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In government 1993–2001 The Social Democrats' social policy through the 1990s and continuing in the 21st century involved a significant redistribution of income and the maintenance of a large state apparatus with collectively financed core services such as healthcare, education and infrastructure. Social Democrat-led coalition governments (the Cabinets of Poul Nyrup Rasmussen I, II, III, IV) implemented the system known as flexicurity (flexibility and social security), mixing strong Scandinavian unemployment benefits with a more lax regulation of employment, making it easier for employers to fire people in order to encourage economic growth and reduce unemployment. It is required for people to continually try to remain an active part of the job force in order to receive benefits if they lose their job. This plan has proven to be successful at reducing unemployment, and it has been proposed as a plausible model for other European countries such as France. The Cabinets of Poul Nyrup Rasmussen maintained a parliamentary majority during the period from 1993 to 2001 by virtue of their support from the Socialist People's Party and the Red-Green Alliance. Towards the end of the 1990s, a trade surplus of 30 billion kroner (USD 4.9 billion) turned into a deficit. To combat this, the government increased taxes, limiting private consumption. The 1998 initiative, which was dubbed the Whitsun Packet (Danish: Pinsepakken) from the season it was issued, was not universally popular with the electorate, which may have been a factor in the Social Democrats' defeat in the 2001 parliamentary election. In opposition 2001–present After the defeat to the Liberal Party in the 2001 election, the party chairmanship went to former finance and foreign minister Mogens Lykketoft. Following another defeat in the January 2005 election, Lykketoft announced his resignation as party leader, and at an extraordinary congress on 12 March, it was decided that all members of the party would cast votes in an election of a new party leader. The two contenders for the leadership represented the two wings in the party, with Helle Thorning-Schmidt being viewed as centrist and Frank Jensen being viewed as slightly more left-wing. On 12 April 2005 Helle Thorning-Schmidt was elected as the new leader. Leaders of the Socialdemocrats Helle Thorning-Schmidt See also | ||||||||||
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