Norway's victorious left to increase welfare

Norwegian Labour leader Jens Stoltenberg, triumphant after his "Red-Green" alliance ousted the centre-right government in an election, promised yesterday to spend more of the nation's oil bonanza on welfare.

"We will use Norway's great opportunities and income on the common good - jobs for all, good schools, security and care for the elderly," Mr Stoltenberg, 46, told reporters of Monday's win.

Mr Stoltenberg and his alliance beat the tax-cutting government of Prime Minister Kjell Magne Bondevik even though the economy is booming and UN surveys have rated Norway as the best place in the world to live every year since 2001.

A trained economist who was Norway's youngest Prime Minister from 2000-01, Mr Stoltenberg said Mr Bondevik's tax cuts had betrayed Nordic traditions of equality.

Mr Stoltenberg shared a victory cake in Parliament with leaders of his allies, the Socialist Left and Centre parties, and predicted a slog to work out joint policies. His partners have promised far higher spending of oil cash than Labour.

"There are disagreements and it will be tough," he said. Formal talks on forming a government would start on September 26 and probably last until mid-October, he said.Mr Stoltenberg said a key area of disagreement was whether to allow exploration for oil and gas in the Arctic Barents Sea. Labour is in favour but the two other parties fear any spills could damage the fish stocks and the environment.

And he cautioned that overspending could risk economic overheating in Norway, the world's number three oil exporter behind Saudi Arabia and Russia. He plans to raise taxes by four billion crowns ($627.9 million).

Unlike most nations, Norway has no trouble raising cash to fulfil campaign pledges. A fund saving surplus money for future generations recently reached $190 billion, or about $41,000 for each of Norway's 4.6 million citizens.