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Last Updated: Monday, 18 September 2006, 13:58 GMT 14:58 UK
Analysis: Sweden changes direction
By Thomas Buch-Andersen
BBC News, Malmo, Sweden

Fredrik Reinfeldt
Mr Reinfeldt has promised to reform the tax and benefits system
In any other democratic country, a narrow win would be a demonstration of division.

Victory for Fredrik Reinfeldt's conservative Alliance for Sweden constitutes nothing less than a political revolution.

"Sweden has finally become a real democracy," said a senior member of Mr Reinfeldt's New Moderates.

"In real democracies governments change from time to time. That is what is happening here," he said.

The Alliance beat the Social Democrats, who have held power in all but nine years since 1932.

'Working-free class'

So why are the citizens of one of the world's best welfare societies so desperate for change? Because at least 6% of the workforce are unemployed - although the conservatives give a much higher figure - and are living off generous social benefits.

With many Swedes taking sick leave and enrolled in government-run training schemes, analysts are talking about the "working-free class".

Mr Reinfeldt is promising to reform the tax and benefits system so that taking a job will always be a better deal than receiving social benefits or government training.

Celebrations as Fredrik Reinfeldt wins the Swedish elections
Mr Reinfeldt took charge of the Moderate party in 2003
Mr Reinfeldt, who takes office 6 October, will also make it easier for companies to hire and fire people.

He says the move will have a significant impact in reducing youth unemployment, which is among the highest rates in Europe.

"We are the party of working people," Mr Reinfeldt told voters throughout the election campaign.

He wants to trim the Swedish economy so that it will make the best of the global market. And he has the support of big, as well as small, businesses.

Birth of New Moderates

The 41-year-old has three children. His wife, Filippa, is mayor of Taby, the Stockholm suburb where they live.

New Swedish parliament - graphic
Since becoming leader in 2003 he has transformed the Moderates. Dubbed the "Swedish David Cameron", he has taken the party from the right wing to a more popular centre-right position.

And in an echo of UK Prime Minister Tony Blair's New Labour, he has broadened its appeal and renamed the party New Moderates. He has also forged an alliance with the three other conservative parties in parliament.

Others nickname him "the soap" - they say he changes shape when pressed and loves it when things are clean and tidy.

As proof of the level of trust in Mr Reinfeldt's new way forward for Sweden, not even the so-called "spy scandal" could rock the conservative Alliance boat.

Only two weeks before election day, it was revealed that a senior member of the Folk Liberal Party - part of the Alliance - had hacked into the computers of the Social Democrats, thus giving the Alliance access to campaigning schedules and strategies.

Prime Minister Goran Persson
Mr Persson said he would "give way for a new generation"
Although Sweden is a member of the European Union, the country has traditionally held a neutral position in foreign affairs and Sweden is not a member of Nato.

Sweden currently has about 1,000 military personnel serving abroad on international peace missions.

The neutral position is unlikely to change with Mr Reinfeldt's government, although some analysts believe that his Sweden is likely to play a stronger role in shaping the EU.

Outgoing Prime Minister Goran Persson, who held power for more than 10 years, says he will stand down as the Social Democrats' leader next March.

"It is time to give way for a new generation," he said.

However, the Social Democrat party is still the largest in the Swedish parliament, Riksdag, and shows what Fredrik Reinfeldt is up against.

Swedes might be desperate for change but Mr Reinfeldt will have to walk a very fine line between renewing the welfare system and keeping the sense of a state supporting its citizens.

He will be closely watched. In a country where the Social Democrats are the natural party of government, the conservative revolution could be over before it has begun.

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