Study on State asset management in the EU€¦ · Management Agency1) was designed to produce a...

Written by KPMG and Bocconi University February 2018

Study on State asset management in the EU

Final study report for Pillar 3 – Sweden

Contract: ECFIN/187/2016/740792

2

EUROPEAN COMMISSION

Directorate-General for Economic and Financial Affairs

Directorate Fiscal policy and policy mix and Directorate Investment, growth and structural reforms

European Commission

B-1049 Brussels

Study on State asset management in the EU – Pillar 3 Sweden

3

Sweden

This country fiche presents a qualitative overview of the mix of governance models

and investment strategies implemented by the Swedish general government to manage its assets portfolio.

1. MAPPING OF THE GOVERNANCE OF THE PORTFOLIO OF ASSETS

Sweden has three levels of domestic government:

national;

regional. Sweden is divided into 20 counties. Political tasks at this level are undertaken by the county councils, which are responsible for the tasks that

cannot be handled at the local levels by municipalities but which require coordination acorss a larger region (e.g. health care);

local. Sweden is divided into 290 municipalities, each with an elected assembly

or council. Municipalities are responsible for a broad range of facilities and services (e.g. housing, roads, water supply and waste-water processing).

Throughout this country fiche, we re-cluster these three tiers into two categories, i.e. the “central government”, which includes the national government, and the “local

governments”, which include both the regional governments and the local governments.

Currently, there is no specific, unique government entity responsible for managing the government’s asset portfolio as a whole (including both Financial and Non-financial

assets). However, the general governance model can be defined as “centralised”. More

in details, as far as financial assets are concerned, the Ministry of Enterprise and Innovation is responsible for 40 out of 48 centrally-owned Public Sector Holdings

(PSHs). By contrast, regarding Non-financial assets, the relevant ministries, central public bodies, and central PSHs are responsible for the large portion of the Swedish

general government’s Non-financial asset portfolio.

There is no unique, comprehensive and consolidated National public data source

covering all assets in the government’s portfolio. By contrast, many ad hoc registries and information sources on government’s assets are made available are kept updated

by many relevant public bodies.

The year-end financial statement established by the Swedish National Financial Management Agency1) was designed to produce a comprehensive record of all

Government-owned assets. The year-end financial statements cover the Parliament, ministries, and 250 government agencies. In addition, PSHs’ equity value is reported

in the balance sheet together with a note detailing the value of each company. However, local governments are not covered and consolidated in the year-end

financial statements2.

1 Ekonomistyrningsverket

2 Moretti, D. (2016). Accrual practices and reform experiences in OECD countries. Results of the 2016 OECD

Accruals Survey. OECD Journal on Budgeting, 16(1), pp. 9-28.


4

1.2. Financial assets

The PSHs owned by the Swedish general government operate in a broad spectrum of

the domestic economy. This variety is reflected in the patterns of ownership and governance. For example, some financial assets are owned by the central

government; others by the local governments.

The Swedish government has a mandate from the Swedish Parliament to actively

manage investment in PSHs. The Swedish government annually publishes the state’s ownership policy3 with the aim of defining the overall strategy regarding PSHs.

The Ministry of Enterprise and Innovation4 is responsible for managing the majority of

the Swedish PSHs through the Investment management organisation. In addition, other ministries, central and local governments, and other bodies owning a majority

stake in PSHs are responsible for operational decisions.

With respect to financial assets in government’s equity portfolio, the five most

important sectors in terms of Value Added (VA) generated by PSHs5 are:

1. D – Electricity, Gas, steam and air conditioning supply;

2. M – Professional, scientific, and technical activities;

3. J – Information and communication;

4. H – Transportation and storage;

5. L – Real Estate activities.

Table 1 Governance regimes: Financial assets, Sweden

Owners of the

asset

Both the central and the local government participate

in the companies’ capital.

C1

D1

Most important sectors in terms of VA (sectors D

– Electricity and gas, M – Professional activities, J

- Information, H - Transportation, and J – Real Estate): the majority of PSHs are owned by the local

governments, although the central government retains minor ownership stakes.

Bodies

responsible for the strategic

and investment decisions

The Ministry for Enterprise and Innovation is

responsible for outlining the strategic and investment decisions for the central government’s PSHs. It

operates through an organisation specialised in corporate governance and company management, to

ensure long-term value creation in the government’s equity portfolio. The Minister for Enterprise and

Innovation operates in accordance to other ministries

C1

3 For more details please see Government Offices Of Sweden. Available at:

http://www.government.se/reports/2017/06/the-states-ownership-policy-and-guidelines-for-state-owned-

enterprises-2017/ [Accessed 27th October 2017]. 4 Näringsdepartementet. 5 The five most important sectors in terms of VA generated by PSHs have been mapped in Pillar 1. For

industry classification we rely on data provided by Bureau van Dijk (BvD) Orbis, which in turns gets its data

from other service providers and bases industry classification on the NACE codes provided.

http://www.government.se/reports/2017/06/the-states-ownership-policy-and-guidelines-for-state-owned-enterprises-2017/



5

and local governments if involved in the ownership of each PSH.

Most important sectors in terms of VA: the relevant

local governments and each relevant ministry are responsible for strategic decisions on PSHs operating

within their jurisdiction in compliance with the strategic

framework outlined by the Ministry of Finance and Civil Service.

Bodies

responsible for the operational

decisions

PSHs are managed by the Government Offices or other

state agencies. Most of the companies are managed by a special investment organisation for state-owned

companies within the Ministry of Enterprise and Innovation, which has administrative responsibility for

the majority of the PSHs.

For PSHs owned the local governments, the relevant

local governments are responsible for the operational decisions in compliance with the criteria outlined by the

Local Government Act6. Furthermore, local

government-owned PSHs are governed following the principles outlined by the Swedish Association of Local

Authorities and Regions (SALAR), which is an organisation made up of all the Swedish local

governments7. SALAR also owns an investment company, i.e. Kommuninvest, which publishes

guidelines for municipalities' policies in order to benefit from preferential loans and financing8.

C1

D1

Most important sectors in terms of VA: since the

majority of PSHs operating in these sectors are owned by local governments, local governments are

responsible for operational decisions.

National public data sources

The Swedish government submits an annual communication to the Parliament, which provides for

an account of the management of state-owned

companies in the past year. This “Annual Report of state-owned enterprises” is published and approved by

the Swedish government. It is a comprehensive dataset of all the information regarding the state-owned equity

portfolio and it is published in June each year.

C1

6 Local Government Act. Available at:

https://skl.se/download/18.a827c16146db10f89a4e39c/1404458324781/Local_government_act.pdf

[Accessed 14th February 2018]. 7 For more information, please see

https://skl.se/demokratiledningstyrning/driftformervalfrihet/kommunalaforetagbolag.393.html [Accessed

14th February 2018]. 8 For more information, please see http://kommuninvest.se/for-kunder/utlaning/ [Accessed 14th February

2018].

Legend

C3C1 C2= Central government

= Central public authority

= Central company-typestructure

D1 = Local governments

D2 = Local public authorities

D3 = Local company-typestructure

= Private body

PM

https://skl.se/download/18.a827c16146db10f89a4e39c/1404458324781/Local_government_act.pdf

https://skl.se/demokratiledningstyrning/driftformervalfrihet/kommunalaforetagbolag.393.html

http://kommuninvest.se/for-kunder/utlaning/


6

Source: KPMG elaborations.

The network graphs in the table above highlight the main bodies involved for each role of the (a)

responsibility chain (e.g. the bodies owning the assets, the bodies responsible for operational

decisions), for each asset cluster in the government’s asset portfolio. These models may not apply to all

the individual assets within the cluster.

For some clusters of assets the responsibility for some aspects of the governance regime is spread (b)

between more bodies at different levels of centralisation. Therefore, we represent these cases using two

“network graphs” representing these bodies.


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1.3. Non-financial assets

Airports

Table 2 Governance regimes: Airports, Sweden

Owners of the asset

Currently, ten of the main Swedish airports are owned by Swedavia AB, which is a PSH fully owned by the

central government; its network includes the following airports: Are Oestersund Airport, Goeteborg Landvetter

Airport, Kiruna Airport, Lulea Airport, Malmoe Airport, Ronneby Airport, Stockholm-Arlanda Airport,

Stockholm-Bromma Airport, Umea Airport, and Visby Airport9. Other airports are owned by the local

governments where these airports are located.

C3

D1

Bodies responsible for

the strategic


The Ministry of Enterprise and Innovation is responsible for strategic and investment decisions regarding the

Swedish airport network. It has prepared the Swedish

Aviation Strategy, which outlines the transport policy objectives for airport both in the long and in the short

term.

C1

Bodies


decisions

The ten most important Swedish airports are managed

by Swedavia AB that is therefore responsible for operational decisions regarding these airports.

In addition, the local governments are responsible for

operational decisions on airports under their jurisdiction.

C3

D1


Transport Analysis, a Swedish government agency responsible for transport policy analysis, is responsible

for annually and quarterly collecting data about the

airport network10 They report key information on airport infrastructures (e.g. the length and the surface

of the runways in Swedish airports) and traffic (e.g. freight loaded and unloaded at Swedish airports). The

same information about the airport traffic in Sweden is reported by Statistics Sweden (i.e. the official statistical

institute).

C2









9 It is important to point out that Swedavia owns, among its assets, the three largest airports in Sweden. 10 For the list of the information mapped by Transport Analysis, please see

http://www.trafa.se/en/?ml=3582,2#3582 [Accessed 14th September 2017].

Legend







= Private body

PM

http://www.trafa.se/en/?ml=3582,2#3582


8

Ports

Table 3 Governance regimes: Ports, Sweden

Owners of the

asset

Most of the Swedish port infrastructure is currently

owned by the local governments where ports are located.

D1

Bodies



The Ministry of Enterprise and Innovation is responsible

for strategic and investment decisions regarding the Swedish port network. It has prepared the Swedish

Maritime Strategy, which outlines the seaport policy objectives both in the long and short term.

C1

Bodies


decisions

Each local government is responsible for operational

decisions related to the port(s) under its jurisdiction.

D2


Transport Analysis, a Swedish government agency responsible for transport policy analysis, is responsible

for annually and quarterly collecting data about seaport traffic (e.g. good handled in Swedish ports). The same

information about the port traffic in Sweden is reported by Statistics Sweden. With regard to the port

infrastructures, there is currently no single, definitive,

public source of information.

C2









Legend







= Private body

PM


9

Roads

Table 4 Governance regimes: Roads, Sweden

Owners of the

asset

Motorways and main roads are owned by the central

government, while other roads are owned by the relevant local governments.

C1

D1

Bodies



The central government is responsible for strategic and

operational decisions regarding the state-owned road network. More in detail, it annually drafts the eleven-

year National Plan for the Transport System, which sets the guidelines for the activity of the Swedish Transport

Administration.

In addition, road infrastructure projects are undertaken jointly by the central government and the relevant

municipal governments: all road constructions must be undertaken pursuant to a road plan, which is jointly

drafted by the relevant County Administrative Board11, the relevant governments, and the relevant

stakeholders.

C1

D1


the operational decisions

The Swedish Transport Administration is directly responsible for operational decisions regarding main

roads. It is a Swedish government agency, directly controlled by the Swedish government and the Swedish

Parliament.

Moreover, the relevant local public bodies are responsible for operational decisions regarding road

infrastructures within their jurisdiction.

C2

D2


The Swedish Transport Administration and Transport Analysis are responsible for keeping and updating the

inventories of the State road network. In addition, Statistics Sweden collects and reports key information

about the road infrastructure (e.g. the length of motorways) and road traffic in Sweden.

C2









11 Länsstyrelsen.

Legend







= Private body

PM


10

Railways

Table 5 Governance regimes: Railways, Sweden

Owners of the

asset

The central government owns the railway tracks in the

country.

C1

Bodies

responsible for

the strategic and investment

decisions

The central government is responsible for strategic and

operational decisions regarding the state-owned

railway network. Specifically, it annually drafts the eleven-year National Plan for the Transport System,

which sets the guidelines for the activity of the Swedish Transport Administration.

C1

Bodies


decisions

The Swedish Transport Administration acts as

infrastructure manager; it is therefore responsible for operational decisions related to the Swedish railway

network.

C2


The Swedish Transport Administration and Transport Analysis are responsible for keeping and updating the

inventories of the State railway network. In addition, Statistics Sweden collects and reports key information

about the railway infrastructure (e.g. the length of railway tracks) and railway traffic in Sweden.

C2









Legend







= Private body

PM


11

Mineral and Energy reserves

Table 6 Governance regimes: Mineral and Energy reserves, Sweden

Owners of the

asset

Mineral and Energy reserves are owned by the central

government12.

C1

Bodies

responsible for


decisions

The central government is responsible for strategic

decisions regarding the Mineral and Energy reserves.

More in detail, it publishes the Minerals Strategy13.

In addition, the Mining Inspectorate is the relevant

authority in charge of granting exploration permits and exploitation concessions for Mineral and Energy

reserves in the country. It shall submit concession trials to the government only in certain situations, e.g.

if the resource is considered to be strategic14.

C1



Many companies are given the rights to exploit Swedish mineral and energy resources in concession.

C3

D3

National public

data sources

There is currently no single, definitive, public source of

information about the value of Mineral and Energy reserves nor about the bodies having the concession

for their exploitation.

n.a.






12 In compliance with:

1. Continental Shelf Act of 1966. Act n. 314 of the 3rd June 1966 concerning the continental shelf.

Available at:

http://www.un.org/depts/los/LEGISLATIONANDTREATIES/PDFFILES/SWE_1966_Act.pdf [Accessed

04th September 2017];

2. Mineral Acts of 2006. Available at: https://www.ecolex.org/details/legislation/minerals-act-lex-

faoc042438/?q=&xsubjects=Mineral+resources&xcountry=Sweden&xregion=Northern+Europe&xd

ate_min=&xdate_max= [Accessed 04th September 2017];

3. Natural Gas Act of 2005. Available at: https://www.ecolex.org/details/legislation/natural-gas-act-

2005403-lex-

faoc131842/?q=&xsubjects=Mineral+resources&xcountry=Sweden&xregion=Northern+Europe&xd

ate_min=&xdate_max [Accessed 04th September 2017]. 13 Sweden’s Minerals Strategy For sustainable use of Sweden’s mineral resources that creates growth

throughout the country. Available at:

http://www.government.se/49b757/contentassets/78bb6c6324bf43158d7c153ebf2a4611/swedens-

minerals-strategy.-for-sustainable-use-of-swedens-mineral-resources-that-creates-growth-throughout-the-

country-complete-version [Accessed 25th September 2017]. 14 As explain in Chapter 8, Section 2 (1), of the Minerals Act.

Legend







= Private body

PM

http://www.un.org/depts/los/LEGISLATIONANDTREATIES/PDFFILES/SWE_1966_Act.pdf

https://www.ecolex.org/details/legislation/minerals-act-lex-faoc042438/?q=&xsubjects=Mineral+resources&xcountry=Sweden&xregion=Northern+Europe&xdate_min=&xdate_max



https://www.ecolex.org/details/legislation/natural-gas-act-2005403-lex-faoc131842/?q=&xsubjects=Mineral+resources&xcountry=Sweden&xregion=Northern+Europe&xdate_min=&xdate_max




http://www.government.se/49b757/contentassets/78bb6c6324bf43158d7c153ebf2a4611/swedens-minerals-strategy.-for-sustainable-use-of-swedens-mineral-resources-that-creates-growth-throughout-the-country-complete-version




12




Other natural resources

Table 7 Governance regimes: Other natural resources, Sweden

Owners of the asset

Other natural resources in Sweden are owned by both the central government and the local governments15.

C1

D1

Bodies



The Ministry of the Environmental and Energy16 is the

main regulatory body responsible for both proposing and then implementing the government's policy on

Other natural resources. C1

Bodies


decisions

The relevant, executive agencies of the Ministry of the

Environmental and Energy are responsible for implementing the strategic and investment decisions

on the Swedish government’s Other natural resources.

In addition, the relevant local public bodies are

responsible for managing Other natural resources under their ownership.

C2

D2

National public

data sources

Statistics Sweden periodically collects and reports some

key information about Other natural resources (e.g. the land and water area by region and type of area).

C2









15 Environmental Code (2000: 61). Available at:

http://www.government.se/contentassets/be5e4d4ebdb4499f8d6365720ae68724/the-swedish-

environmental-code-ds-200061 [Accessed 14th November 2017]. 16 Miljö- och energidepartementet

Legend







= Private body

PM

http://www.government.se/contentassets/be5e4d4ebdb4499f8d6365720ae68724/the-swedish-environmental-code-ds-200061

http://www.government.se/contentassets/be5e4d4ebdb4499f8d6365720ae68724/the-swedish-environmental-code-ds-200061


13

Dwellings, Buildings other than dwellings

Table 8 Governance regimes for Buildings cluster, Sweden

Owners of the

asset

Assets falling into this cluster can be owned either by

the central government or the local governments.

C1

D1



decisions

The Parliament is responsible for outlining the principles for the administration and disposal of assets

in the Swedish government’s portfolio17.Residential and non-residential buildings are administered by the

government, in so far as these are not intended for authorities under the Parliament, or have been set

aside in law for special administration. Furthemore, the government may not assume financial obligations on

behalf of the state, unless it was previously authorised

by the Parliament.

C1

Bodies

responsible for


The Swedish central government is the body

responsible for managing its own public real estate,

such as renting space, facility management and real estate development. Furthermore, following the

significant reform since 1990, special-purpose buildings were allocated to a number of government-controlled

units. Currently, there are four such units (organised in the form of companies):

Akademiska Hus, which owns and manages buildings occupied by universities and, more

generally, other high education institutes;

Statens Fastighetsverk, which owns and manages heritage buildings and buildings

occupied by cultural institutions (museum, theatres) and most government quarters;

Specialfastigheter AB, which owns and manages prisons and similar institutions;

Fortifikationsverket, which owns and manages buildings and other real estate occupied by the

armed forces.

In addition, local governments are responsible for operational decisions regarding their own Dwellings and

Buildings other than dwelling.

C1

D1

17 Art. 9 of the Constitution of the Kingdom of Sweden. Available at:

http://www.wipo.int/edocs/lexdocs/laws/en/se/se122en.pdf [Accessed: 04th September 2017].

http://www.wipo.int/edocs/lexdocs/laws/en/se/se122en.pdf


14


Statistics Sweden annually collect some information about Dwellings and Buildings other than dwellings18 in

Sweden (e.g. the dwelling stock).

C2









18 For more detail about the information on Buildings reported by the National Institute of Statistics, please

see http://www.ine.es/en/welcome.shtml [Accessed 13th September 2017].

Legend







= Private body

PM

http://www.ine.es/en/welcome.shtml


15

Figure 1 Asset-responsibility chain and ownership matrix for the cluster of assets in government’s portfolio, Sweden


n.a. = not available.

Centr. Gov. = Central government; Local Gov. = Local government; Min. for Enterprise = Ministry for

Enterprise and Innovation; Swed. Tran. Adm. = Swedish Transport Administration; Local PB = Local public

bodies; Min. of Environ. = Ministry of Environmen.

For more detail about the clusters of governance regimes, please see Methodological Notes. (a)

The network graphs in the table above highlight the main bodies involved for each role of the (b)




For some clusters of assets the responsibility for some aspects of the governance regime is spread (c)



In light of the analysis presented earlier and summarised in Figure 1, the overall governance regime for the Swedish government’s asset portfolio can be defined as

centralised both in terms of ownership and in terms of responsibility for strategic and investment decisions on the assets.

In particular, the central government owns the majority of state-owned assets and it also has responsibility for strategic and financial decisions relating to assets in its

portfolio. More in detail, the relevant ministries prepare the strategic plans for assets

under their jurisdiction (e.g. the Ministry of Enterprise and Innovation has launched the “Swedish Maritime strategy - for people, jobs and the environment” for ports).

These plans represent the strategic and legislative framework within which different

Asset cluster

Role of the body

Responsible for the operational

decisions

Responsible for the strategic

decisions

Owner of the asset

Financial assets

Airports

Ports

Roads

Railways

Mineral and Energy

reserves

Other naturalresources

Dwellings, Buildings otherthan dwellings

Centr. Gov.

C1

Local Gov.

D1

No

n –

finan

cia

lassets

Statistical Office

C2

ConcessionairePSHs

C3 D3

Centr. Gov.

C1

Local Gov.

D1

Centr. Gov.

C1

Local Gov.

D1

Centr. Gov.

C1

Statistical Office

C2

Min. for Enterprise

C1

Centr. Gov.

C1

Local Gov.

D1

Min. for Enterprise

C1

Centr. Gov.

C1

Local Gov.

D1

Swed. Tran. Adm.

C2

Centr. Gov.

C1

n.a.

Local Gov.

D1

Executive agencies

C2

Centr. Gov.

C1

Local Gov.

D1

Centr. Gov.

C1

Min. for Enterprise

C1

TransportAnalysis

C2

Local Gov.

D1

Swedavia

C3

Local Gov.

D1

Swedavia

C3

TransportAnalysis

C2

Min. for Enterprise

C1

Port authorities

D2

Local Gov.

D1

Centr. Gov.

C1

Local Gov.

D1

Swed. Tran. Adm.

C2

Local PB

D2

Swed. Tran. Adm.

C2

Swed. Tran. Adm.

C2

MiningInspectorate

C2

Min. of Environ.

C1

Parliament

C1

Legend


= Central public body



D2 = Local public body


= Private bodyPM



16

“centralised” authorities (e.g. the Swedish Transport Administration for network infrastructures) and PSHs (e.g. Swedavia AB for the ten most important airports)

make operational decisions.

2. MAPPING OF THE INVESTMENT STRATEGY OF THE PORTFOLIO OF ASSETS

The Swedish government does not have a unique document outlining the investment strategy for all the assets. As it will be described in the following two sections, Sweden

has been promoting many strategic initiatives regarding its public assets management in recent years. These initiatives have been leading to a change in the governance

regime for part of the assets in the government’s portfolio.

2.1. Financial assets

The Swedish government has a mandate from the parliament to actively manage

state-owned enterprises with the aim of ensuring the optimal long-term value performance. However, the Parliament keeps control over important strategy decisions

regarding financial assets.

Specifically, the Swedish government annually publishes the state’s ownership

policy19, which defines the overall strategy regarding Swedish PSHs. The current ownership policy was adopted on the 22nd December 201620. It applies from 1st

January 2017 and supersedes the previous ownership policy adopted in 2015.

However, despite Sweden having a clear ownership policy, a clear and explicit

privatisation policy or plan does currently not exist. Privatisations are implemented on

a “case–by-case” basis according to the Parliament’s policies and depending on the economic conjuncture. The results of the privatisation process in the country are

shown in Figures 2 and 3 below.



enterprises-2017/ [Accessed 27th October 2017].

20 The state’s ownership policy 2017. Government Offices of Sweden (2017). Available at:

http://www.government.se/49f639/contentassets/c6382135343d45fe8685ab7fa53a2fa3/the-states-

ownership-policy-and-guidelines-for-state-owned-enterprises-2017.pdf [Accessed 27th October 2017].



http://www.government.se/49f639/contentassets/c6382135343d45fe8685ab7fa53a2fa3/the-states-ownership-policy-and-guidelines-for-state-owned-enterprises-2017.pdf

http://www.government.se/49f639/contentassets/c6382135343d45fe8685ab7fa53a2fa3/the-states-ownership-policy-and-guidelines-for-state-owned-enterprises-2017.pdf


17

Figure 2 Privatisations across markets by value and by number, 1980–2014, Sweden

Sources: KPMG elaborations on data from the Fondazione Eni Enrico Mattei (FEEM) database, 1980-2014.

The value of privatisations refers to the sum of the values of the transactions agreed between a public (a)

body (seller) and a private entity (bidder) for that period.

The number of privatisations refers to the total number of transactions for that period. (b)

Sectors that are below the 5% threshold in terms of both total value of the transactions and number of (c)

deals have been included in the aggregate cluster “Other”.

24.1%

0.8%

0.9%

20.0%

41.4%

6.0%

6.7%

Transportation Industry

Other

Manufacturing

Telecommunications

Finance & Real Estate Industry

Services Industry

Utilities

3.9%

15.7%

24.5%

6.9%

17.6%

6.9%

24.5%

By value By number

48.6Eur Bn

102Deals

18

Figure 3 Privatisations across markets over time by value, 1980–2014, Sweden

Sources: KPMG elaborations on data from the Fondazione Eni Enrico Mattei (FEEM) database, 1980-2014.

(a) The value of privatisations refers to the sum of the values of the transactions agreed between a public body (seller) and a private entity (bidder) for that period

According to data retrieved for the FEEM database, there were no privatisations during the years 1980 - 1985. (d)

1,000

0

2,000

9,000

20,000

18,000

19,000

17,000

16,000

11,000

14,000

5,000

8,000

10,000

12,000

6,000

13,000

4,000

15,000

3,000

7,000

1.2%

28.8%2.7%

10.8%

6.6% 0.1%

1.2%

18.9%19.7%

6.7%

27.8%

10.5%

5.0%2.3%

2.8%

59.9%

2.5%

43.4%

0.4%

51.4%

1986 - 1990

100.0%

1980 - 1985

76.6%

1991 - 1995

0.2%

0.9%

1.1%

14.2%

1996 - 2000

33.4%

67.2%

2011 - 20142006 - 2010

3.6%

2001 - 2005

Eur Mn

Transportation Industry

Manufacturing

Finance & Real Estate Industry

Telecommunications

Trade Industry

Services Industry

Utilities


19

2.2. Non-financial assets

The Swedish government has recently presented an infrastructure bill – i.e. the

“Infrastructure for the future – innovative solutions for strengthened competitiveness and sustainable development”21 – which includes proposals on the financial framework

and the strategic guidelines for the next 2018-2029 planning period. The proposed financial framework amounts to 622.5 SEK Bn (approximately 65.1 Bn Eur), which is

over 100 SEK Bn (approximately 10.5 Bn Eur) more than the current plan.

In the following sub-sections more details on the Swedish investment strategy relating

to non-financial assets are provided.

Airports

Swedavia AB is a PSH that owns, operates and develops basic infrastructures of the 10

most important Swedish airports. As reported in its annual report, Swedavia AB operates since April 2010, when the Civil Aviation Administration (i.e. Luftfartsverket –

LFV) transferred the ownership and the responsibility for managing these airport to Swedavia AB.

As far as the current investment strategy is concerned, in 2017, the Swedish government has launched the “Swedish Aviation strategy” 22, in which seven actions

are identified, as follows:

1. increase accessibility in Sweden and internationally;

2. strengthen Arlanda Airport as a hub and major airport;

3. reduce the environmental climate impact of aviation;

4. deliver a high level of aviation safety with goal-based regulations;

5. guarantee fair conditions and healthy competition;

6. make Sweden a nation with strong research and an innovative aviation

industry;

7. increase exports of Swedish goods and services.

In this context, investments in the aviation sector mainly come from the Swedish

government, which largely excluded private funding from this sector.

Ports

As reported by Transport Investment Agency, the Swedish ports are organised as integrated companies as the result of a merger between the former port authority and

the local companies. This reform was aimed at boosting efficiency and reducing cost23.

21 Ministry of Enterprise and Innovation (2016). Infrastructure for the future – innovative solutions for

strengthened competitiveness and sustainable development. Available at:

http://www.government.se/4af2b7/contentassets/cd607378923c4bb0a22fd66fee35d2b8/20161212_faktabl

ad_infraprop_eng_webb.pdf [Accessed 12th September 2017].

22 A Swedish aviation strategy, Ministry of Enterprise and Innovation (2017). Available at:

http://www.government.se/49192f/contentassets/f3314772d19b47119647d98034c34ae0/2017_flygfaktabl

ad_eng_webb-2.pdf [Accessed 26th October 2017].

http://www.government.se/4af2b7/contentassets/cd607378923c4bb0a22fd66fee35d2b8/20161212_faktablad_infraprop_eng_webb.pdf

http://www.government.se/4af2b7/contentassets/cd607378923c4bb0a22fd66fee35d2b8/20161212_faktablad_infraprop_eng_webb.pdf

http://www.government.se/49192f/contentassets/f3314772d19b47119647d98034c34ae0/2017_flygfaktablad_eng_webb-2.pdf

http://www.government.se/49192f/contentassets/f3314772d19b47119647d98034c34ae0/2017_flygfaktablad_eng_webb-2.pdf


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In November 2015, the Ministry of Enterprise and Innovation launched the “Swedish Maritime strategy - for people, jobs and the environment”24 which outlines the

strategy for the following years in order to create a competitive, innovative, and sustainable maritime sector that could contribute to boost employment and reduce

environmental impact.

Roads

With regard to the current investment strategy, the Swedish Transport Agency launched the National Road Plan for 2014-2025, which allocates 522 Bn SEK

(approximately 55 Bn Eur) of the state budget to the road network.

In addition, as mapped in Section 1, road infrastructure projects are undertaken jointly by the central government and the relevant local governments: all projects

must be undertaken pursuant to a road plan jointly drafted by the County Administrative Board, the relevant governments (i.e, municipalities), and the relevant

stakeholders. The municipalities can contribute towards the investments, although the contribution cannot exceed 50% of the financing.

Moreover, private investors do not make investments in the Swedish highway network: all funding comes from the central government or the relevant municipalities'

coffers.

Railways

The total amount of investments in operations and maintenance of railways is

proposed to increase by 47% and amounts to 125 Mn SEK (13 Bn Eur). The Swedish government aims at increasing the share of rail and shipping in long-distance freight

transport.

In addition, increasing resources is expected to enable an improvement of standards

in the existing railway system. The infrastructure plan identifies the need for both greater maintenance and reinvestments in large parts of the railway network. In fact,

the government plans to construct new main lines for high-speed trains to connect

Stockholm, Gothenburg and Malmö.

Moreover, the Swedish Transport Administration set two main goals:

to increase the use of new technologies (e.g. digitisation and automation) to contribute to a more intelligent use of existing infrastructure and to decrease

the burden on the transport system;

to broaden investments in renewable energy to replace fossil fuels in the

medium term, in a cost-effective manner25.

23 Västerbotten Investment Agency (VIA). Infrastructure in Sweden. Available at:

http://viavasterbotten.se/regional-facts/sweden/infrastructure/ [Accessed 25th October 2017].

24 A Swedish maritime strategy – for people, jobs and the environment. Regeringskansliet (2015). Available

at: http://www.government.se/information-material/2015/12/a-swedish-maritime-strategy/ [Accessed 25th

October 2017]. 25 Ibid.

http://viavasterbotten.se/regional-facts/sweden/infrastructure/

http://www.government.se/information-material/2015/12/a-swedish-maritime-strategy/


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Dwellings, Buildings other than dwellings

In the early 1990s, the central government reorganised the structure of their real

estate management system. Special purpose buildings (e.g. prisons, universities) and general office buildings, which were previously owned, built and maintained by the

Central Building Authority, were transferred to different government-controlled units. These public bodies are organised both as joint-stock companies and as government

authorities. Currently, there are four such units: Akademiska Hus (universities and other kinds of higher education), Statens Fastighetsverk (heritage buildings and

buildings occupied by cultural institutions, e.g. museums, theatres), Specialfastigheter

AB (prisons and similar institutions), and Fortifikationsverket (buildings and other real estate used by armed forces).

Each of these units has some common economic objectives and targets, as follows:

1. ensuring a certain rate of return on the value of the properties;

2. keeping the quality of properties up to standards;

3. acting as a professional real estate company.

Nonetheless, the past investment strategy has been largely focused on decentralisation. Conversely, a clear and explicit investment strategy for buildings

within the general government portfolio does not exist. The public bodies owning and

managing Building within the government’s portfolio operate in line with business-oriented criteria.

Mineral and Energy reserves

In 2016, the Ministry of Enterprise, Energy and Communications has published the

“Minerals Strategy”26, which aims at increasing the competitiveness of the Swedish mining and minerals industry so that Sweden would be able to strengthen its position

as the EU’s leading mining nation. According to the “Mining Strategy”, Sweden’s mineral assets are to be exploited in a long-term sustainable way, taking into account

ecological, social and cultural dimensions, so that natural and cultural environments

are preserved and developed.

Other natural resources

The current legislative framework on the Swedish government’s Other natural resources makes it very difficult to infer the general investment strategy for Other

natural resources within government’s portfolio.

3. PERSPECTIVE ON THE EXECUTION OF THE INVESTMENT STRATEGY

From the mapping of the governance regime (Section 1) and the investment strategies (Section 2) for the state-owned asset portfolio, some key insights about the

perspectives on the execution of the investment strategies can be drawn as follows:

26 Ministry of Enterprise, Energy and Communications (2016). Sweden’s Minerals Strategy For sustainable

use of Sweden’s mineral resources that creates growth throughout the country. Available at:

http://www.government.se/contentassets/78bb6c6324bf43158d7c153ebf2a4611/swedens-minerals-

strategy.-for-sustainable-use-of-swedens-mineral-resources-that-creates-growth-throughout-the-country-

complete-version [Accessed 14th November 2017].

http://www.government.se/contentassets/78bb6c6324bf43158d7c153ebf2a4611/swedens-minerals-strategy.-for-sustainable-use-of-swedens-mineral-resources-that-creates-growth-throughout-the-country-complete-version




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the Swedish central government keeps the main responsibility for investment and financial decisions regarding financial and non-financial assets. It defines

the main strategic and investment framework for most assets in its portfolio, through the adoption of some strategic plans;

for the majority of state-owned assets, the private investors’ involvement is very limited; all funding comes from the central government or the relevant

municipalities' coffers.

Currently, there is no publicly available document that defines the destination of the

proceeds from forecasted privatisations.

Figure 4 Matrix of Governance regimes vs Investment strategy by clusters of assets, broad features, Sweden

Source: KPMG elaborations, based on governance regimes and recent observed strategies.

The position of each asset cluster with respect to the “investment strategy” dimension (x-axis) reflects (a)

the general investment strategy adopted by the government for the cluster. The general investment

strategy might not apply to every single asset within the cluster (e.g. the position of the cluster

indicates that the government currently plans to invest/divest, and this does not imply that this applies

to all assets within the cluster).

As Figure 4 shows, the governance regime is mostly “centralised” with regard to those assets for which the central government is responsible for the bulk investments (first

two quadrants on the left of Figure 4). More in detail, the central government contributes towards investments and has a role in managing infrastructures.

By contrast, the governance regime for port infrastructures appears to be the most decentralised one. In fact, local port authorities are responsible for managing port

facilities within their jurisdiction.

Decentralised

InvestmentInvestment with private investors

involvement

Divestment/Fullyprivate investment

Governanceregime

Investmentstrategy

Centralised

Legend

= Financial assets = Airports

Not clearinvestment

strategy pattern

= Ports = Roads = Railways= Mineral and Energy reserves

= Other naturalresources

= Buildings


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4. SYNTHESIS OF STRENGTHS, WEAKNESSES, OPPORTUNITIES AND RISKS

Financial assets

Strengths/Opportunities:

o the Swedish government has a mandate from the Swedish Parliament to actively manage the state Financial assets. The Swedish government

annually publishes the state’s ownership policy27 with the aim of defining the overall strategy regarding PSHs;

Non-Financial assets

Strengths/Opportunities:

o the Swedish government has not transferred the ownership and the responsibility for operational decisions in the hands of a few public

bodies that are organised as PSHs. It keeps responsibility for the most

important decisions regarding the management of these assets by supervising their management and investment strategy;

o there is no unique document or law outlining the government’s general investment strategy for the assets portfolio as a whole. At the same

time, the Swedish government has launched many strategies covering significant portions of the government’s asset portfolio and included in

several published reports. Therefore, there is scope for developing and communicating a consolidated strategy plans across all assets;

Weaknesses/Risks:

o there is no unique, comprehensive and consolidated inventory of all the assets in the government’s portfolio.



enterprises-2017/ [Accessed 27th October 2017].



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