This is the third report assessing the implementation of the Charter in Norway since the country ratified the Charter in 1989.
The rapporteurs conclude that the country’s system of local self-government works well and that the obligations of the Charter are generally fulfilled.
The rapporteurs note with satisfaction the incorporation of the principles of local democracy and
self-government in the Constitution and specific legislation, together with the introduction of judicial remedies for local authorities against decisions taken by the State administration. Likewise, they note a more thorough regulation of the State supervision of local authorities, and a satisfactory level of local democracy thanks to the extensive powers and financial resources of counties and municipalities.
However, as the report points out, there are several issues that deserve specific attention.
In particular, the process of consulting local communities on changes to local authorities’ boundaries remains unclear. The rapporteurs also note that the degree of supervision by the government over local authorities remains pervasive, to a certain extent due to legislation that is too dense and specific, particularly in the field of welfare, not leaving sufficient discretion to the local authorities.
Therefore, the report provides a series of recommendations to the national authorities to further increase the already high level degree of compliance with the Charter. These include strengthening local self-government by avoiding legislation that is too dense and specific and clarifying the procedure of consultation of local communities in the changes of local authorities’ boundaries. The rapporteurs also recommend clarifying the scope of the State supervision of local self-government so that it remains proportionate to the interests it seeks to protect.
The principle of local self government shall be recognised in domestic legislation, and where practicable in the constitution.
Article 2 requires the principle of local self-government to be recognized at domestic level in an ‘open’ and ‘express’ manner, i.e., in written law. The practical and operational consequences of this recognition can be fully understood in the light of Article 11, according to which “the principles of local self-government as are enshrined in the constitution or domestic legislation” shall be protected by judicial remedies that local authorities can activate. Therefore, the written principles represent the standards for court’s ruling on the recourses submitted by local authorities against acts infringing their local autonomy.
In Norway, the principle of local democracy is guaranteed under the Norwegian Constitution. In 2016, anew paragraph 2 was added to Article 49 of the Constitution, stating that: “The citizens have the right to govern local affairs through local democratically elected bodies. Specific provisions regarding the local democratically elected level shall be laid down by law”.
As KS pointed out during the meeting with the delegation, thelegal significance the constitutional provision will have in Norwegian law, and how the content of the provision should be understood in more detail, has not been clarified in case law. There is a very limited number of cases before the courts where this problem comes to the fore.
As for the legislation, in 2018, the self-government of the municipalities and counties received a clearer legal anchoring in the new Local Government Act. It became statutory law that municipalities and county authorities have their own elected leadership, are their own legal subjects that restrictions on self-government must be based on law and that self-government is negatively limited, i.e., that self-government has the right of initiative and can take on tasks that have not been given to others by law.
For these reasons, the rapporteurs conclude that the requirements of Article 2 of the Charter are complied with in Norway.
Local self-government denotes the right and the ability of local authorities, within the limits of the law, to regulate and manage a substantial share of public affairs under their own responsibility and in the interests of the local population.
The main question that must be addressed under this heading is whether, in the present situation, Norwegian local authorities regulate and manage a “substantial share of public affairs under their own responsibility and in the interests of the local population”. This provision requires an assessment which takes into account the rather “subjective” and relative nature of such concepts as “ability”, “a substantial share of public affairs”, “under their own responsibility” and “in the interests of the local population” since no official or universal method of measuring such substantial character has yet been developed. The question must be addressed considering the historical evolution, the culture and the constitutional traditions of the country under analysis. It is also closely linked to the assessment of the compliance with other parts of the Charter, such as Articles 4, 8 and 9.
In order to assess compliance with this provision, both legislative and factual aspects should be taken into consideration.
In Norway, according to the OECD data,[45] subnational governments accounted for a third of general government expenditure in 2020, and for 18.6% of GDP. Subnational governments are also a major employer, since the municipalities and counties are responsible for more than half of public staff expenditure, and staff expenditure representing half of total subnational government expenditure, one of the highest shares among OECD.
Following the Nordic tradition, the local public sector in Norway is a major provider of welfare services,[46] which explains why education, health and social sectors account for the bulk of subnational government expenditure. The most important budget item is social protection, which accounted for 5.1% of GDP (a level well above the OECD average of 2.2% of GDP) and almost 29% of subnational government expenditure (also well above the OECD average of 14.1%). As far as education is concerned, Norway is in line with the OECD average both as a share of GDP (3.9% of GDP in the OECD in 2019) and as a share of subnational government spending (24.3%). Despite the fact that hospitals are under central government, health is an important subnational expenditure sector, accounting for 2.4% of GDP and 13.7% of subnational government expenditure. Subnational governments are responsible for more than 27% of the general government expenditure in this area. Finally, subnational governments are active in economic affairs and transport, especially since they hold the responsibility of local roads maintenance, however, it remains a smaller share in subnational government spending relative to the OECD average (13.6% in 2019) and as a share of the GDP (2.2%).
At factual level, we could mention the Local autonomy Index (LAI) countyranking 2014, considering Norway in the top group among European countries.
Local autonomy Index (LAI) countyranking 2014
Source: Ladner/Keuffer/Baldersheim/Hlepas/Swianiewicz/Navarro,Patterns of Local Autonomy in Europe, 2019, New York, Palgrave MacMillan, p. 236
This position has been strengthened by the constitutional and legislative reform.
This right shall be exercised by councils or assemblies composed of members freely elected by secret ballot on the basis of direct, equal, universal suffrage, and which may possess executive organs responsible to them. This provision shall in no way affect recourse to assemblies of citizens, referendums or any other form of direct citizen participation where it is permitted by statute.
Article 3.2 is the main statement of the democratic principle in the provisions of the Charter. The right of self-government must be exercised by democratically constituted authorities. The concept of local autonomy does not involve the mere transfer of powers and responsibilities from central to local authorities but also requires local government to express, directly or indirectly, the will of the local population.
In Norway, municipalities are governed by a council which is elected by the local citizens every 4 years in fair and free elections. Executive bodies are elected by the council and are accountable to the council. Norway, as other Nordic countries, is at the very top of several democracy indices, thanks to high scores on electoral process and pluralism, political culture and political participation.[47] Voter turnout increased significantly in the 2019 local elections, with the largest increase among young people. Surveys show that citizens prefer elected representatives in their own municipal councils as a channel to promote their interests.[48]
Therefore, the rapporteurs consider that Article 3, paragraph 2 is respected in Norway.
The basic powers and responsibilities of local authorities shall be prescribed by the constitution or by statute. However, this provision shall not prevent the attribution to local authorities of powers and responsibilities for specific purposes in accordance with the law.
Article 4, paragraph 1, of the Charter requires that the basic powers and responsibilities of local authorities are prescribed by the constitution or by statute, so as to ensure predictability, permanence and protection for the benefit of local self-government. Therefore, the tasks of local authorities should not be assigned on an ad hoc basis and should be properly enshrined in written parliamentary legislation. Establishing local powers and competences by means of administrative regulation should be avoided and goes against the spirit of the Charter.[49]
In Norway, the municipalities and counties’ competences are set out in a range of sectoral legislation. They include, as said above, preschool child day-care facilities and child welfare services, primary and lower secondary schools, primary health care, care for the elderly and disabled, financial support for welfare clients, church maintenance and cultural affairs (public libraries, etc.), fire protection, municipal roads and harbors, water supply and sewage services, garbage collection and disposal, local land use planning and environmental issues, upper secondary schools, dental services, county roads and public transport, county land use planning , regional development.
Source: Technical Calculation Committee for Municipal and County Economics (Nov. 2022) at https://www.regjeringen.no/no/dokumenter/rapport-fra-det-tekniske-beregningsutvalg-for-kommunal-og-fylkeskommunal-okonomi-november-2022/id2948377/
Therefore, it appears to the rapporteurs that Article 4, paragraph 1, is respected in Norway.
Local authorities shall, within the limits of the law, have full discretion to exercise their initiative with regard to any matter which is not excluded from their competence nor assigned to any other authority.
According to Article 4, paragraph 2, local authorities must have the right to exercise their initiative on matters not explicitly excluded from their competence by law. In addition, they must have “full discretion to exercise their initiative”. Restrictions on local bodies’ full discretion can also stem from management, fiscal and budgeting rules that require a sound legal basis for spending.[50]
In Norway, the Local Government Act confirmed the traditional position of Norwegian local government: municipalities may take on any functions not undertaken by other public bodies (in practice State bodies or county councils); this is also a long-standing historical tradition. In addition, a series of special acts makes specific functions mandatory for local government, e.g., education, kindergartens, land use planning, etc.
However, in 2021, the Supreme Court dealt with the question of whether Trondheim municipality could limit the use of electric scooters, based on the municipality's property rights.[51] The municipality wished to achieve this by requiring that rental companies that wished to rent out electric scooters on the municipality's property must participate in a tender to be able to put out electric scooters on the municipality's property. The municipality was the owner of the majority of Trondheim city centre. In this way, the municipality wanted to regulate the scope and use of the rental of electric scooters. The Supreme Court came to the conclusion that such use of property rights according to Article 113 of the Constitution was an "intervention" that required legal authority. The Parliament adopted a law that gave such specific authority in June 2021.[52]
During the meetings, the question was raised as to whether, and also which, limitations apply to the municipality's right to use property rights to promote political or socially beneficial purposes; a question which could be answered only by future case-law.
Therefore, the rapporteurs consider that Article 4 paragraph 2 of the Charter is respected in Norway.
Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. Allocation of responsibility to another authority should weigh up the extent and nature of the task and requirements of efficiency and economy.
Article 4, paragraph 3 of the Charter articulates the general principle of subsidiarity. It establishes that “Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. Allocation of responsibility to another authority should weigh up the extent and nature of the task and requirements of efficiency and economy”.
In Norway, the principle of subsidiarity in entrenched in Article 2-2 of the Local Government Act, according to which “Public duties should preferably be assigned to the administrative level closest to the inhabitants”.
Therefore, the rapporteurs consider that Article 4 paragraph 3 of the Charter is respected in Norway.
Powers given to local authorities shall normally be full and exclusive. They may not be undermined or limited by another, central or regional, authority except as provided for by the law.
Article 4, paragraph 4, provides that “Powers given to local authorities shall normally be full and exclusive. They may not be undermined or limited by another, central or regional, authority except as provided for by the law”. The law may certainly introduce limitations on the powers given to local authorities, but such limitations should be exceptional, based on objective reasons and interpreted narrowly. In addition, overlapping responsibilities can become a threat to local autonomy.[53]
In Norway, local authorities are responsible for most of the social services, in a system where central government (and Parliament) has the overall responsibility for an equal and sufficient distribution of services all over the territory. In combination with their important share of overall public spending and their general dependence of the transfer of State money, this inevitably creates a level of tension between the ideal of local self-government and the real freedom of choice enjoyed by the municipalities.
The increase in statutory provisions of individual rights results, according to many researchers, in disproportionately large restrictions on the municipalities' scope of action. In addition, particularly in the areas of welfare, there are tendencies towards more detailed management through, among other things, requirements in law and regulations relating to procedures, documentation, competence and staffing standards. A 2015 report from the Norwegian Directorate of Public Administration (DIFI) illustrates the growing complexity of State regulation of local government. The report covers just three policy fields (education, health and caring, and environmental protection). In the three fields combined, local government operations were in 2015 regulated through 22 different acts of Parliament filled out
by 102 government directives. On top of that, 29 handbooks were issued to guide local personnel in the performance of their daily duties.[54]
KS provided several examples in the Education Act, the Health and Care Services Act, the Child Protection Act etc. From 2017 there is a requirement for specialization in general medicine for newly appointed doctors in the municipal health and care service and from 2018 new competence requirements apply to emergencies doctors. From 2014, new competence requirements have been introduced for teaching certain subjects (Norwegian, mathematics, English and Sami) in basic education. From 2018, the pedagogic norm has been tightened (by regulation) in kindergarten. From a maximum of 18 children over the age of three per educational leader, to a maximum of 14 children. For children under the age of three, there must be a maximum of seven children per educational leader, compared to the current nine children.
Rapporteurs consider that the protection of rights of the citizens is an important and unavoidable task of the public sector. However, this cannot automatically imply a detailed and dense regulation, that does not leave discretion to the local authorities, also translating into pervasive standard for supervision.
Therefore, the rapporteurs consider that Article 4, paragraph 4, is partially respected in Norway.
Where powers are delegated to them by a central or regional authority, local authorities shall, insofar as possible, be allowed discretion in adapting their exercise to local conditions.
Article 4, paragraph 5, refers to delegated responsibilities, establishing that local authorities shall, insofar as possible, be allowed discretion in adapting their exercise to local conditions. The delegation of powers between different levels of government is a long-standing tradition in many European States. Central government benefits from the territorial network formed by local and regional authorities: they are closer to citizens and offer local knowledge, they reflect local conditions and provide economies of scale. Local bodies and services therefore discharge delegated functions on behalf of higher-level authorities, most commonly on behalf of the State.[55]
Both during the visit and the consultation procedure, no issues have been raised by the interlocutors on the delegationof competences, which appears to satisfy the requirements of this article in practice.
Therefore, the rapporteurs consider Article 4, paragraph 5 is respected in Norway.
Local authorities shall be consulted, insofar as possible, in due time and in an appropriate way in the planning and decision-making processes for all matters which concern them directly.
Article 4 para. 6 of the Charter provides that “local authorities shall be consulted, insofar as possible, in due time and in an appropriate way in the planning and decision?making processes for all matters which concern them directly”.
Consultation is a key principle of the Charter. The Charter does not define or prescribe the forms of consultation or substantially regulate the consultation process. Since its basic function is to establish the general approach and framework for consultations, it may be concluded that the main process of consultation is dependent on three basic conditions: (a) local authorities should be able to obtain full information on decisions and policies that concern them directly, and this information should be available at the initial stage of the decision-making process; (b) local authorities should have the possibility of expressing their opinion on decisions and policies before these become legally binding documents; and (c) local authorities should have the time and ability to prepare recommendations or alternative drafts and submit them for consideration.[56]
In Norway, consultation with KS is an integral part of the local self-government system.
As pointed out by KS in the written answers to the rapporteurs, the consultation scheme between the government and KS is a formalised arena for dialogue and collaboration on frameworks and goal achievement for the local government sector. The meetings involve stakeholders from top political levels from both parties.
As see above, KS and the government have a formalised consultation scheme for dialogue and cooperation. This includes high-level meetings, bilateral cooperation agreements and KS involvement in cost estimations. The main meetings include one in the spring before the Ministry of Local Government, the Ministry of Finance and KS consult on next year's budgetary framework for municipalities; another with all relevant ministries before the revised national budget and annual local government bill; and another series of meetings in the autumn with relevant ministries. A 30-page guide sets out procedures for these meetings and for involvement of KS in cost estimations, legislative enquiries, etc.[57]
The Parliament does not have such procedures. However, the delegation was informed that when the committees arrange public hearings, KS normally has the opportunity to be present.
Therefore, the rapporteurs consider Article 4, paragraph 6, is complied with in Norway.
Changes in local authority boundaries shall not be made without prior consultation of the local communities concerned, possibly by means of a referendum where this is permitted by statute.
This article requires that local communities should be consulted in case of changes of local authorities’ boundaries. It is therefore a mandatory procedural requirement that no change in local boundaries may be adopted without consultation, which must take place at a timely stage before a final decision on the matter is made. Consequently, a boundary change carried out without consulting the local community would be in breach of Article 5.[58]
In Norway, the Local Government Boundaries Act[59] establishes that the Parliament decides on the merger of the counties, while the government decides on the merger of municipalities, among other things. Article 9 establishes that, “Before a decision is made on boundary changes or boundary fixing, the municipalities or county municipalities concerned must be allowed to express themselves. In matters of amalgamation or division, the municipal council or the county council itself must give its opinion”.
As for citizen consultations prior to any boundary change, Article 10 establishes: “The municipal council should seek the views of the inhabitants on proposals for any boundary change. Such consultation may take the form of a referendum, opinion poll, questionnaire, meeting or be conducted in another manner”.
Thus, the municipal council or county council may itself decide to hold consultation and in which form. At first sight, the Act only explicitly refers to municipal councils, raising doubts about the consultation of the population by the county councils. During the consultation procedure, the Ministry of Local Government and Regional development however clarified that even though county councils are not mentioned explicitly in the Act, it is stated in the preparatory work that the county councils also may decide to hold consultations and in which form.
Finally, the referendum emerges as one tool among many others, on equal terms with opinion polls. The Local Government Act stipulates in Article 12-2 that the municipal council or the county council itself may decide to hold advisory referendums on proposals that concern the business of the municipality or the county authority, respectively. There are no legal procedures on the conduct of local referendums. In a comparative perspective, Norway was identified among the ‘weak’ states in regard to procedures of direct democracy.[60]
As examined above, the amalgamation process of municipalities and counties was an important aspect of the territorial reform undertaken by the government in Norway since 2013 elections. The process was mainly based on voluntariness and incentives. However, it happens that there has been a somewhat demanding situation with the compulsory amalgamation of some municipalities and counties.[61] Five counties were subjected to enforced mergers: Østfold, Akershus, and Buskerud into the new county ‘Viken’, and Troms and Finnmark into the new county ‘Troms and Finnmark’. Although there was local opposition in Østfold, Akershus, and Buskerud to their absorption into Viken, the opposition was much stronger in Troms, and even more so in Finnmark. The county administration in Finnmark refused to participate in formal negotiation talks about the merger and passed multiple resolutions in the county parliament opposing the merger. The Finnmark administration also organised a ‘referendum’ on the merger in May 2018.[62]
The Ministry of Local Government and Modernization very clearly recommended that municipalities choose citizen surveys to fulfil this requirement.[63] Moreover, while the Ministry paid a commercial polling organization to develop a template questionnaire for local opinion polls, no template or guidance materials on referendums were offered. The Ministry contended that opinion polls yield a more detailed picture of public opinion and thereby a more nuanced basis for decision-making, as compared to local referendums. Even so, many municipalities chose referendums as an instrument for consultation, instead of, or in addition to, a citizen survey: 61 percent of the municipalities that held a referendum had carried out a citizen survey first. Scholars pointed out that, when examining 156 positive decisions to merge, 81 decisions (52 %) were carried out without holding a referendum.[64]
Local governments were allowed to formulate questions and design ballots at their own discretion. Consequently, the questions put to vote and the available answers were worded very differently across the 221 referendums.
Following the local referendums on municipal mergers in 2016, a larger survey of local referendums was carried out. Here it was found that the vast majority of referendums were carried out in a good manner, but there were challenges associated notably with matters related to the design of questions and alternatives on the ballot paper.[65] During the consultation procedure, the Ministry of Local Government and Regional development also pointed out that after the wave of local referendums in 2016, it had published guidance on local advisory referendums with recommendations on the municipalities’ conduct of referendums and suggested using the Election Act as a basis for the conduct of local referendums as far as possible.
During the monitoring visit, the delegation was informed by the Ministry of Local Government and Regional Development that recently the government has been working on a proposal, aimed at amending the Boundaries Act, to give the Ministry special permission to carry out citizen consultations, including referendums, in cases where the Ministry has taken the initiative to boundary change.[66] Once the proposal approved by Parliament, the government will start the process to hold a referendum regarding the division of Kristiansand municipality (amalgamated by the previous government with Søgne and Songdalen).
The rapporteurs appreciate the initiative of the government; however, they encourage Norwegian authorities to reconsider the full issue of the consultation of local communities in the changes of local authorities’ boundaries.
Therefore, they consider that the requirements of Article 5 are not fully satisfied in Norway.
Without prejudice to more general statutory provisions, local authorities shall be able to determine their own internal administrative structures in order to adapt them to local needs and ensure effective management.
Article 6, paragraph 1 of the Charter provides that local authorities shall be able to determine their own internal administrative structure: the power to organise their own affairs is accordingly a part of the autonomy enjoyed by local entities.
In Norway, the municipalities are free to define their administrative structures, the status of their staff and the arrangements for their training and remuneration. The municipality or county may, furthermore, decide elements of the electoral system (e.g. whether to have elections over one or two days or the number of council seats within certain limits). Municipalities and county authorities may hire own staff, decide organisational structure, fix salaries, may establish legal entities/enterprises. Organisational autonomy was substantially augmented with the revision of local government legislation of 1992 and following years.[67]
Therefore, rapporteurs consider that the requirements of Article 6, paragraph 1 are satisfied in Norway.
The conditions of service of local government employees shall be such as to permit the recruitment of high-quality staff on the basis of merit and competence; to this end adequate training opportunities, remuneration and career prospects shall be provided.
Article 6, paragraph 2, of the Charter refers to the conditions of service of local government employees: they shall be such as to permit the recruitment of high-quality staff on the basis of merit and competence. The power to hire their own staff and set employee remuneration is a relevant factor highlighting the organisational and institutional autonomy of local governments.[68]
Basically, the municipalities and counties have a large degree of control over employees, but this is reduced through competence requirements and staffing standards, e.g., by not being able to move resources between businesses and sectors. During the meetings, KS noted that State rules of rights and obligations, including staffing standards and competence requirements, reduce self-government. Staffing norms at unit level (and not at municipality level) limit the municipalities' flexibility and scope for targeting resources between e.g., various schools within the municipality.
KS also pointed out that access to qualified personnel is increasingly a limiting factor. Lack of personnel and/or expertise is one of the major challenges facing the Norwegian municipal sector. This is already, and will become, an ever-increasing challenge in both the short and long term.
During the meetings with local authorities, the delegation was often told that the lack of human resources due to the full employment, especially for the care of elderly people and the health professions, is becoming a real challenge for municipalities and counties, risking undermining the level of social services to citizens.
In conclusion, the rapporteurs consider that Article 6, paragraph 2 of the Charter is respected in Norway.
The conditions of office of local elected representatives shall provide for free exercise of their functions.
Article 7, paragraph 1, seeks to ensure that citizens are free to serve as elected representatives and are not prevented from holding political office owing to financial or material considerations. Nobody should be deterred from standing for election at local level; once elected, local councillors should not be prevented from discharging their duties effectively.[69]
In Norway, local representatives are elected for four years and cannot be recalled. The councils are expected to serve the entire period of four years. Should a need for replacement of a member occur, this would take place within the same electoral list by appointment "of the first alternate member from the same list in the numerical order they were elected as alternates.
Norwegian legislation provides for the free exercise of the functions of local elected representatives.
During the monitoring visit, the delegation was informed of the growing tendency for hate speech and attacks on local elected representatives. In the written answers to the rapporteurs, KS pointed out that asurvey from 2021 (C-REX) shows that just over half of all local politicians have been exposed to at least one unpleasant inquiry during their time as elected politician; that is, threats, hate speech or harassing inquiries. Younger politicians experience this to a greater extent than older ones.
Among those who have been exposed to unpleasant inquiries, approximately one in four say that they have considered leaving politics, while 6% have decided to do so. The incidents have major consequences for many of those affected, be it in the form of self-restriction or self-censorship, or that they have failed to engage or speak out in a specific case or field. For many, one in four, it has also led to reduced social activities, the same proportion tells of reduced use of social media, and for some also reduced personal security.
A survey from 2020shows that there are very few cases in the legal system that deal with hate speech or threats against local elected officials. They also have no special legal protection by virtue of being local elected officials.[70]
The Ministry has made guidance for politicians and candidates on how to prepare for and how to handle such experiences.[71]
The rapporteurs consider that Article 7, paragraph 1 of the Charter is respected in Norway.
They shall allow for appropriate financial compensation for expenses incurred in the exercise of the office in question as well as, where appropriate, compensation for loss of earnings or remuneration for work done and corresponding social welfare protection.
Article 7, paragraph 2, refers to an appropriate financial compensation for elected representatives. The aim of the paragraph, in connection to paragraph 1, is to ensure that local elected representatives receive “appropriate financial compensation” and to avoid the conditions of office preventing, limiting, or even excluding potential local candidates from standing for office because of financial considerations.
In Norway, all municipal councils and county councils must adopt regulations for remuneration. Anyone who holds a municipal or county position of trust is entitled to transport, board and accommodation allowance for travel in connection with the position. The municipal board or the county council itself issues regulations on such compensation.
The Local Government Act states that elected representative shall receive renumerations for their work. Several of these provisions are aimed at elected officials who have the position of trust as their main occupation, e.g., Mayor. The municipal council and county authority council itself passes regulations that determine the amount for the different representatives. The representatives shall also have their expenses for travelling, board and lodging reimbursed and receive compensation for any lost income covered. In addition, the municipalities and county authorities shall ensure that elected representatives receive social benefits.
The rapporteurs consider that Article 7, paragraph 2 is respected in Norway.
Any functions and activities which are deemed incompatible with the holding of local elective office shall be determined by statute or fundamental legal principles.
Article 7, paragraph 3, deals with compatibility between the holding of a representative position at local level and other activities, either public or private, establishing that the “functions” and “activities” that cannot be made compatible with holding a local position once the candidate has been elected shall be determined by statute or fundamental legal principles.
In Norway, the incompatibilities are determined by several legal provisions, in Article 7 of Local Government Act. No issues have been raised during the monitoring visit.
Therefore, the rapporteurs consider that Article 7, paragraph 3 is complied with in Norway.
Any administrative supervision of local authorities may only be exercised according to such procedures and in such cases as are provided for by the constitution or by statute.
Article 8 of the Charter deals with supervision of local authorities. According to Article 8, paragraph 1, any administrative supervision of the activities of local authorities must be exercised according to such procedures and in such cases as are provided for by the constitution or by statute. The Charter establishes an important principle here in the area of inter-governmental supervision of local authorities: any form of such supervision must be provided for by the constitution or by statute, i.e., the Charter introduces the legality principle into the supervision of a local authority.[72]
In line with the requirements of the Charter, in Norway the rules governing the supervision over local authorities and the powers of the central authorities concerned are determined by the legislation, in Part VIII of the Local Government Act.
Therefore, the rapporteurs consider that Article 8, paragraph 1 of the Charter is respected in Norway.
Any administrative supervision of the activities of the local authorities shall normally aim only at ensuring compliance with the law and with constitutional principles. Administrative supervision may however be exercised with regard to expediency by higher-level authorities in respect of tasks the execution of which is delegated to local authorities.
According to Article 8, paragraph 2, of the Charter, the supervision over local authorities shall normally aim only at ensuring compliance with the law and constitutional principles. Expediency control can however be exercised in case of delegated tasks.
In Norway, formally, since 2001 supervision aims at controlling only the legality of municipal decisions and service provision. During the consultation procedure, the Ministry of Local Government and Regional development pointed out that municipalities and county authorities’ tasks are rarely delegated. Mostly, they are prescribed in special law and the state has no general authority to review and overturn individual decisions made by them. The Ministry also added that it had recently proposed amendments in several special laws to eliminate most of the remaining instances where the municipality and county authorities’ tasks and responsibilities are based on delegation.
In addition, as seen above, the new Local Government Act, in 2018, strengthened municipalities and county councils' rights in State supervision, including the right to appeal against decisions and an order to turn over information.
It should be noted that, in accordance with Chapter VI of the Public Administration Act, Norwegian State bodies can act as appellate instances for individual decisions made by municipalities or county authorities. Second paragraph of Article 34, of this Act was also amended. When a State body is the appellate instance for a decision made by a municipality or county authority, the appellate instance shall now attach great weight to the interests of local self-government when trying discretionary issues. Previously they only attached “weight”. It was also introduced an obligation for the appellate instance to describe how they have evaluated the interests of local self-government in their decision. KS considers this amendment positive, although overall it is not in favour of the existence of a provision in Norwegian law which entitles the state to review the municipalities’ free discretion.
The obligation to justify the authority of objection was also strengthened in the Planning and Building Act, so that objections must be justified in adopted policy and whether national or significant regional interest is actually affected.
Notwithstanding those important legal changes, in practice supervision in Norway remains extremely detailed and extensive; researchers have argued that the concept of legality had been stretched through expressions in legal texts such as “municipal duty to provide adequate/appropriate/proper…etc. services”, which leave the judgement of local services to the evolving norms of professionals.[73]
KS pointed out, in the meeting with the delegation and in its written answers, that there is a fairly widespread attitude and partly a culture, both at political and administrative level, that municipalities are only an implementation body for tasks desired by the State, and that there is thus no actual acceptance of a view thatmunicipalities are own independent legal subjects with their own elected leadership and a separate mandate also from the residents of the municipality. This vision is at the origin of several cases where the county governor overrules the municipality's discretion. KS regrets that it is still the case under Norwegian law that the State can set aside municipal decisions based on an assessment of appropriateness.
During the consultation procedure, the Ministry argued that in those cases the governor acted in individual cases as an appellate body while the right to appeal over individual decisions represents a legal safeguard for individuals, as another fundamental value. In this respect, the rapporteurs are of the opinion that the possibility for the state to overturn individual municipal decisions, where municipalities have made a choice between two legal alternatives, appears problematic in terms of risks it may pose to local autonomy.
Although usually a fair and collaborative relationship between the county governor and local authorities does exist, asit was pointed out during the meeting with the governor of the county of Nordland, the very notion of “national interest” remains vague. Sometime this “grey zone” originates tensions, as in the case of local development projects impacting on reindeer husbandry, which is considered as national interest in Norway.
Therefore, the rapporteurs consider that Article 8, paragraph 2, of the Charter is partially respected in Norway.
Administrative supervision of local authorities shall be exercised in such a way as to ensure that the intervention of the controlling authority is kept in proportion to the importance of the interests which it is intended to protect.
Article 8, paragraph 3, deals with the way in which the supervision is exercised in practice, and requires compliance with the principle of proportionality. Under the principle of proportionality, the regional or State body should intervene only to the extent necessary, taking into account the relevance of the public interest at stake, or the seriousness of the legal violation allegedly committed by the local authority.[74]
In Norway, as see above, the State can supervise that municipalities and county councils comply with imposed duties.
KS pointed out that there is basically an uneven balance of power, in some significant cases, when the county governor supervises individual municipalities. The county governor invests a considerable number of resources in these inspections, while the municipalities do not have similar resources with which to meet the supervisory authority. In addition, there is little culture in the municipality to ask critical questions to the supervisory authorities, who are thus left with the power of definition.
Despite the new provisions in the Local Government Act, on the promotion and protection of local self-government, KS considered that a lack of understanding of self-government and the rules on relationships between national and local authorities continues to have an impact on State management of municipalities and county councils. It still seems that when national interest is at stake, it automatically prevails over self-government, whereas according to the statutory principles, national interest should be weighed against self-government interest, specifically in the individual law and in the individual case.
Therefore, the rapporteurs consider that Article 8, paragraph 3, of the Charter is partially respected in Norway.
Local authorities' financial resources shall be commensurate with the responsibilities provided for by the constitution and the law.
Another basic principle, established in Article 9, paragraph 2, requires that local authorities should have sufficient financial resources in proportion to the responsibilities assigned to them by law. This paragraph enshrines the so-called “principle of commensurability” of local authorities’ financial resources. This means that the resources available to local authorities should be sufficient and commensurate with their functions and tasks. To this purpose, any transfer of powers and tasks should be based on careful calculation of the actual service delivery costs to be met by local authorities. The costs of mandatory and delegated tasks might include several factors (such as the socioeconomic structure of residents) in order to produce more precise calculations and avoid arbitrary political decisions.[77]
At present all interlocutors agreed that the resources are sufficient, although questions arise on
the sustainability of the current system of welfare, in the face of the aging of the population. During
the meetings it was pointed out that in the specialised social area there are certain challenges, but by now the Norwegian financing scheme is well functioning. giving the municipalities and county authorities the possibility to provide an equal range of services to their citizens.
The rapporteurs consider that Article 9, paragraph 2 is respected in Norway.
For the purpose of borrowing for capital investment, local authorities shall have access to the national capital market within the limits of the law.
Article 9, paragraph 8, refers to the access to the national capital market for the purpose of borrowing for capital investment. Access to national capital markets is important for local authorities to finance investment projects necessary for the further development of the local area because in many cases the amount of their own “ordinary” resources is not sufficient to cover all the projects and plans decided on by local authorities to satisfy local needs. However, like other rights enshrined in the Charter, this is not absolute and must be reconciled with the general policy on public sector spending and debt. This is why the Charter says that the access must take place “within the limits of the law”. Moreover, as a result of the recent economic crisis, many countries have introduced austerity measures to deal effectively with public deficits, so access to the national capital market should be analysed in the context of national fiscal policy and the governance of public debt.[81]
In Norway, local authorities can take out loans, and legislation establishes certain requirements for responsibility. Article 14-14 to 14-17 of the Local Government Act regulates the purposes for which municipalities are allowed to take out loans. Borrowing can only finance investments in buildings, facilities and assets with lasting value. When a municipality decides to take out a loan, the decision must state how the loan is to be paid.
Therefore, the rapporteurs consider that Article 9, paragraph 8 is complied with in Norway.
As far as possible, grants to local authorities shall not be earmarked for the financing of specific projects. The provision of grants shall not remove the basic freedom of local authorities to exercise policy discretion within their own jurisdiction.
Article 9, paragraph 7, of the Charter establishes that “As far as possible, grants to local authorities shall not be earmarked for the financing of specific projects. The provision of grants shall not remove the basic freedom of local authorities to exercise policy discretion within their own jurisdiction”.
Although most of the State grants are unconditional (non-earmarked), grants for specific projects do exist in Norway. However, local authorities are free to exercise policy discretion within the purpose of those grants. No issues have been raised on this topic during the monitoring visit.
For these reasons, the rapporteurs consider that Article 9,paragraph 7 is complied with in Norway.
Local authorities shall be consulted, in an appropriate manner, on the way in which redistributed resources are to be allocated to them.
Article 9, paragraph 6, of the Charter refers to a general principle of consultation, as enshrined at Article 4.6. In this case, consultation is required on the way in which redistributed resources are to be allocated to local authorities by other levels of government. Under Article 9.6, consultation is not merely a compulsory procedure that has to take place in a timely manner before a final decision is made. It must also cover the manner in which a decision is made and the criteria for doing so, not only the decision itself.[80]
Consultation is an integral part of local government in Norway, as said above.
There are regular consultations between the government and the municipal sector about the local authorities’ finances in the State budget. KS meets the government on behalf of the municipal sector. The main purpose of the consultation scheme is to reach agreement on the local authorities’ income. Another objective of the scheme is to reduce the use of strong State management tools by establishing agreement on priorities related to the local authorities’ resources. The consultation framework has contributed to better relationships between KS and the State, and to a common understanding of the needs of the local sector.
The rapporteurs consider that Article 9, paragraph 6 is respected in Norway.
The protection of financially weaker local authorities calls for the institution of financial equalisation procedures or equivalent measures which are designed to correct the effects of the unequal distribution of potential sources of finance and of the financial burden they must support. Such procedures or measures shall not diminish the discretion local authorities may exercise within their own sphere of responsibility.
Article 9, paragraph 5 addresses the question of the financial situation of municipalities that are financially disadvantaged due to their being located in economically or geographically weak areas (transition, mountain or island regions), or simply because they are too small to obtain the amount of resources needed to perform their tasks.
Equal service offers to all residents, regardless of which municipality one lives in, is a fundamental prerequisite in Norwegian society. In the revenue system for the municipalities, this principle is safeguarded through two redistribution schemes which are fully financed by the municipalities themselves.
Through tax equalisation, municipalities with high tax revenues from tax own income and wealth must transfer part of their revenues to municipalities with low tax revenues.
In the equalisation of expenditure, each municipality calculates their need based on the composition of inhabitants the municipality has, both in relation to age composition and certain socio-economic characteristics. In addition, the municipality's geography is also emphasised. The municipalities that have needs per inhabitant above the national average receive an addition to their framework grant. This is financed in its entirety through corresponding reduction in the framework grant from municipalities with lower needs than the national average.
As pointed out by the written answers of KS to the rapporteurs, the equalisation mechanism is transparent but can be experienced as complicated. It works efficiently, thus there is little need for discretionary funds to compensate for conditions that are not captured through the fixed part of the income system.
KS also noted that at regular intervals, an expert committee is set up with representatives from municipalities/county councils, the State and academia, for a comprehensive review of the income system. In addition, it should be emphasized that the part of the system that ensures equal services, the equalisation of expenses, is a mechanism that is recognised as a subject and economics assessment, and to a very small extent is made the subject of political assessments and priorities. Further, this has been important for and a contributing factor to the income system having a high level of legitimacy.
The rapporteurs consider that Article 9, paragraph 5, is respected in Norway.
Part at least of the financial resources of local authorities shall derive from local taxes and charges of which, within the limits of statute, they have the power to determine the rate.
Article 9, paragraph 3, requires that at least part of the financial resources of local authorities must derive from local taxes of which, within the limits of statute, they have the power to determine the rate. The Charter does not state that a local authority’s own resources must contain a uniform proportion of local taxes, but it does make it mandatory for “at least” part to derive from local taxes and charges. This part should be large enough to ensure the greatest possible financial independence of local authorities.
In Norway, taxation accounts for 36.2% of subnational government revenueaccording to the OECD data.[78] Income tax is the main source of tax revenue In 2020, the national rate was 22 per cent, with percentage point shares of 11.10 for municipalities and 2.45 for counties. A wealth tax of 0.7 per cent (for amounts over NOK 1.5 million) also accrues to municipalities. These maximum rates are set annually by Parliament. Local authorities can in principle choose a lower rate, but this hardly ever happens because the government then reduces grants by the corresponding amount. The reason is that financial equalisation (see below) depends on actual tax revenues. Municipalities may also levy local taxes on property and natural resources.[79]
During the meeting with the delegation and in its written answers, KS pointed out that municipalities and county councils have limited opportunities to influence their own income through taxation. Municipalities can influence to a small extent and the county municipalities almost not at all. The municipalities' opportunity to influence their own income is through the property tax, but the framework for this has been narrowed in later years. The property tax is the only form of financing in which the individual municipality has complete control, and which does not have consequences for other parts of the transfers to the municipalities. Restrictions have been introduced on two occasions on the municipalities' ability to collect property tax on housing and leisure property. From 2020, the maximum tax level was lowered from 7 to 5 %. In 2021, the maximum tax level was reduced from 5 to 4%. Restrictions on the right to collect property tax on other objects have also been adopted. It can thus be pointed out that the municipalities' room for action in their role as local taxation authority is somewhat reduced.
The rapporteurs consider that Article 9, paragraph 3, is respected in Norway.
Local authorities shall be entitled, within national economic policy, to adequate financial resources of their own, of which they may dispose freely within the framework of their powers.
Article 9, paragraph 1, of the Charter establishes two basic principles in the area of finance. First, local authorities should have their own financial resources; the right to “adequate” resources is not absolute but has to be exercised “within national economic policy”. Second, they should be free to decide how to spend those resources.[75] This freedom takes the form of various spending decisions, the most important being the adoption of an annual budget. Any limits and restrictions imposed by higher authorities on local authorities should be specified and justified and aim at ensuring macroeconomic stability and sound.
This paragraph is respected in Norway. The financial resources are adequate, a relevant part comes from local taxes and the municipalities may decide their allocation. Public finances are strong, both at the central government and in the municipal sector.
According to the information provided by the Ministry of Finance to the rapporteurs, net operating results for the local sector (municipalities and county authorities) has been strong for many years, and above the recommendation set by the Statistical Reports Committee for county and municipal government finance (TBU).[76] For several years, the local sector has had stronger growth in free revenues (non-earmarked revenues) than predicted in the presented budgets. This is mainly due to higher than projected tax income, and lower growth in pension and demographic costs than expected. This has led to high net operating results in the local sector over a long period of time. As a result, the municipal local has been able to increase their savings in free operating equity (non-earmarked operating equity). The municipalities and county authorities can freely use the funds to finance operating or investment expenses. It is not a goal that the funds should increase over time.
In the meetings and in the written answers to the rapporteurs, KS considered that, although it is always possible to do better, looking at the big picture, the income level is at a reasonably acceptable level. The municipal sector has been annually compensated over the last 10–20-year period for increased costs as a result of changes in population, wage and price growth and growth in pension costs beyond wage growth.
Therefore, the rapporteurs consider that Article 9, paragraph 1 is respected in Norway.
The financial systems on which resources available to local authorities are based shall be of a sufficiently diversified and buoyant nature to enable them to keep pace as far as practically possible with the real evolution of the cost of carrying out their tasks.
Article 9, paragraph 4, refers to the need for the resources available to local authorities to be of a sufficiently diversified and buoyant nature to enable them to keep up as far as practically possible with the actual changes (increases) in the costs for carrying out their tasks.
In Norway, the revenues of municipalities may come from different sources (own taxes and fees, transfers, other sources). Municipalities may adapt their own income to the different circumstances: for instance, if the local tax intake goes down for general economic reasons, the local authority may decide to increase local fees and charges paid by local service users (especially in urban areas) as a way to offset the decline.
The rapporteurs consider that Article 9, paragraph 4 is respected in Norway.
Local authorities shall be entitled, in exercising their powers, to co-operate and, within the framework of the law, to form consortia with other local authorities in order to carry out tasks of common interest.
Article 10 of the Charter covers the possibility of co-operation between local authorities and their right to associate, at both national and international level.
Article 10, paragraph 1, refers to types of cooperation aimed at carrying out tasks of common interest. Under Article 10.1, local authorities firstly have a general right to co-operate with one another in order to deliver local services or discharge their responsibilities. Inter-municipal cooperation (or cooperation at other levels of local government) is a fundamental tool for local authorities in terms of delivering services, in view of the fact that many of them are too small or too weak (financially speaking) to deliver all the services they are supposed to or to carry out any meaningful local strategy or policy. This general entitlement to cooperate with other local entities is supplemented by a more specific right, namely the right to “form consortia”, i.e. to create separate organisations. Although the Charter only mentions “consortia”, the specific right to create joint institutional structures, separate from the participating local authorities, may take various forms.
In Norway, Article 17 of the Local Government Act of 2018 allows for and specifies intermunicipal cooperation. Article 18 to 20 regulations three of these types of cooperation. Two or more municipalities or county authorities may together establish an intermunicipal political council.[82] The council may deal with matters that cross municipal or county boundaries. The municipal councils and county councils themselves resolve to establish such a council. An intermunicipal political council cannot be authorised to make individual decisions. However, the council may be authorised to make such decisions on internal affairs within the cooperation and to manage grant schemes.
Two or more municipalities or county authorities together may further establish a municipal task community to solve common tasks. The municipal councils and county councils themselves resolve to establish a task community.
The Local Government Act also allows for a host municipality cooperation. This means that a municipality can entrust the performance of statutory tasks to another municipality (called the host municipality). The host municipality has the responsibility for producing the service according to the agreement made with the two municipalities. Another form of inter-municipal cooperation are the limited companies regulated by the Intermunicipal Companies Act, this is a common form of cooperation especially in case of municipal business activities.
Such inter-municipal and inter-regional cooperation is very common in Norway. Every municipality is involved in at least one cooperative arrangement and most municipalities are members of several cooperative arrangements. Cooperative arrangements have been particularly common in utility services such as power supply, water and sewerage and public transport. Other areas of cooperation include auditing, emergency clinics, emergency services, educational-psychological services, and child welfare.[83]
The municipalities have wide access to collaborate on both statutory and non-statutory tasks. There is extensive inter-municipal cooperation in Norway. All municipalities in Norway are involved in one or more collaborations. In the following service areas, there is the greatest degree of collaboration: audit, crisis centre, fire service, emergencies, child protection services and IT tasks. In these areas, the degree of cooperation varies from around 50% of the municipalities to 73% of the municipalities.[84]
Therefore, the rapporteurs consider that Article 10, paragraph 1 of the Charter is fully respected in Norway.
The entitlement of local authorities to belong to an association for the protection and promotion of their common interests and to belong to an international association of local authorities shall be recognised in each State.
In this paragraph the Charter clearly recognises and sets out another right of local authorities: that to belong to (a) a national association for the protection and promotion of their common interests; and (b) an international association of local authorities.
The “associations” referred to in paragraph 2 are different from those mentioned in paragraph 1. Those mentioned in Article 10.1 are set up for the delivery of local services, plans or projects and are instruments for discharging duties and responsibilities. Conversely, those referred to in Article 10.2 are instruments for the promotion of common interests. These associations play a fundamental role in representing and defending the rights, powers and interests of local authorities and they carry out many activities on behalf of them all (not only in favour of their members).[85]
In Norway, the Norwegian Association of Local and Regional Authorities (KS) was formed in 1972 through a merger of the Union of Norwegian Cities and the Norwegian Association of Rural Municipalities.[86] KS represents all municipalities and counties as well as some 500 public enterprises as both an interest and employer organisation. KS employs around 260 people at its headquarters in Oslo, regional offices throughout Norway and a representative office in Brussels. All municipalities and county councils are members.
In the latest budget, 75 per cent of revenues are from membership fees and 25 per cent from other sources, including sales of digital solutions and legal assistance to members. KS also owns several companies that provide services to members and others, including consultancy, publishing, a weekly newspaper, training and property leasing.[87]
KS is Norway’s largest public employer organisation. All municipalities and county councils (with the exception of Oslo) have authorised KS to negotiate and enter agreements with employee organisations on salaries and other conditions. In total, KS covers about 440,000 employees.
The rapporteurs consider that Article 10, paragraph 2 of the Charter is fully respected in Norway.
Local authorities shall be entitled, under such conditions as may be provided for by the law, to co-operate with their counterparts in other States.
Article10, paragraph 3, addresses the cooperation of local authorities with their counterparts in other States. The right to engage in cross-border cooperation is also protected.
Norway has a long tradition of cross-border cooperation. It has ratified the European Outline Convention on Transfrontier Co-operation between Territorial Communities or Authorities (ETS No. 106)
on 12 August 1980. The Outline Convention entered into force on 22 December 1981. On 18 October 2010, Norway ratified the Additional Protocol to the European Outline Convention on Transfrontier Co-operation between Territorial Communities or Authorities (ETS No. 159), which entered into force on 19 January 2011.
The EU programme Interreg strengthens cooperation across national borders. Projects that promote regional development, exchange of knowledge and sustainable economic growth receive financial support from Norway through several Interreg programs.
Several Norwegian counties are also members of international organisations. The largest and most important arethe Conference of Peripheral Maritime Regions (CPMR) and the Baltic Sea States Sub-Regional Cooperation (BSSSC).
The rapporteurs consider that Article 10, paragraph 3 of the Charter is fully respected in Norway.
Local authorities shall have the right of recourse to a judicial remedy in order to secure free exercise of their powers and respect for such principles of local self-government as are enshrined in the constitution or domestic legislation.
Article 11 of the Charter refers to an effective judicial remedy to ensure respect for local self?government. It stresses the requirement that local authorities should have the right to invoke and to defend in the courts the principles of local self-government, especially in the context of lawsuits in which their rights and powers are challenged or curtailed, or when those rights are endangered by the higher (central or regional) levels of government. “Recourse to a judicial remedy” means access by a local authority to either a properly constituted court of law or an equivalent, independent, statutory body.[88]
In Norway, as see above, in 2018 Article 1-4a in the Act relating to mediation and procedure in civil disputes (The Dispute Act) entered into force. This Article explicitly states that municipalities and county authorities in certain instances can bring an action against the State concerning the validity of decision by a State body. These decisions are for example when a State body annuls or amends a municipal decision upon or without an appeal, imposes obligations on the municipality following an audit or divides rights or obligations between municipal or county authorities.
If the municipality or county authority disagree with the State bodies decision, they can now bring that decision to the courts. If the courts find that the State’s decision is not valid, the municipalities can also submit a claim for compensation. There are some barriers in place to protect private persons and their rights to important services in cases where there is a court case between the municipality and State about the decision in their case. There are exceptions to the right to sue in child welfare cases where the State is the appeals body.
Since this provision entered into force, there have been some cases in courts between municipalities and the State. They have however regarded cases and issues that fall outside the scope of Article 1-4 a.
The delegation was informed that the Supreme Court, on 6 June 2023,[89] decided the case raised by the municipality of Beiarn, regarding, among other aspects, the municipality’s legal standing. The Supreme Court considered that the rule in Article 1-4 a does not exhaustively state the municipality's jurisdiction to sue, but that municipalities may also have jurisdiction to sue the State in other cases where the general conditions for legal interest is fulfilled.[90]
However, KS noted that, notwithstanding this new judicial remedy, the municipalities are not well protected against Parliament, e.g. when, as it happens often, Parliament adopts detailed legislation.
As pointed out by the Supreme Court in its written answers, in cases brought before the courts, the courts – with the Supreme Court in the final instance – have the power and a duty under Article 89 of the Constitution to review whether statutory provisions and administrative decisions are in accordance with the Constitution. However, Norway does not have a system of abstract constitutional review, and there is a general requirement of "relevance" before a case may be heard in court. Thus, the constitutionality of a law or a measure is only considered if the issue arises in connection with a specific case.
Therefore, the rapporteurs consider that Article 11 is respected in Norway.
No constitutional or legislative reform aimed at recognising local self-government has succeeded to date.
