Norway should spend less oil money - finance minister
OSLO, March 10 (Reuters) - Norway should spend even less of its lucrative oil revenue next year, taking advantage of the good times to save up more cash, Finance Minister Sigbjoern Johnsen said on Sunday.
Norway, western Europe's best performing economy, runs huge budget surpluses thanks to a massive offshore oil sector but critics say the government still spends too much money, eroding the country's competitiveness.
"When Norway does well, when the mainland economy performs well... we can spend less oil revenue and save more," Johnsen told public broadcaster NRK a day before the government starts formal work on the 2014 budget.
Johnsen, whose Labour Party trails the Conservatives with elections due in September, said he will propose a budget with lower oil money spending as he expects higher tax income and lower spending on sick leave.
The government can spend up to 4 percent of its saved up oil money each year but the cash pile has grown to $710 billion and critics say that the 2013 spending, targeted at 3.3 percent of the oil money, is simply too much for a country of 5 million.
Norway's competitiveness is stagnating while neighbours are improving and high wages along with a strong currency are a further threat to the economy.
The central bank last year proposed lowering the spending limit to 3 percent, a move the government rejected, saying it would work toward that figure but would not commit to it.
Unlike most of Europe, Norway has no debt or budget deficit and actually runs a budget surplus worth 12 percent of GDP while the saved up oil money equals around 140 percent of GDP.
The oil money, saved in a sovereign wealth fund, is expected to swell to $1.1 trillion by the start of 2020, or about $220,000 per man, woman and child.
(Reporting by Terje Solsvik; Writing by Balazs Koranyi; Editing by Stephen Powell)