Denmark will be on a strict diet over the next three years, with possible savings of some DKK 27 billion from 2011 to 2014 if the deficit is to be reduced by half a percent of GDP, according to Finance Minister Claus Hjort Frederiksen (Lib).

Denmark is due to present its EU convergence programme within the next couple of weeks to indicate how the government plans to address the national deficit. Currently expected at 5.5 percent of GDP for 2010, Frederiksen says that an EU Commission requirement that Germany improves its budget by half a percent is also likely to be a requirement for Denmark.

Half a percent would mean DKK 9 billion each year for the next three years, the minister explains.

“When we see what recommendations other countries have been given, we resemble Germany most and we do not expect recommendations under half a percent,” Frederiksen says.

He does not, however, expect savings to result in local council redundancies or a decline in public services.

“There will be less to operate with both for the state and local councils who should expect to have the same funds available next year as this year,” Frederiksen says, adding that taxes will not be increased due to the government’s tax freeze.

“The government has a tax freeze and that is fundamental. But there will be lower growth in the next few years. We have to take care of our money,” Frederiksen says.