BBC : Sweden faces cliffhanger election

Sweden faces cliffhanger election

By Lars Bevanger | BBC News, Stockholm | September 16, 2006

People in Sweden are preparing to go to the polls, in what could be the closest fought general election in decades.

A centre-right coalition is challenging the governing Social Democratic party.

A key issue is whether the country's generous welfare model is in need of reform in order for Sweden to survive in the global economy.

The ruling party has won all but two general elections since 1932 and has governed over a period of record economic growth.

But now, it faces real challenge from the right..

Trading accusations

Opinion polls have shown the centre-right alliance, headed by the conservative Moderate party, consistently neck-and-neck with the Social Democrats.

In the latest one, the challengers are a few points ahead.

Moderate party leader Fredrik Reinfeldt
Moderate candidate Fredrik Reinfeldt says reform is overdue
The opposition says changes to Sweden's rigid labour market and high cost welfare system are long overdue, and promises to cut both employer taxes and unemployment benefits.

It also wants to cut the large social sector, which currently employs 30% of the Swedish job force.

The Moderate leader and candidate for prime minister, Fredrik Reinfeldt, has accused the government of disregarding the high unemployment rate, and for not making sure this country can continue to compete in a global market.

The government maintains the unemployment rate is a low 6%, while the opposition says it is around 10%, taking into account the many people on sick leave and in job training schemes.

The Prime Minister, Goran Persson, has accused the opposition of wanting to destroy job security and make dangerous cuts to the welfare state.

He said this would undermine Sweden's unique social model - a cradle to grave welfare system and strong economic growth.