Agenda

1. Norwegian Labour and Welfare Policy. Enhancing the Labour Market Prospects for the Occupationally Disabled and for Employees With Health ProblemsErik OftedalDirectorDirectorate of Labour and WelfareNorway

2. Agenda • Challenges in Norwegian Labour and Welfare policy • The Norwegian way of enhancing labour market prospects for vulnarable groups • What if we succeed

3. Brief information about Norway • Population 4 640 200 • 79 % active in work • Women: 76% • Men: 83 % • The majority is employed in: • Public sector • Private service sector • Unemployment rate: 2.8 %.

4. Fewer to share the costs 2003: 2,6 1967: 3,9 2050: 1,6 A steady decrease in the number of people in the work force per pensioner

5. Macroeconomic and labour market situation is very good • High material income and wealth • Steady growth (3- 3 ½ %) • High and stable labour force participation (80%) • Low unemployment (2-3 %) • Low inflation (1-2 %) • Low real interest rates (2-3 %) • Very strong public finances

6. The other sides of the medal • ”It affords a strong back to bear good days” • How to keep up with intergenerationally well balanced economy and welfare? • An ageing population • Expected increase of expenditure towards health and care services as well as pensions. • Very high and increasing absence due to sickess and incidence and prevalence of disability: • 700.000 persons – ¼ of the grown-up population below pension age receive an income support on the grounds of sickness, health problems or disability

7. Challenges in Norwegian welfare – Norway today In the work force: At the outskirts of the work force, receiving benefits: 2 400 000 298 000 disability pension 28 000 temporary disability pension 60 000 social welfare 120 000 sickness benefit 66 000 occupational rehabilitation 58 000 unemployment benefit 44 000 rehabilitation benefit 12 000 transitional benefit 7 400 individual benefit 2 800 severance benefit 2 400 severance pay

8. Net transfers according to age in 2004

9. Increasing number of income security beneficiaries Social welfare Daily cash benefit Sickness benefit Rehabilitation allowance Vocational rehabilitation allowance Disability benefits

10. In an OECD context Norway differs too % of employees absent on account of sickness Source: EULFS.

11. Few disability beneficiaries return to the labour market % of the disability beneficiaries that return to the labour market Note: Data refer to 2004 for Norway, Poland and Switzerland and 1999 for the other countries Source: National Labour Force Surveys.

12. The number of disability beneficiaries – the double of OECD-average % of work-age population …and we spend the double of OECD-average on sickness benefit and disability Source: National insurance authorities: NIA (Norway), IV (Switzerland) and ZUS (Poland).

13. The Norwegian path to increased welfare and a more inclusive labour market • The trend has to be changed • The strategy • Inclusive Workplaces – a tripartite agreement • The NAV reform – a new state agency for Work and Welfare • The White Paper on Work, Welfare and Inclusion • A reform of the pension system – presented by Mr. Christensen yesterday

14. Inclusive Workplaces – a tripartite agreement • Agreement 2001-2005 between the Government and the Social partners prolonged 2006-2009. The goals • Reduce sickness abscence by 20 % compared to 2001 • Increase the employment rate of disabled persons • Increase the average, real retirement age

15. Inclusive Workplaces cont. • A lot of good initiatives and work locally • Local work is based on cooperation agreements signed directly between the enterprises and NAV • New proposals 2007 …..

16. A new model for intensified follow-up on sick leave • Employer and employee are required to (according to the Working Environment Act) • agree upon a mutually binding follow-up plan at the latest 6 weeks after the onset of sick-leave • arrange a dialogue-meeting within 12 weeks of the onset of sick-leave • The doctor is required by law to participate in the meeting • if desired by the employee • NAV’s role is to (according to the National Insurance Act) • check the possibilities of and attempts at work related activity, by controlling the sickness certificate and the follow-up plan • arrange a new dialogue meeting with the employer and employee within 6 months, possibly with the doctor participating too • effectuate economic reimbursements and benefits • coordinate access to relevant public services • Company health service,union representatives, safety deputies should participate too

17. A wave of reorganising the Work and Welfare administrations • A dominating trend in many European countries • Most outspoken in Northern Europe • Great Britain, The Netherlands, Germany, Denmark, Finland • The Norwegian reform – more far reaching

18. A New Employment and Welfare Administration • Merger • The Public Employment Service • The National Insurance Service and • The Municipal Social Welfare Administration • The aims • Better coordination of benefits • More effective and work-oriented casework • More user-oriented services and participation • Gradual implementation • Central agencies in 2006 • Regional and local offices 2006-2009

19. NAV unifies the services National Insurance Service (state) Social welfare (municipality) Aetat Employment Service(state) • Social welfare office in • almost every municipality • Around 4 000 employees • Aetat Directorate of Labour • Aetat county • Aetat local • Special units • Around 3 500 employees • National Insurance Administration • County office • National insurance office • Special units • Around 9 000 employees

20. The goals of the NAV-reform • More people employed and active • One door for all the users of NAV – common access to combined and parallel services • Distinct work focus for frontline services • Steady course from passivity to activity • Time for more and better follow up and a higher degree of individual adjustments • Distinct division between ”production” and work related processes • Increased use of self service • Simple requests handled in a simple manner • Active user participation

21. New interaction between state and local authority • The NAV office is based on an equal partnership between state and local authorities. The office will offer one door to all of NAV’s services. • A general agreement between The Ministry of Labour and Social Inclusion and The Norwegian Association of Local and Regional Authorities constitutes the framework for local cooperation for all local authorities. • Employees within both central and local authorities will receive training and education, and will work with the same tasks. • The local NAV office will offer services on behalf of both central and local authorities, but in a way that makes them seem like one and the same.

22. Organizational reformNot only a new wrapping Motto: Everyone is unique and has unique service and support needs • Focus on functioning, abilities and possibilities – not diagnosis • Symmetry between support/services and individual obligations • Services tailored to INDIVIDUAL needs – not the target group, type of income support etc.

23. Decision making close to the public • All follow up should take place in the local NAV office – main focus on close collaboration with the individual as far as work and activity are concerned • The NAV office decides which tools and measures to apply • The NAV office uses their own judgement as far as possible within the framework of rules and regulations. The office’s opinion should be a leading factor when deciding upon the case by special units • activity-requirement, conditions that have to be met, etc. • The NAV offices use individual plans as a tool – based on a.o. the ability to work and the agreement on activity • The plan plays a guiding role when assessed by a special unit • The NAV office coordinates services to the public • The NAV offices must be credible and reliable as far as follow up and guidance are concerned

24. White Paper on Work, Welfare and Inclusion • Preventive and facilitative measures at the workplace • New and better coordinated work-oriented measures • Reformed temporary income security within the NIS • A new qualification programme outside the NIS • Supplementary measures • for disabled persons • for immigrants • to combat poverty

25. Tools – today’s practice Sickness benefit Medical measures Rehabilitation allowance Primarily medical measures All labour market measures Vocational rehabilitation allowance Temporary disability benefit No demand for active measures Unemployment benefit Status depending on labour market measures Social welfare Random offers of measures

26. Tools – future practice Follow up according to needs Assessment Follow up Non-temporary wage subsidies Long term adapted working environment Assisted work Labour market training Ordinary education Motivation measures Wage subsidies Medical rehabilitation Low threshold alternative Economic counselling Close individual follow up Qualification programme Evaluation of work ability Tools should be applied freely, without regard to type of benefit/focus groups

27. Work ability assessment • A new, integrated system for work ability assessment is under way • Today: A number of concepts, methods and tools are in use within NAV • It will be the point of departure for formulating individual action plans • A move from the focus on diagnosis/disability to a focus on work-related abilities and possibilities

28. Client Benefits Job Qualifications Social qualifications Job-seeking qulifications Capacity Work Claims of capacity Claims of job qualifications Claims of personal qualifications Recruitment strategy Employee Assesment of work ability-

29. Developing and renewing work-related measures and services • More flexible and individually-adapted use of all types of measures and services provided by the new employment and welfare administration • Extended use of wage subsidies through implementing trial projects involving wage subsidies that are not of a limited duration • Strengthening measures to improve fundamental knowledge and skills on the part of job-seekers who need this

30. Developing and renewing work-related measures and services cont. • Establishing and wider access to new and better clarification measures for users who do not currently have access to this • Based upon the situation and needs of the individual • Will benefit • the long-term unemployed • young people and • groups of immigrants • Establishing and wider access to new and better follow-up measures for users who do not currently have access to this • Based upon the situation and needs of the individual • Will benefit • the long-term unemployed • young people and • groups of immigrants

31. Qualification programme • A new qualification programme proposed established within NAV Local Services at the end of 2007 • Target group • persons with no or very limited benefits from the National Insurance Scheme • mainly persons living off municipal social welfare • Participation in the qualification programme will entitle to qualification benefits granted as standard amounts

32. Qualification programme cont • The objective of the programme is to help participants to get work – by making the effort more general, systematic and binding in regard to both the participants and the public services • The programme can consist of several kinds of measures based on individual needs, e.g: • Labour market measures • Different kinds of training • Motivation • The municipial part of the local office will be responsible for implementing these programmes – but the programme can consist of all measures and services in accordance with individual needs

33. Sickness benefit Sickness benefit Work Work Medical rehabilitation benefit A new temporary income security benefit Vocational rehabilitation benefit Time- limited disability benefit Disability benefit Disability benefit Temporary Income Security Benefits – at present and in the future Today Future

34. Why a Reformed Temporary Income Security Benefit? • A single benefit to support through the whole period, enabling the recipient to focus on job-related activities • Merging/replacing the 3 existing medical and vocational rehabilitation and invalidity benefits (of limited duration) will permit a more flexible use of means/measures across “groups” of recipients • Harmonizing and simplifying the present rules, facilitates a more effective welfare system • Introducing the possibility to allocate resources from the administration of benefit payments towards follow-up activities and active measures

35. 2010 • 470 NAV offices established in all municipalities, several in larger cities • 12 administration units enhanced • 20 new administration units established • 5 new pension units established

36. 2010 • Specialisation and automation within the fields of information, administrative support and payment • Transfer of 1550 employees from local offices to special units • Health services transferred from The Labour and Welfare Service to The Health and Social Service • New tools and a new policy on labour, welfare and inclusion • Modernised national insurance scheme • Applied measures towards improving the competence of the employees

37. Possible positive results for individuals, society, public economy and finances and for the public service and administration Some examples: 1 person for 5 years longer in paid employment = approx 500.000 NOK higher life income 3.000 persons for 5 years longer in paid employment = 3 billion NOK ”society output” 30.000 fewer disability pensioners (10 %) = 20 billion NOK reduction of the budget costs = 3 % of total state budget All wearing the same uniform shoot towards the same goal! Get it! What if we succeed?