ALPHA. Demokratiskolan.se is a PROTOTYPE · Content review in progress
Demokratiskolan
The Local Economies card from MethodKit for Society and Politics
Card 63 of 128 · MethodKit for Society & Politics
  • AreaEconomy & work
  • Centre of gravityThe municipality
  • Points of influence3 on the journey
  • Decisive electionThe municipal election
Economy & work

Local Economies

Services, production & vending locally

The grocery shop, the hairdresser and the carpenter in town are more than service: they are jobs, a tax base and life between the houses. No level shapes the local economy like the municipality (kommun), with plans, land and procurements as its tools. That is why the municipal election is often the election that affects your town's economy most.

Where does the power lie?1

  • Municipality · plans, land & procurement · approx 50 %
  • Region · development funds & support · approx 15 %
  • State · tax equalisation & service support · approx 25 %
  • EU · state aid & funds · approx 10 %

The centre of gravity is in the municipal hall. The municipal election decides how plans, land and procurements are used for the town's economy.

How it works: the breakdown

The municipalityThe town's engine · centre of gravity
The regionThe county's development
Central governmentThe equalisation & the frame
Who decides?
The municipal council (kommunfullmäktige), the elected representatives of your municipality, the urban development committee and the business office.
The regional council (regionfullmäktige) and the regional development committee.
The Riksdag, the Government, Tillväxtverket (the Swedish Agency for Economic and Regional Growth) and the County Administrative Boards (länsstyrelser).
What do they decide?
Detailed development plans (detaljplan), land and premises, procurements for large sums, and the service that keeps companies in town.
Regional development strategy, business support, support for commercial services and the visitor economy.
Tax equalisation between municipalities, rural policy, support for commercial services and the procurement laws.
Where are decisions made?
In the council and committees. Procurements are advertised openly.
In the regional council and together with the municipalities.
In the Riksdag and at the agencies.
Who pays?
The municipal tax. Local companies pay it back through jobs and the tax base.
The regional tax plus national and European development funds.
The central government budget equalises: municipalities with different conditions should be able to give comparable service.
Fastest way in?
Municipal election Citizen's proposals (medborgarförslag), consultations on plans, dialogue with the business office.
Regional election Respond when the development strategy goes out for consultation (remiss), apply for the region's support.
General election Respond to referrals (remiss) on rural and regional policy.
EUThe EU's state aid rules set limits on what municipalities may give companies, and regional funds co-finance development. Influence it in the European Parliament election.

Read the table by column to understand one level, or by row to compare the levels. The green level is the area's centre of gravity.

How it works: follow the decision

The case The town's last grocery shop is saved
  1. EU

    The state aid rules set the limit

    Municipalities may not favour individual companies however they like: the EU's state aid rules apply even to the smallest town. But support for basic services in sparsely populated areas is possible within the limits.

  2. State

    The central government sets aside support for commercial services

    The Riksdag (Sweden's parliament) has decided on special support to keep grocery shops in sparsely populated and rural areas. Tillväxtverket and the regions handle the money.

    Point of influence

    The general election decides whether the support remains and how large it is.

  3. Region

    The region points out the service points

    In the regional service programme it is mapped where service risks disappearing. The shop in town is identified as an important service point and can be granted support.

    Point of influence

    The programme is drawn up in dialogue with municipalities and the voluntary sector. Village associations and local residents can make their voice heard.

  4. Municipality

    The municipality gathers services in the shop

    Parcel pick-up, a pharmacy agent and home delivery of goods to the elderly are gathered in the shop. Many municipalities pay a home delivery grant, and the municipality's own presence gives the shop steadier income.

    Point of influence

    Citizen's proposals (medborgarförslag) and conversations with the municipality's business office are the way in.

  5. Your everyday life

    The lights stay on

    The shop lives on as the town's hub: jobs, a meeting place and everyday service. Behind the checkout lie decisions on four levels.

The journey looks the same in reverse: what has been built came the same way, through the same decisions. Whoever knows where the decisions are made also knows where they can be changed.

Questions to discuss

  1. Which shops and services could your town not manage without?

  2. Should the municipality buy locally even if it costs more, and if so, who should pay the difference?

  3. What does it do to a town when the last grocery shop or bank disappears?

  4. How far does the central government's responsibility reach for service to exist across the whole country?

  5. What is your next step if you want to strengthen the town's economy: your wallet, an association or the council?

Glossary

Offentlig upphandling
When municipalities, regions and the central government buy goods and services under legally governed rules.
Hemsändningsbidrag
A municipal grant that helps shops deliver goods to residents in rural areas.
Regionalt serviceprogram
The region's plan to keep basic services across the whole county.
Skatteutjämning
The system that redistributes money between municipalities with different conditions.
Statsstöd
Public support to companies, tightly regulated by the EU so as not to distort competition.

Go further

Footnotes

1) This is an estimate of how decision-making power over the issue is split between the municipality, the region, central government and the EU, based on how responsibility is divided in legislation. A teaching guide, not an exact measurement.