The government has agreed on the basic criteria for viable municipalities as part of a sweeping consolidation process.

Led by Minister of Public Administration and Local Government Henna Virkkunen, the cabinet on Wednesday reached consensus on the minimum levels for population, demographic structure, municipal finances and so on.

From the standpoint of health and social services, the cabinet says each municipality should have at least 20,000 residents. And for basic education to be sustainable, there should be at least 50 children in each age group.

Each municipality should have a job self-sufficiency rate of at least 80 percent.

If a local authority fails to meet even one of the criteria, it should merge with one or more of its neighbours, the government says. And even those that meet all the benchmark standards may be asked to merge with less-well-off neighbours – and given financial incentives to do so.

The criteria will form the basis for the municipal reform law that is to take effect by next May at the latest.

The government aims to drastically reduce the number of municipalities from the current 336.

The criteria immediately came in for criticism from the Association of Finnish Local and Regional Authorities, which called them "difficult to understand and open to multiple interpretations".