Swedish government in crisis after almost all citizens’ personal data is leaked

The Swedish government has replaced two of its ministers as it attempts to avoid falling entirely amid a crisis involving a leak of the data of almost all of the country’s citizens.

The information from the country’s driving licence database was made available to IT contractors in other countries, who had not undergone security clearance checks, as part of an outsourcing deal.

Swedish Prime Minister Stefan Lofven has replaced two of his ministers in an attempt to stop any more dramatic fallout. But the opposition is seeking for the government to fall entirely and for the country to have an early election.

“I have to take responsibility for the country. It wouldn’t serve Sweden to throw the country into a political crisis,” Mr Lofven told a news conference, citing the many challenges Sweden and the European Union were facing, including Brexit.

The opposition Christian Democrats and far-right Swedish Democrats said, however, they would press ahead with a no confidence vote in Defence Minister Peter Hultqvist.

If they win that vote, it could yet bring down Mr Lofven’s minority left-green government and force him to resign or call an early election.

“I will handle that if and when it happens,” Mr Lofven said, referring to the confidence motion, saying the opposition should think hard about going ahead with it.

“It is important for the members of parliament that are going to push the button ... that this is the responsibility they have taken upon themselves.”

The parties’ options are constrained by the fact that the nationalist, anti-immigrant Swedish Democrats have held the balance of power in parliament since 2010. Other parties refuse to work with them, but are unable to form majority governments without them.

The scandal involves the handling of data under a 2015 outsourcing deal between the Swedish Transport Agency and IBM Sweden. Mr Lofven admitted on Monday that his country and its citizens had been exposed to risks by potential leaks of sensitive information.

Among some of the details that could have been accessible outside Sweden were the registration numbers of most vehicles on land, air and sea in Sweden.

Whistleblowers have raised concerns that information about vehicles used by the armed forces and the police may have ended up in the wrong hands. The identities of some security and military personnel could also have been at risk, according to reports.

Magnus Hagevi, professor of political science at Linnaeus University, said the prime minister, in reshuffling his cabinet, had gone for a “middle option” to try and keep his government in place.

“What was unexpected was that Hultqvist remained in his position. That means this is not over in any way, we need to wait and see how the party leaders of the (opposition) Alliance will act,” he told Reuters.

The Swedish krona was unperturbed, trading largely unchanged against the euro after initially strengthening somewhat.

“Financial markets have taken this in their stride, and I think that will continue also going forward,” said Robert Bergqvist, SEB chief economist.

“The combination of a strong Swedish economy, a strong balance sheet, and the economic-political framework gives us protection against these political events. But there could possibly be somewhat more nervousness in the financial markets if problems around the state budget arise, so we need to keep an eye on that.”

Sweden has enjoyed an economic boom most countries in Europe would envy. Gross domestic product grew by 3.2 per cent last year and is predicted to grow by 2.4 per cent this year.

Additional reporting by Reuters