Background information

The effects of the increasing fuel prices are causing hardship especially in areas with vast distances and low access to public transport. The government of Sweden has put forward a law proposal to the Council on Legislation [Lagrådet]. The law is proposed to enter into force on 1 August 2022 and to expire at the end of December 2022, but has not been passed yet. With the aim of mitigating the effects of increasing fuel prices due to the war in Ukraine, the government of Sweden has proposed that owners of private cars receive a compensation.

Content of measure

The Swedish government proposes support for those affected by high fuel prices by granting them a compensation of SEK 1,000 (€96). Where the authorities have access to bank account details, the payment will take place automatically through a bank deposit. If not, the eligible person will receive a withdrawal slip.

The prices are particularly noticeable for people living in rural and sparsely populated areas. Thus, there is high dependency on private vehicles to commute to work and education. In these areas, each eligible person is to receive 50% more in compensation than in the rest of the country, accounting to SEK1,500 (€145).

To be eligible for the compensation, the car must have been registered to the person on 28 February of 2022. The higher compensation also requires that the person was registered in one of the specified municipalities on 28 February 2022.

The fuel compensation proposal for individuals was first announced on 14 March 2022 as part of a package of measures to address electricity and fuel price increases resulting from the invasion of Ukraine. The Legislative Council will now examine the proposal. The aim is for payments to be made in August-September of 2022.

Use of measure

The government estimates that a total of around 3.7 million car owners will receive compensation.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Does not apply to businesses	Applies to all citizens

Actors and funding

Actors	Funding
National government	National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

• Social partners jointly
• Main level of involvement: Peak or cross-sectoral level

Involvement

The umbrella organisations for social partners have left statements regarding the proposed measure.

Views and reactions

Both the Confederation of Swedish Enterprise (Svenskt Näringsliv) and The Swedish Confederation of Professional Employees TCO advice against the proposal. The employers’ organisation argue that the direct transfers is not impactful as it does not support enterprise and does not address the underlying problem. TCO argues that the tool is overly blunt and not sufficiently targeted to the households’ de facto use and need of the car.

Sources

• 19 April 2022: The Swedish Confederation of Professional Employees TCO's statement (TCOs yttrande) (www.regeringen.se)
• 22 April 2022: Confederation of Swedish Enterprise's statement (Remiss från Svenskt Näringsliv) (www.svensktnaringsliv.se)
• 05 May 2022: The government proceeds with the proposal to compensate car owners (Regeringen går vidare med förslaget om kompensation till bilägare) (www.regeringen.se)