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Copper prints cylinder for a Norwegian banknote. Photo: Norges Bank/Katrine Lunke.

Copper prints cylinder for a Norwegian banknote. Photo: Norges Bank/Katrine Lunke.

The Fiscal Budget

The annual Fiscal Budget – or simply the Budget – is one of the Storting’s most important responsibilities. This page provides some information about how and when the Budget is considered and passed.

Read The Appropriations Regulations

Work on the Budget takes up much of the autumn session, which is a particularly busy time of year for the MPs.

The Fiscal Budget Procedure

The Constitution states that the Storting is the final authority in matters concerning the finances of the State - expenditures as well as revenues. This means that it is the Storting’s job to allocate money to the Government through the annual Fiscal Budget. The Storting does not just permit funds to be spent for specific purposes; it also has the power to order such expenditures. The rules which stipulate the form of the Budget are laid down in the Appropriations Regulations, while the procedure for adopting the Budget is set out in section 43 of the Storting's Rules of Procedure.

When the Storting convenes in the autumn, the Budget is always the first item of business for consideration. The proceedings to adopt the Budget take most of the autumn session.

The Government's proposition

The Fiscal Budget is probably the most important tool of government available to the Storting and the Government. Through the Budget, the guidelines for the activities of the State for the coming year are drawn up. Proposition No. 1 (the "Yellow Book") must be submitted by the sixth day of the new session. At this time, the Minister of Finance appears in Parliament to present the Government’s Budget proposal in the Budget Statement. The Budget Statement forms much of the basis for the following Budget debate.

Before the Budget is submitted to the Storting, it undergoes an exhaustive procedure which involves all branches of the government administration.

After the deliberations between the Government and the ministries have been concluded, the Ministry of Finance sets up a complete Fiscal Budget proposal, which includes the National Insurance scheme. After the Budget receives the official approval of the King in Council, it is submitted to Parliament as Proposition No. 1 to the Storting.

The Presidium

In the Storting, the Presidium is responsible for assigning the various chapters of the Budget to appropriate standing committees. The recommendation concerning this process is dealt with and passed by the Storting in plenary session. The Presidium also sets the deadlines for when the committees have to finish their work and submit their Budget recommendations.

How the parliamentary party groups consider the Budget

The parliamentary party groups in opposition draft their own alternative Budgets. Based on the Government’s Budget proposal, these alternative Budgets form the basis of the respective party groups’ Budget proposals. The opposition parties’ alternative Budgets are not published as separate documents, but are added as remarks to the standing committees’ Budget recommendations.

One of the ways in which the parties can prepare for the Budget negotiations is to send questions about the Budget proposal to the ministries. This process helps each party to clarify its most important views and priorities before the negotiations in the Finance Committee start. In the time leading up to the negotiations, the party groups present their own budget proposals by contacting the media and holding press conferences. After that, the tug-of-war in the Finance Committee can begin.

The Standing Committee on Finance and Economic Affairs

The Fiscal Budget proceedings are coordinated by the Standing Committee on Finance and Economic Affairs (the Finance Committee, for short). The Finance Committee presents its recommendation on the National and Fiscal Budgets by 20th November at the latest. This recommendation includes a proposed resolution on the Budget’s spending ceilings in line with the expenditure areas laid down by the Storting. The Finance Committee also submits a recommendation concerning taxes and duties, including the block grants to municipalities and counties.

The Storting must deal with these recommendations within one week. The annual Budget debate is held after this. The Storting’s resolution on Budget ceilings is binding for the subsequent consideration of the Budget during the same year.

During the Budget debate, government and opposition parties present their most important arguments for and against the Government’s economic policy. It is at this point that they indicate how much support they are likely to give to the Government. The debate ends with a vote on the proposals submitted in the recommendations. The amounts for all the separate expenditure areas are fixed collectively in a single resolution.

The Standing Committees

Now it is the turn of the standing committees to get down to work. In the period that follows, each standing committee submits its recommendations on spending within the expenditure areas it has been allocated. Recommendations must include all chapters and items within each separate expenditure area.

Each standing committee may only make reallocations within the limits that have already been set. This means that increases in expenditure must be matched by decreases in expenditure or by increases in revenue. The standing committees’ Budget recommendations must be dealt with by the Storting by 15th December at the latest. This culminates in the Storting’s final Budget resolution. The amounts for all the separate items within an expenditure area are fixed collectively in a single resolution.

The Budget debate

The recommendations of the individual committees are dealt with in the Storting in plenary. The debates on the individual Budget recommendations have strict time limits. This is to ensure that the entire Budget will be passed on time. The length of the debates varies from four to five hours for the shortest, to nine to ten hours for the longest.

The entire Budget process is subject to a strict time limit. No more than 2½ months may be used to adopt a Budget. In extraordinary cases, such as the change of government in 1997, the time available may be even shorter.

The outcome

The period during the Fiscal Budget process is often extremely hectic. In practice, however, the Storting accepts the Government's proposals, usually with only minor changes. The Government’s proposal and the Storting’s resolution normally differ financially by less than one per cent. The signals given by the different parties in the Storting via their comments and priorities are perhaps of greater political significance, since they may influence subsequent Budgets.

Much of the spending which the Storting approves is in the form of block grants or "umbrella appropriations". This means that it is the Government’s responsibility to make the final decisions about exactly how the funds are to be applied.

If the Government wants to make amendments to the separate budgets of the individual ministries, it must submit its proposed changes by 15th May during the fiscal year concerned. This is done in the white paper on the Revised National Budget. The Finance Committee must submit its recommendations on such amendments by the second Friday in June at the latest.

Last updated: 24.11.2021 10:33