Reykjavík mayor calls €62.2bn disability services deficit unacceptable

Reykjavík Mayor Hildur Björnsdóttir has called the city’s accumulated deficit in services for disabled people “completely unacceptable”, mbl.is reports, saying the state must provide additional funding.

Speaking to Morgunblaðið in response to a significant overspend in Reykjavík’s welfare department, Björnsdóttir said municipalities had accumulated a deficit of 62.2 billion since taking responsibility for the service area in 2011.

“This is, of course, a completely unacceptable situation that threatens the financial sustainability of municipalities, and the state needs to correct it,” she said. “It is unacceptable to transfer such sensitive responsibilities to municipalities without providing the necessary funding.”

Björnsdóttir also criticised a March 2025 agreement under which the state was to take over services for children with complex needs. She said the state had significantly scaled back its involvement, leaving Reykjavík with costs of nearly one billion that the agreement had assigned to the state.

She said the city also needed to address its own operations. Reykjavík recently began organisational changes in the welfare department aimed at improving its structure and achieving operational savings.

Employee sickness absence was another concern, Björnsdóttir said. Illness among city employees has cost the city treasury between six and seven billion annually in recent years.

A report from the city’s professional departments presented to the city council last Thursday said sickness absence in the part of the welfare department responsible for residential services was 7.3 per cent during the first six months of the year, equivalent to 74 full-time positions. The report said staff illness had significantly affected service operations by increasing the need for replacement workers.