13 Stability and Change in Scandinavian Welfare: The Nonprofit Sector as a Buffer against For-Profit Expansion

Abstract

In 1984, as a reaction to conservative calls for the introduction of for-profit providers in day care for children, the ruling Swedish social democrats passed a special law prohibiting the flow of any public money to private day care for children. This was in spite of long queues and a general inability to offer sufficient public supply (Rothstein, 1993). This hostility to for-profit providers was also reflected in the statement by prime minister Olof Palme that the public school was 'a spearhead into the future classless society', something which may explain why the share of children in private schools was as low as 0,2 per cent in the mid-1980s (Blomqvist, 2004, p. 157). Today, approximately 30 years later, for-profits have gained a market share of around 20 percent of welfare services in Sweden, and their share of welfare is growing at accelerating speed (Sivesind, 2017). In Stockholm, users of public home care services for the elderly must choose from among more than 100 providers in each district. The competition has led to almost 40 percent of the providers having names that starts with an A, and some even choosing names beginning with AAA, to increase their likelihood of being chosen (Szebehely, 2014). This example documents that changes have taken place in some of the core institutional arrangements in the Nordic welfare system. Interestingly, this change is not paralleled in Denmark and Norway, prompting questions about what conditions have made Sweden take, in some ways, a radically different path than their Scandinavian peers. This is in spite of the welfare goals in all three countries increasingly focusing on democratic values, such as personal autonomy, personal choice and moving power from public bureaucrats to the citizens (Rostgaard, 2015, p. 4). The means for reaching these goals is what is different. Looking at this period of time, from the 1990s to today, in this chapter I use schools and elderly care as examples to show the depth of the changes, explain the institutional prerequisites for change and reflect upon the future of the Scandinavian welfare model. The changes are important because the nature of the welfare services constitutes a main outcome of the Scandinavian electoral democracy. It is thus important to understand the room elected representatives have to make choices about the welfare mix-the division of public, nonprofit and for-profit providers-and the context where they make such decisions. Furthermore, inasmuch as providers from the different sectors are different, it can spur a plurality of service content that enables citizens to get services in accordance with their individual preferences at the same time as it may challenge important values such as equity.