It is just one year

Today marks one year since the new government began its push for the benefit of the country and nation, as outlined in its policy statement. The guiding principle of the government is the improvement of the living conditions of households in the country and the strengthening of the economy through increased value creation for public benefit. In just one year, significant progress has been made in numerous areas.

Economic development and employment matters

4,000 new jobs (full-time equivalents) have been created since the new government took over. That averages to 11 jobs a day or 16 each working day.

Economic growth accelerated last autumn. The increased growth in the latter part of the year was far beyond forecasts and among the highest known among industrialised nations. It is now expected that growth will increase further this year and next.

Inflation has fallen below the Central Bank's target range for only the second time in a decade, and for the first time, inflation has remained below the target range for several consecutive months. The result is increased purchasing power.

Purchasing power has increased more during this period than at any time since 2007. It is estimated that purchasing power, what people can buy with their wages, is now increasing faster in Iceland than in any other European country.

Unemployment continues to decrease and is now around 4%, while the average unemployment rate in the euro area has reached new heights at 12%.

The number of tourists increased by 34% in the first 4 months of the year compared to the same period last year. The new government decided to abandon the previous government's plans to increase taxes on tourism. The plans were deemed premature as they would reduce the industry's growth and cut revenues for those selling goods and services to tourists, thereby reducing state revenue. Foreign currency revenues from tourism have become greater than those from the fishing industry.

Investment has increased, especially among small and medium-sized enterprises. The construction industry, which has been through significant difficulties, is recovering. According to a summary by Viðskiptablaðið, known projects, just in the field of hotel construction in Reykjavik over the next three years, amount to about 45 billion krónur.

Increased welfare

Equality has increased despite rapid economic growth. It appears Iceland will maintain its position as the European country with the lowest proportion of the population below the poverty line or at risk of social isolation. According to the latest measurement, the proportion was 12.7% in Iceland while the average in the EU was 25%. Regarding equitable income distribution measured by the Gini coefficient, Iceland ranked third in 2013, mainly due to the relative reduction of the highest incomes, and now it seems that we can strengthen our position by increasing lower and middle incomes.

Child benefits increased from 7.5 billion to 10.2 billion krónur year-on-year. That's a one-third increase.

Income tax decreased by 5 billion, mostly for middle-income earners.

Contributions to welfare have been significantly increased. Cuts in payments to the disabled and the elderly, which were introduced in 2009, were abolished and contributions to social security increased by 9 billion or 11%. Icelandic authorities have never allocated as much funding to social affairs as in 2014.

Contributions to healthcare were increased by 6.8 billion in real terms and urgent improvements were made to the building and equipment of Landspítalinn. This was not done through increased borrowing but by saving elsewhere in the state system, especially in ministries. The preparation for the construction of the national hospital and the strengthening of healthcare services across the country is underway. The project