Iceland State Overview

Iceland State Overview

Political and administrative order

With the Act of Union of 30 November 1918, Iceland became a sovereign and independent kingdom, with its own flag, united to Denmark by the Act itself and by having the same king; but the Icelandic government is separate and normally consists of three ministers. Denmark also deals with Iceland’s foreign affairs. However, after December 31, 1940 the parliament of one of the two countries will be able to request a revision of the Union Treaty and if the negotiations do not produce a new treaty within three years, one of the two parliaments will be able to denounce, in 1943, the current treaty. But for the repeal of the treaty to be valid, it would have to be approved by two thirds of the members of parliament and, in a subsequent referendum, by three quarters of the electoral body. An advisory committee made up of three members of the Danish parliament and three members of the Icelandic parliament meets once a year to discuss issues of common interest. Danish and Icelandic subjects mutually enjoy equal rights in both countries.

The present constitution of Iceland dates from May 18, 1920. The parliament (Althingi or Althing) consists of an upper house and a lower house: in all, 42 members. Of these, 32 are elected in single-member constituencies, by simple majority, for a period of 4 years; 4 are elected by the capital, Reykjavik, with the system of proportional representation, and 6 are elected, also with proportional representation, by the entire electoral body of the country for a period of 8 years. The upper house is made up of 6 members elected by all the electors and 8 members that Althingi elects from among its members: in all 14 members. The lower house consists of 28 members. All men and women who have reached the age of 25 are voters and eligible.

Iceland, administratively and fiscally, is divided into 16 departments, governed by a s ý sluman who fulfills the duties of deputy interpreter, police chief and tax collector at the same time, and in 8 cities which are governed by a podestà (bæjarfógeti), who has the same powers. An appeal can be made from the first instance court to the Reykjavik Supreme Court, which is made up of three judges who choose a president from among them.

Apart from cities, Iceland is divided into 23 municipal districts (some of the administrative districts are divided into two municipalities), governed by a municipal commission under the presidency of a s ý sluman. Each s ý sla is divided into several municipalities (hreppar), which amount to 203 throughout the country. The eight cities, municipalities and districts are ordered municipally; most cities are ruled by a burgomaster (bæjarstjóri) elected by the people.


The constitution considers the Lutheran Evangelical, to which the great majority of the population belongs, the religion of the state (which contributes to the expenses of the cult): in the 1920s there were only 463 dissidents. These are mostly Catholics, who depend on the apostolic vicariate (prefecture from 1923 to 1929) of Reykjavik. The constitution ensures religious freedom.

Public education

Education is very accurate: all children between 10 and 14 have the obligation to go to school; the Icelanders have a great passion for reading and there is no illiterate among them. In several places there are also itinerant masters. The number of elementary schools in 1928 was 238 with 400 teachers and 8,709 pupils, there are also 3 technical schools, among which that of Akureyri has the right to issue the certificate of maturity like the Reykjavik gymnasium. Among the special schools we must remember a master’s school, a school for mechanics, two agricultural schools, two institutes for midwives, two commercial schools, etc. Higher education is given at the Icelandic University of Reykjavik founded in 1911, with four faculties: theology, medicine, law, philosophy. It should also be remembered that in Reykjavik there is the National Library (130,000 volumes and 8000 manuscripts) and that Iceland has a national archive and museum, a natural history collection, and a museum that contains the complete works of the sculptor Einar Jónsson. The main cultural associations are: the Icelandic Literary Association, the Archaeological Union, the Natural History Association, the History Association, etc.


Budgets and public debt. – More than 50% of Iceland’s budget revenue derives from customs duties and the rest from taxes, fees, profits of state-owned enterprises, state-owned income, etc. The main expenses are those for communications, for commerce, for worship and public education, for the administration of justice and for the service of public debt.

From 1928 to 1930, income consistently exceeded expenses, as can be seen from the following table in thousands of L. st. (1 L. st. = 22.15 krónur).

Iceland’s public debt, contracted in part to provide for telegraph lines and other important public works, in part to meet the extraordinary expenses for the purchase of ships and goods during the world war, and above all to help the banks and mortgages, at 31 December 1931 amounted to 39.3 million krónur, of which 36.3 million of external debt (mainly with Denmark and Great Britain) and 3 of internal debt.

Money and credit. – The monetary unit is the króna, divided into 100 aurar, whose ratio with the pound sterling, previously set at 18, was brought in October 1925 to 22.15.

The issuance of tickets is entrusted exclusively to the National Bank (Landsbankinn) which belongs to the state and who is required to hold a gold reserve equal to 3 / 8 of the circulation and convert business on demand in gold coin (Iceland however, it does not have its own gold currency and Danish coins are legal tender there). In 1930 two other banks were founded: one for agricultural credit (Bunadarbanki Islands) and one to subsidize the fishing industry (Utvegsbanki Islands); the first is a state bank, the second a private credit institution, the majority of whose shares are owned by the government.

Iceland State Overview