Former minister says finance ministry has too much power

Former Finance Minister Sigurður Ingi Jóhannsson says the relationship between Landsvirkjun’s board and the Finance Ministry changed inappropriately after a new board took over the state-owned power company. He says frequent board meetings at the ministry, some held without the company’s chief executive knowing, raise serious questions about political interference. The comments were reported by mbl.is.

Sigurður Ingi made the remarks on the mbl.is programme Spursmál, where he and former Landsvirkjun board member Álfheiður Ingadóttir discussed the departure of chief executive Hörður Arnarson and the board’s dealings with Finance Minister Daði Már Kristófersson.

Sigurður Ingi said there had previously been an established practice for contact between Landsvirkjun’s board and the minister responsible for the state’s ownership stake. The company’s chief executive and board chair would meet the finance minister once a year, or twice if circumstances required, and then brief the board on what had been discussed.

He said he had been concerned when the government changed how boards of state-owned companies were appointed. Previously, the governing and opposition parliamentary groups nominated board members. Under the new system, the finance minister appoints all members following proposals from a selection committee.

Sigurður Ingi said he had raised concerns with the prime minister and finance minister in spring 2025, including that the change weakened Parliament’s democratic link to the boards and gave the finance minister too much influence. He now believes developments have vindicated those concerns, questioning why the board meets so often at the ministry when it is meant to run the company independently of politics.

Álfheiður, who served on Landsvirkjun’s board for a total of 14 years, agreed with his criticism. She said the board’s dealings with the ministry had previously followed set procedures, with only the board chair and chief executive attending meetings with the minister on the company’s behalf. Those meetings were held annually, or when necessary, and the two representatives then reported back to the board.

She said it was unreasonable for board members to repeatedly meet at the ministry to discuss matters that belonged within the company.