OVERSAVING?

Denmark has been on a diet for the past five years. Nowhere more so than in the local authorities, who have been given orders by central government not to spend too much, while at the same time they have had to take on more duties.

Against that background, you would expect the kommuner to be short of money. Far from it, it turns out. They are currently sitting on a collective cash pile of almost Dkr.35 billion, which is more than the Dkr.30.7 billion they had at the end of 2008.

All organisations need to keep a reserve for liquidity purposes, but this is ridiculous. The kommune where I live has a reserve of Dkr.450 million, which is Dkr.11.000 (more than £1,200) for every citizen living here. Even that is is only the fifth biggest cash pile; Copenhagen has almost Dkr.16.000 per person in reserve.

Many people, and not just those of a left-wing persuasion, are questioning whether all this cash squirrelling is a good thing. At a time of both high unemployment and a need to repair and renovate roads and buildings, couldn't at least some of that cash be put to good purposes? Saving is one thing, oversaving is another.

Walter Blotscher