The Danish government has announced a new long-term initiative to reduce state administrative expenses by at least 5.5 billion DKK (approx. €737 million) by 2030. The plan, unveiled by the Ministry of Finance, aims to cut down on what officials describe as “unnecessary administration” and streamline the public sector.
A structural shift in public administration
According to the Ministry of Finance, the objective is not necessarily to cut public sector jobs, but to reallocate resources by reducing bureaucracy. As Finance Minister Nicolai Wammen (Social Democrats, S) stated, “State bureaucracy has grown to a point where intervention is now necessary,” despite recent increases in staffing for police and defence.
Berlingske reports that the amount corresponds to roughly 6,500 full-time positions, but the government emphasises that savings can be achieved through digitalisation, smarter procurement, and more efficient construction and facility management.
Reprioritisation, not austerity
Rather than cutting overall state spending, the plan is designed to allow for reprioritisation. As Wammen explained, “We need to invest heavily in our defence, police, and emergency preparedness. To make room for this, we must identify tasks that can be phased out.”
Each ministry has received specific spending targets. However, larger ministries are expected to contribute more, while the Ministry of Defence, Ministry of Justice, and Ministry of Emergency Management will be exempted, as they are slated for further investment.
Artificial intelligence and smart savings
Part of the savings is expected to come from the integration of artificial intelligence into public administration. The government has announced the creation of a digital task force to implement AI-driven solutions. Minister for Culture Jakob Engel-Schmidt (Moderates, M) noted that “some tasks we solve today may no longer need solving in the future.”
Still, the details on which tasks will be dropped remain unclear. Individual ministries will decide which duties can be deprioritised or discontinued.
Union concerns over lack of clarity
The plan has raised concerns among public sector unions. Djøf, which represents many state employees, welcomed the long-term planning approach but criticised the lack of specificity.
“Setting a savings target without stating which tasks will be cut is insufficient,” said president Sara Vergo.
The Danish Trade Union Confederation (FH) echoed this concern, warning that past cuts—such as those to the Defence and Tax Administrations—have shown the risks of ill-defined savings plans. FH president Morten Skov Christiansen stressed that “citizens deserve clarity on what services will be lost.”
Private sector demands deeper cuts
The announcement was met with approval from business groups, though many called for more ambitious reforms. The Danish Chamber of Commerce had previously proposed cutting 20,000 public sector positions, equating to savings of around 10 billion DKK (approx. €1.34 billion).
Brian Mikkelsen, the Chamber’s director, described the plan as “a good start,” while the Confederation of Danish Industry called it “a necessary first step”. The Confederation’s political director, Morten Høyer, emphasised the potential of AI to reduce the number of administrative employees.
While the government maintains that the programme is about better use of resources rather than outright job cuts, the debate around the future of Denmark’s public administration is expected to intensify as the 2030 deadline approaches.
