important driving force for most people. Salary recipients also have no opportunity for tax planning, and there is little to no reward for putting on a uniform and defending the border against the East. New statistics show that the average paycheck in Nordland county is NOK 40,000 lower than the national average. I do not know recent figures from Finnmark, but the difference is unlikely to be smaller. Measured against Oslo, the average paycheck in the North is NOK 230,000 lower per year.
A reasonable demand
If the state-owned Statkraft, instead of rewarding its employees bonuses, had payed its profits to the state, we could easily have removed both the county and municipal taxes in Finnmark. The net salary would still be lower than in Oslo, but it might have helped halt the population flow southward. We are unlikely to succeed in luring the bonus grafters in the banking and energy sector northward anyway.
More fun to scare Oslo people.
It will probably always be more fun to scare half of Oslo with private fireworks for property baron Christian Ringnes' 70th birthday than to fire off rockets on the Finnmark plains.
In the North, we could score some demagogic points from those who aggressively defend salary and bonus development, which threatens to undermine the harmonious image of Norway.
"We must be competitive but not wage-leading," the bosses tell the bonus hunters, whether they work in a state-owned company or a company looking for state subsidies.
A reasonable demand, perhaps, also from us who live in the North.
