Helene Hanssen
and Mari-Anne Zahl, MSW, Dr.polit.

Norwegian Governmental Policies of Decentralisation and Privatisation and Consequences for Social Work


Decentralisation and privatisation have been dominant issues in the development of health and social policies in Norway during the last 10–20 years. The relationship between the central level and the regional/local level has gone through major changes during this period. The main responsibility for welfare services rests presently at the municipal and county level. From running and controlling the services in detail, the state now sets the external conditions through legislation and regulations to ensure an equal service level for everybody, regardless of where in the country they live. It is mainly a municipal responsibility to bring about governmental policies and goals ( (2000 – 2001)).


This article presents some examples of services that have been decentralised and privatised during this period, either through radical reforms or through more silent evolutions. The services that traditionally have been decentralised, like public assistance, will not be discussed. However, it can be mentioned that there is a persistent discussion also within these areas on how to provide an equal and just national level for services rendered.

Some statistics

Norway is a country with a relatively small population in proportion to the geographical area. It is a mountainous country, with a vast area that is not suitable for settlements. It has four larger cities (population more than 100000) and many smaller towns, villages and municipalities. The statistical figures show (per 31.12.00):


Geographical area: 325000 km2
Total population: 4, 478, 497
Number of municipalities: 435


Urban municipalities (population more than 100000) : 5
Larger municipalities (population 20000 – 100000) : 38
Medium municipalities (population 5000 – 20000) : 147
Small municipalities (population 1000 – 5000) : 224
Extremely small municipalities (population less than 1.000): 21
(Statistisk Sentralbyrå 2001)


The ideology of supporting autonomous local government is prevalent in Norwegian democracy. The above mentioned figures are therefore of importance when focusing on decentralisation and privatisation of social services in Norway, especially the fact that as many as 245 municipalities have less than 5000 inhabitants, and out of these, 21 have less than 1000 inhabitants. This means that many of the sovereign political and administrative units are small and serve few people.

Traits in the decentralisation of health and social services
Historically, as many other countries, Norway has organised the services for people with special needs in rather centralized units and the legislation and regulation of the services were authorised by a number of special laws (Seip 1984).


Since the early 1980s the development of health and social policy and the delivery of services within these areas have moved in a clear direction. In short these can be listed as follows, from:


• institutionalisation to integration in society at large
• central institutions to locally-based services
• care in institutions to home-based care
• special laws/legal rights to general rights/legislation
• governmental responsibility and control to legal regulation and municipal autonomy
• client to user to citizen – focus on user’s involvement, individual plans and service (NOU 2001: 22).

This illustrates that the decentralisation of health and social services in Norway implies:

1. That the specialized services are offered on a municipal (or county) level rather than at the state level (from state to municipal level)
2. That even at the municipal level the services are offered on an outpatient rather than on an institutional level (from institutional to “private” level)
3. The rights of people with special needs are included in the general legislation for health and social services rather than being authorised by special laws (from legislative segregation to integration)
4. Decentralisation is closely related to the discussion on user’s rights and democratisation in the health and social services

The transformation of responsibility from the central to the local level was followed by economic transferences. The municipalities receive funding from the state to develop services at the local level. In the early stages of the process, funding was earmarked for specific areas only. Subsequently, funding has most often been given as block grants. The municipality itself has the responsibility to use this in a way that keeps the services at a sufficient level. One major criticism of this policy is that the transference of money from the state was relatively high in the initial phase, but then reduced. The cut creates problems in running and developing the services further. On the other hand, the municipalities are being criticized for using the funding for other tasks given high priority in the municipality.


The decentralisation of services leads to the necessity of comprehensive thinking, crossing sector lines, agencies and political properties. For instance, there is a need for close connection between the housing policy and the care policy, between the educational system and the social services, and between the mental health care and the employment office ( 35 (1994-95)).


Decentralisation of health and social services in Norway are based on social democratic ideology and values. Equal rights for all people, regardless of personal ability, background or living conditions, as stated in the UN Declaration on Human Rights (1948) and the UN Convention on the Rights of the Child (1982), are the major goals.

Vital objectives for decentralisation of services can be outlined as follows:
• include every human being in ordinary society and its systems
• reduce the stigmatisation related to different problem groups
• understand and find solutions to difficulties in accordance with to people’s natural contexts
• design the services for each client according to individual needs and local resources
• facilitate an access to service – make the services more user-friendly (NOU 2001: 22).

Decentralisation as a strategy – examples from relevant areas
Decentralisation as a strategy in health and social policy affects most areas of social work. To illustrate the changes brought about by this strategy and paint a picture of the challenges for professionals and local communities, examples will be given from two relevant areas: Care for Mentally Disabled and Mental Health Care.

The Care for Mentally Disabled

Historically, the disabled have mainly been cared for in rather big central institutions by Norwegian standards. In 1969, there were 109 such institutions with a total of 5500 beds. Some families chose to keep their disabled children and adults at home, but there were practically no services offered to neither the children nor the families. Generally speaking, the public care for intellectually disabled was institutionally based (NOU 2001: 22).


In the 1970s a very critical debate was raised about care and protection in these institutions. Cases of rather severe neglect and abuse were exposed. The human rights of the intellectually disabled were put on the agenda. In 1982, a public committee (Lossius-utvalget) was appointed to explore conditions in institutions. The committee concluded that the living conditions in institutions were inhuman and not acceptable to modern society and proposed that the institutions should be closed (NOU 2001: 22).


In short, this led to a total reform in the care for mentally disabled implemented 1 January 1991. A nationwide registration of disabled (those who lived in institutions as well as those who lived with their families) and their needs was accomplished. The institutions were supposed to close down by 31 December 1995 at the latest, and each municipality was obliged to provide suitable housing and care for their disabled. The disabled children were to be integrated in ordinary classrooms in the schools and kindergartens. The disabled adults were supposed to be integrated in the ordinary neighbourhoods and social systems (NOU 2001: 22).


Consequently, during a period of 5 years, 5100 individuals were sheduled to move from the central institutions to their municipality of origin. Most of them needed some kind of sheltered accommodation, care, practical assistance, occupational therapy, transport, etc. In addition to the ones who lived in institutions, the registration showed that 8000 disabled lived with their families. About 4000 of these were adults. The reform was supposed to also include them, but highest priority was given to the ones who lived in institutions. The local communities were faced with extensive challenges.


The reform has been under constant evaluation administrated by the Norwegian Council of Research. We will draw attention to the fact that a minority of the next of kin were positive to the reform in advance; though in 1996, in retrospect, 75% considered that the reform had led to a positive change for their disabled family member. Regarding the housing conditions, the evaluation studies show that one year after the institutions were closed down, 96% of the people who had moved out lived in some kind of shared housing, care homes, etc. while only 6% lived in their own separate flat (Tøssebro 1996).


Today, it is common for the disabled to live with their families until the age of 16–20 and then move into some kind of care accommodation. Yet, it is a fact that the waiting lists for such housing are rather long. The local communities have still not fully managed to build services according to needs and expectations of the public.


It is further initiated that the Department of Social Services is responsible for composing individually-based core groups and work out personal plans for habilitation to promote users involvement, and to secure a sufficient level of service to achieve individual goals. (St.meld. nr. 21 (1998–1999)). Some municipalities have already started this process and to a certain degree this work is forcing an inter-agency coordination. However, there is still a long way to go to formulate these plans and not least to put them into effect.

The Mental Health Care

The Mental Health Care Reform was initiated in 1996 (St.meld. nr. 25 (1996-1997)) and implemented in 1997. This reform has been stated as the most extensive and important change within the health and social sector in Norway (St.prop. nr. 63 (1997-98)).


Historically, institutionalisation was the main solution to mental illness. The care and therapy for people with severe and/or chronic psychological dysfunctions were organised in rather large centralised hospitals. One of the primary goals in this reform is to integrate people with psychological dysfunctions in the local communities. This involves that centralised hospitals will gradually be closed and every municipality has the responsibility to offer sufficient outpatient therapy and care, even to people with severe and chronic dysfunctions, and also to provide suitable living conditions in general, such as care accommodation, education, work or occupational therapy, etc. Hospitalisation is to be used only in very severe, life threatening and acute situations and, in principle, only for shorter periods. This has led to a decrease in number of hospital beds and the mushrooming of outpatient services (Robberstad 2002).


During the period 1994–2000, 18387 care homes were built in Norway (NOU 2001: 22). This includes care homes for people with different kind of problems. The numbers illustrate that the decentralisation of services has a great influence on the local communities and affect a large number of people. In the period 1999–2006, 3400 care homes are to be built mainly for people with psychological dysfunctions. Institutionalisation as a way of living shall be brought to an end (Plan of Action for the Mental Health Care 1999–2006). Looking critically at the plan it might be asked whether the reform brings institutionalisation to an end – or if care homes represent the institutions of today.


Yet, decentralisation of this type of care does not only include housing. It also comprises providing a wide spectre of services needed to create a good quality of life. Last, but not least, it deals with changing attitudes in society at large and our thinking as professionals. According to preliminary research, the differences between municipalities in providing general and specialised services are major, and there is still a long way to go to fill the gap between ideals and reality (NOU 2001: 22).


Traits in privatisation

Privatisation is not a new idea. For the time being, 40% of day-care facilities in Norway are run by private parties. Even so, the discussions of privatisation of social services have triggered heated discussions. In the Norwegian political system we find attitudes along a socialistic – conservative axis. The Socialists have public control as their aim, whereas the conservatives are aiming at reducing public control. However, they will not escape governmental control-mechanisms such as subsidies and by law-making setting limits.


Since we are using a terminology that appears in everyday language as well as in research and in the social services, we will give our understanding of some of the important concepts:

• Privatisation indicates that the public hands over the responsibilities for a certain task, or area to private enterprises or private organisations (privatisering)
• Outsourcing includes letting others do the work while the public plans, covers the expenses and keeps the main responsibilities. At this level, negotiations as well as competition might enter the scene (utsetting av driftsoppgaver)
• Tender and competitive tendering or bidding cover the expenses. The public can also be a tenderer for the task at stake. Different parties compete to secure a contract for public services (anbuds- og konkuranseutsetting av kommunale tjenester)

We might puzzle over which elements lend themselves to privatization. Areas like responsibilities, market, costs, contracting out, and central- and local governmental administration fall into this category (Lorentzen 1987). This indicates that when we start discussing privatization, a whole range of political and ideological issues are at stake. These matters touch upon fundamental convictions. Promoting the scheme that privatization will harm the welfare state will irritate some; promoting the opposite, saying privatization will make the welfare state more effective, will aggravate others. Exploring this phenomenon from a rather value free stand seems complicated. Over time, political parties have worked for moving from private to public. At this point it seems as though politics are reversing. However, during the period of public dominance laws prescribing public responsibilities are adopted. They provide guidelines for potential “reversing processes” or obstacles for such a move.


For both profit and no-profit organizations, private represents supplements and alternatives to what the public offers. The profit dimension is a central concern in the discussion about privatization of care functions. Privatization in the sense of leaving all responsibilities to cover the needs of citizens in an area – for example child care – to private enterprise, has not been the way chosen in Norway. Private competition might come along with public alternatives. Discussions regarding public–private include covering costs. In Norway, ‘private’ does not mean no public funding by subsidy. Approved private schools receive from 85 to 100% funding from the government. Another trend is to let users pay part of the cost directly, to reduce expenses for the public. Converting technical entities into companies/corporations is also a trend. This might be part of providing an opportunity for these establishments to compete with tendering by private firms.

The idea of reducing costs – cost effectiveness – is prevalent in the reasoning leading to competition and tendering. Estimating cost is a complicated matter with many hidden factors. This covers for example, time to prepare the tendering, to keep control of quality of work done and decide on qualifications to be required from the workers. Are some professionals to be replaced by paraprofessionals or by others for on-the-job training? Does a person with three years of education serve clients better than one with five years or only one year of training? Will education be part of the cost-effectiveness calculation? Education might be considered of value to society at large even if it cannot be proven effective in all settings.


In the health sector, some services are provided by private enterprise. However, a newer reform follows the principle of every person having a "primary" doctor. We might call it an updated form of family doctor. We were all asked to suggest the doctor we wanted and ended on her/his list. The doctor receives a certain amount of money from the public for each name on the list. Due to the system of socialized medicine, taxes are paid for potential services, and a set fee is paid when using the services. This amount has a fixed upper limit for each year.

Examples of privatisation

When planning for cutting costs, finding good comparisons is essential. Using the same tools in Norway as in Sweden, for example, does not automatically lead to the same results. Since institutions in Sweden in general had a higher employee rate than in Norway (Bogen & Nyen 1998), reducing costs by cutting staff can be better tolerated in one system than in another. The same goes for seemingly similar institutions.


When some municipalities wanted to “lease out” care for the elderly to an international company, voices were heard. The municipality of Asker – close to Oslo – negotiated a five-year contract from 1996 with an international company, ISS, and with no competition from other companies, whereas Moss – also a municipality in the Oslo vicinity – in 1997 signed a four-year contract with the international company, Partena Care, to run a nursing home. This move is said to be ideologically based and not as a result of sound considerations (Nesheim & Vathne 2001: viii). The contract came about in competition with another company (Eikås 2001). The offer from Partena Care was 2.1 million Norwegian kroner below what the municipality had estimated. The calculations showed to be too low and after adjustments came quite close to the other figure (NOU 2000: 19, 91). This is an example that illustrates forth the question of who is to take responsibility for services when crises arrive. Since then, Oslo and Trondheim have opened up for private companies in the care for the elderly. Prior to this, renovation and cleaning had been handled by other companies – including the cleaning for institutions for the elderly.


In order to prepare for tendering or negotiations, the municipality has to set standards. They have to specify what services they intend to buy. In fact this includes everything that is supposed to take place in, for example, a nursing-home, such as food, care, medical treatment, activities, hygiene, staff ratio, and reports. This is a document that will be used when evaluation is to take place. Written documents of this kind open up for comparisons between municipalities, and also set a standard for requirements used in the nursing homes run by the municipalities themselves. The planning work sets new tasks for the public servants and these take time to learn. However, their new skills will be valid if the privatisation and outsourcing waves continuous or if they come to a stop. Paying for this training, however, might be part of the cost-effectiveness calculations.


We can give an example from the city of Kristiansand, where a set of criteria was used when evaluating if a service could be part of tendering (Nesheim & Vathne 2001: 54-55). This applies to all their municipal services:

• no legal hinder
• the services must have a certain financial importance and potentials for cutting cost
• start with rather simple surveyable/well organized services to boost possibilities of success
• the service must lend itself to specification
• the service must lend itself to precise description
• there must be real competition between service providers (suppliers)

On the other hand, a few ”ifs” to be aware of are mentioned, including:

• if the service has important effects for the municipal organization, it should not be exposed to tendering
• if the service can develop and be offered on the private market this might initiate growth and new products that results in good contract agreements for the municipality
• if the municipality operates in a competing market it is important to master tendering techniques, contract control, and the writing of agreements.

Quality of services has been a central issue in discussing giving room for private and commercial organizations in services for the elderly and for children. This opens up for a debate of how to define quality for people served, and make quality concrete enough to be observed, evaluated and corrected or if below the standard in line with the specifications mentioned above.


A drawback is, however, if the municipalities cut down special services and terminate positions for professionals needed to run certain programs. Municipalities might become unable to undertake the tasks themselves if they turn out to be dissatisfied with the quality of work purchased from companies. They will be disqualifying themselves. Companies on the other hand, can raise the prices if they have few to compete against. Such a situation is more likely to come about if negotiations with a chosen party have been used instead of competition. These processes might open a path leading from public monopoly to private monopoly.


Research focussing on attitudes indicates that citizens have become more sceptical towards public services and less sceptical towards private solutions. Research also indicates that those receiving public services are more satisfied than the general public. What seems to be most criticised is the lack of available services leading to long waiting lists (Moland & Bogen 2001: 11).


The Norwegian welfare state has financed most services through taxation. Wage earners pay high taxes on a progressive scale. This means direct payment for social services are rare. Most social workers work for public offices and institutions. More than 50% of them work for the social welfare department. Some are selling their services to the public, for example, by running child care facilities. It is a new challenge for social workers to offer their services on an open market and not be closely tied to social policies.

Challenges for social work

One of the main tasks for social services and social workers in the Norwegian welfare state is to implement governmental social policies. The national goals related to decentralisation (and privatisation) processes and the expectations to services offered will effect social work in all its contexts: social work practice, social work research, social work education and the organisation of social services. We will discuss some of the challenges arising from this.


As initially illustrated, Norway is a country with many small municipalities, 245 in rural areas with less than 5000 inhabitants. Each municipality is an autonomous administrative and political unit, with its own health and social services. Firstly, it is a problem for a number of these municipalities to recruit professional and experienced health and social workers. Secondly, they have a problem in encouraging the professionals to stay. Professionals often consider these jobs as temporary, jobs were new graduates can gain experience to get positions in more attractive areas, both professionally and geographically. Thirdly, the possibility to maintain and further develop specialized competence is often quite limited, mainly because of the very limited professional/specialist environment, a small number of cases, and the necessity to function as a generalist. So, if we consider decentralisation as a transfer of specialized services from the central to the local level, it represents a challenge to the quality of services provided. One way of dealing with this has been to concentrate on formalized inter-municipal coordination, and inter-agency and inter-professional collaboration. These are actions which, in turn, challenge the professional roles and the organisation of services.

Integration – inclusion – exclusion

The idea that a society is able to include all citizens is outstanding. Few would disagree with this as a principle. The important issue is how to make it happen. Several questions can be asked according to the present policy of integration:

• What does “integrating people with disabilities and special needs” mean? Is there any significance between “non-segregation” and “inclusion”?
• Does building care homes for people with psychological dysfunctions lead to inclusion of them on an individual level into the neighbourhoods?
• Does the fact that an disabled pupil attends a regular class at school imply that she is looked upon as an equal and finds friends among her schoolmates?

Based upon research and experience, our answer to these questions is, "no" (Tøssebro 1999). Placing people together physically can in the long run create some changes in attitudes towards one another, but the process is slow, the costs are high and the results are uncertain. This is also intensified by a certain duality in values in western societies: on the one hand, the statement of equal rights and value of every citizen; and on the other hand a society where youth, beauty, effectiveness and success are outstanding ideals, and intellectual and physical ability is more and more valued in the school systems, labour market, etc. As a term, integration focuses on the individual to fit into the established social systems, while inclusion focuses on changing the social systems to fit the variety of individuals (Oliver 1996, Skrtic 1991). Integration might lead to exclusion and loneliness for the people who are “integrated”. They are looked upon as “different” and do not have access to the more informal socializing. Some might even feel more excluded than before, because compared to “institutional life” they have less opportunity for contact with people who share their own characteristics.


Traditionally, social workers in Norway have neither been very visible within the school system and nor in the care for disabled. The majority of professionals within these areas have been, and still are, teachers and social educators. Even if the need for inter-professional competence is clearly stated, the decentralisation of services has only to a very small extent lead to an increase in the number of social workers within these areas.


In the hospitals for people with psychological dysfunctions, social work traditionally has had a rather strong position. However, the transfer from institutions to a municipally-based outpatient service has led to an increasing number of psychiatric nurses in the municipal mental health care system and very few social workers.


We might question whether the absence of social workers within these services also implies that the priority is on learning (or teaching) in the schools, health (in a narrow sense) in the municipal health care and practical assistance to the disabled, and that the social consequences, such as loneliness and exclusion, social functioning, have been less in focus. Even if we consider social work to represent important perspectives, values, understandings and methods, it is a great challenge to promote the professional competence as an indispensable contribution in all service areas, and to enter new arenas as well.


Unfortunately, entering a new arena also brings up conflict of interests between different professions. Professions that have had a dominant position within a specific area will not easily open up “their domain” for other professions, even if the tasks have changed and new competence is needed. It seems to be a general challenge for professionals to concentrate on the client’s needs rather than their own interests as professionals and to use their competence in an inter-professional context (Barr 2002).

Social work education and practice

Finally, we want to raise the question of whether we need a change in social work education and practice to face the challenges following from decentralisation, and also to link this to the organisation of services and privatisation.


The expectations of social services today are rising, as the general public are increasingly better informed of their rights as users of public services and general levels of trust in professionals are eroding (Nolan, Davies & Grant 2001). Studies on users, involvement in the delivery of social care services show that there is a gap between how social workers themselves consider service is given and their cooperation with users, and how the users report servicis received and their own influence in the decision making (Sandbæk 2000, Croft & Beresford 2002)

Even though social work was founded on democratic ideals and respect for every human being, this is not the way clients feel professionals meet them, generally speaking. This might relate to the possibility of social workers being forced into certain roles by inhuman organisations and procedures; or maybe they have too much work to do; or maybe clients misunderstand?


Perhaps social work practice, as a part of the public services, does not have to make an effort to serve people? Maybe social work education focuses too much on client problems based on professional assumptions and roles, and too little on clients’ resources and capability. Maybe the education programmes creates paternal (or maternal) social workers, who perform as experts on problems rather than as experts to guide, assist and support people in finding their own solutions. A person’s desires and requests does not necessarily coincide with their needs as defined by outsiders.


Decentralisation and democratisation of services implies the reconsideration of social work education as well as social work practice and the organisation of services. Inter-professional and inter-agency cooperation are acknowledged as important measures, but in the “real life” this often means a lot of meetings with rather poor results. In Norway, the health and social services have more or less been under constant reorganisation for the last 10–15 years, with many projects to develop new “inter-professional” and “cross-agency” organisations of services, but it seems to be very difficult to break down the boundaries between the specialised services, and we have still not found any good answers. The users still experience that the communication between services is insufficient and that they have to muddle through the service jungle.


The new objectives for rehabilitation services challenge the service jungle by stating that the individual user’s needs should be in focus for inter-agency collaboration, rather than the agencies need for organising, and are also establishing the user himself as an important and authoritative partner in this collaboration. This implies a maximum of flexibility, where collaboration groups are to be formed from case to case, rather than a fixed forum for communication and collaboration (NOU 2001: 22). It will be of interest to follow how these ideas can be realized, since they challenge professional roles and the relationship between professionals and clients as well as inter-professional relationships.

Reflections about decentralisation and privatisation

The Norwegian Welfare State is ideologically based on equality for all citizens regarding rights to, access to and levels of education, health and social services. Decentralisation and privatisation of services challenge this ideal. In spite of the fact that Norway is one of the richest nations in the world with a high standard of living in general, the welfare state is under hard pressure and questions are raised as to whether the country suffers from public poverty.


Decentralisation transfers responsibility from central to local authorities and leads to complicated discussions regarding prioritising public funds where conflict of interests between different political parties and pressure groups are visible. Within the health and social sector we can observe a tendency to reduce non-statutory provided services, like most of the social services, in favour of statutory-provisioned service such as essential health services.


Quality of services is central when discussing both decentralisation and privatisation of health and social services, including access to and standard of services, and also the consequences for developing professional competency. On the one hand, privatisation has many faces. It might drain the public sector of competence and quality services as well as lead to a friendly and service-minded public sector, providing quality products in competition with private service providers and become excellent overseers of private supply. On the other hand, privatisation of services might impoverish the public sector and make it dependent on commercial firms. This development might harm less privileged groups.


Any change in social policy influences some group of citizens somehow – social workers included. Social work is in interaction with society at large and therefore, social workers have a role to play on behalf of clients when major changes are taking place. Social workers are expected to render quality services to clients regardless of structural arrangements and to develop practice knowledge continuously. We might ask if there is evidence that services provided by the public sector are superior to services provided by private enterprises. Do public services reach target groups better and cheaper than private parties? Or, might privatisation be one of the answers to promote democratisation in decentralised services? Questions of this kind will be posed as part of the agenda when evaluating and developing social services in a changing society. On such an occasion social work might again discuss what it has to offer and the future developments to promote problem reduction and social functioning.



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