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FACTBOX-Norway confidence vote may trigger change of government

Mon, 19th Mar 2018 12:42

By Terje Solsvik

OSLO, March 19 (Reuters) - Norway's parliament votes onTuesday on a motion of no confidence in the justice minister,and the centre-right government is expected to resign if it ispassed.

Sylvi Listhaug, of the right-wing Progress Party, has causeda political storm by accusing the opposition Labour Party - thetarget of a 2011 massacre - of putting terrorists' rights beforenational security.

The outcome of the vote will depend on the small ChristianDemocratic Party (CDP), traditionally a supporter of thegovernment, which on Monday held meetings to decide itsposition.

Snap elections are not allowed, and Norway's next is not dueuntil 2021. Conservative Prime Minister Erna Solberg might beable to form a new cabinet, but the task could fall to Labourleader Jonas Gahr Stoere if the CDP switches sides.

Below is a summary of key policy issues:

SOVEREIGN WEALTH FUND: REFORM DELAY?

With more than $1 trillion saved from Norway's oil and gasindustry, parliament faces key questions over how to organisethe fund and whether to allow investments beyond the foreignstocks, bonds and real estate it currently holds.

The government is due to present a white paper on the fundin April but a change of power would almost certainly lead to apostponement.

Parliament must also decide on whether to back the fund'swish to drop the shares of oil and gas companies from itsbenchmark index, though this issue is unlikely to come to a voteuntil 2019 or later.

PRIVATISATION OR NOT?

The Conservatives are open to reducing the state's stakes inseveral companies, notably in telecoms firm Telenor,where it has permission from parliament to cut its holding to 34percent from 54 percent.

Labour said ahead of last year's election it would askparliament to reverse the Telenor sales permit.

A plan to change the name of oil firm Statoil couldbe at stake. The current oil minister backs the board's plan torename the company Equinor, but Labour has voiced scepticism.

TAXES: UP OR DOWN?

The Conservatives seek cuts in taxes for corporations, onpersonal incomes and in wealth and property taxes. They wanttariff cuts to promote free trade.

Labour vowed in last year's general election to raise taxesfor above-average earners and the wealthy by up to $2 billion toimprove public services and reduce reliance on the sovereignwealth fund.

It blamed its defeat partly on the tax strategy, and said itmight be more reluctant to hike income taxes in the future. Theparty has backed a government plan to cut corporate taxes.

OIL AND GAS: TO DRILL OR NOT?

In return for support from the centrist Christian Democratsand the Liberals, Solberg agreed last year to extend amoratorium on oil and gas exploration around the Arctic Lofotenarchipelago for another four years.

If the government collapses, the agreement will be void, andthe fate of drilling in the area, thought to hold vastresources, will ultimately be decided by parliament.

If the Conservatives were to rule alone, Solberg could seekthe support of Progress and Labour to move towards exploration.

This would further sour relations with the two centristparties, so Solberg may instead use the question of drilling asleverage to win continued support.

Labour has sought a compromise that could see some of thearea opened for drilling, but faces a tricky dilemma becauseopposition within the party to Lofoten exploration is growing.(Editing by Gwladys Fouche and Andrew Roche)

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