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Prime Minister Juha Sipilä (centre) was flanked by Minister of European Affairs Sampo Terho (left) and Minister of Finance Petteri Orpo (right) as he unveiled his government’s last budget in a news conference at the Government Palace in Helsinki on 29 August 2018. (Credit: Jussi Nukari – Lehtikuva)
Prime Minister Juha Sipilä (centre) was flanked by Minister of European Affairs Sampo Terho (left) and Minister of Finance Petteri Orpo (right) as he unveiled his government’s last budget in a news conference at the Government Palace in Helsinki on 29 August 2018. (Credit: Jussi Nukari – Lehtikuva)

 

The Finnish government unveiled its 55.3-billion-euro budget proposal for next year at the Government Palace in Helsinki on Wednesday, 29 August.

Prime Minister Juha Sipilä (Centre) highlighted in a press conference that the government is poised to meet virtually all of its economic policy objectives, with the employment rate set to climb to 72 per cent and the budget deficit set to be wiped out in 2019.

“I have a slightly surprising piece of news: we’re set to put a stop to living on debt,” he declared according to Helsingin Sanomat.

The government has already reached the objectives of increasing the ranks of the employed by 110,000, preventing an increase in the overall tax burden and putting an end to the increase in debt as a percentage of gross domestic product.

“Our objective has been to make sure that taxes won’t increase for anyone and that labour taxation is relaxed during our term in office – in a way that affects especially low and middle-income earners,” said Petteri Orpo (NCP), the Minister of Finance.

“This is a sensible tax policy and this graph shows that that’s what we’ve done,” he added.

Sipilä, however, only discussed the sustainability deficit in passing, despite his government emphasising throughout its term in office that eliminating the 10-billion-euro deficit is one of its key objectives. The objective is likely to remain elusive unless the government manages to push through its long-discussed social, health care and regional government reform, writes Helsingin Sanomat.

The Finnish government wrapped up its two-day budget session on Wednesday, 29 August. It states in a press release that the budget proposal has been drawn up to promote social justice, alleviate the skills shortage, increase employment, enhance national security and support food production in Finland.

The budget is roughly a half-a-billion euros smaller than last year and shows a deficit of 1.4 billion euros.

The government details in its proposal a number of small appropriations for improving the employment situation and developing the education system in Finland. Helsingin Sanomat points out, however, that the funds earmarked for education and training are low in comparison to the education spending cuts of roughly 900 million euros introduced earlier in the current electoral term.

The measures to address the skills shortage include spending 20 million euros on providing short-term vocational and higher education programmes for unemployed job seekers and spending 10 million euros on facilitating the transition of people of immigrant backgrounds to working life.

Aleksi Teivainen – HT