Public sector net lending in Sweden, the euro area and the United States Per cent of GDP 4  4  2  2  0  0  -2  -2  -4  -4  -6  -6  -8  -8  -10  -10  UK Euro area  -12  -12  USA Sweden  -14  -14 99  00  01  02  03  04  05  06  07  08  09  10  11  Source: IMF WEO, October 2012. It is important in this context to remember that the primary aim of the fiscal-policy framework that we have in Sweden is to make public finances sustainable in the long term. Prior to the financial crisis, the greatest threat to the long-term sustainability of public finances appeared to be an ageing population.7 An ageing population increases the demands on the public sector at the same time as the extent to which the sector can be funded by taxes on employment income decreases. However, the experience gained in countries where the need to rescue systemicallyimportant banks has exerted great pressure on public finances has given us a somewhat different perspective. In a country like Sweden, which has a large banking system in relation to the size of the economy, a banking crisis could quickly have a devastating effect on public finances. Given this, the risk of a financial crisis is therefore perhaps the greatest potential risk to the long-term sustainability of public finances.
Employment developments were also influenced by substantial labour inflows from central Europe following EU enlargement in 2004. Strong growth in labour productivity is not due to any substantial increase in the real capital behind each hour worked, but is related to a considerably more efficient utilisation of labour and capital. In addition, growth in labour productivity reflected a marked fall in sickness absence in 2004. The national accounts show more moderate productivity growth in recent quarters. However, since the figures are provisional and can often be revised considerably, we should be cautious about reaching any conclusions. The strong rate of growth has only to a limited extent fed through to a higher rise in prices for consumer goods and services. The rise in prices has none the less accelerated in recent months. In August, the year-on-year rise in the CPI-ATE was 1.8 per cent. Underlying inflation has long been projected to be between 1½ and 2 per cent in the second half of this year. The year-on-year rise in the total consumer price index (CPI) has been just under ½ per cent in recent months. This is because electricity prices have been substantially lower this year than in 2006, when unusually high electricity prices due to low precipitation levels pushed up the year-on-year rise in the CPI close to the inflation target. In recent months, electricity prices have been at their lowest level since 2002.