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Elisabeth Svantesson, the Finance Minister (M), explained last week that the state was selling Bilprovningen – Sweden’s largest inspection company – because “there is no obvious reason for the state to own this company.” She said that the state should regulate and control the market first, but that it’s good for others to own.
Svenska Spel, the state-owned gambling company, is no exception.
Bilprovningen og Svenska Spel are two of the few state-owned companies that are not suitable for the government to own. This is because the companies compete in the same market as a large number of private companies. The state regulates both the company it owns and all other companies.
Never be both a referee and a player in the same game. This arrangement, no matter how many responsibilities are distributed between various authorities and functions within the state is designed to undermine trust in the neutrality of the state. Listening to government officials, do we hear the neutral judge or the director of the state casino?
State-owned companies are not guaranteed to perform better than other companies in a competitive market. The fines imposed by the Swedish Gambling Authority on Svenska Spel for different violations of the Gambling Act totaled over 100 million kronor this year. This is more than any other gambling firm on the market.
It’s not the biggest scandal of the year in the gambling industry. The scandal of the year has been a gambling firm owned by a party. Imagine if the Swedish government owned a gambling firm that was involved in a scandal with the same dignity. The government faces this risk every day, for example, as the owner of Svenska Spel. With the illegal gambling advertisement when Trisslotten on TV4 is scratched.
When the state owns companies that operate on competitive markets, the public debate over how gambling should be controlled is shortened when Svenska Spel and their representatives speak up and tell the Riksdag and government how it should be done. In a democratic system, the order must be reversed: the Riksdag or the government should have the authority to tell Svenska Spel what to do.
Before the last election, the two largest parties in government base in terms the number of Riksdag seats – the Moderates & Sweden Democrats – were very clear about what they planned to do with Svenska Spel if an election victory was achieved: privatize state ownership. The government was told to focus on its role as a legislator, and monitor the market participants to ensure they comply with the laws and regulations.
Svenska Spel’s privatization is not going to be delayed any longer, as the sale of AB Bilprovningen is a sign that the government is ready to put its words into action. The state’s role in judging the gambling industry is more important than the inspection of cars.
A sale must be conducted in accordance with all the rules to ensure that you get as much money as possible for your company. Sale proceeds can be used to fund important government investments, such as infrastructure. We would all benefit from this sale.
Gustaf Hoffstedt
Secretary General of BOS, The Swedish Trade Association for Online Gambling
