The political leaders are trying to hammer out a framework agreement on the economy in official government formation negotiations. Potential savings can not be identified until the various working groups in different policy areas have reported back, and on Friday politicians did not want to speak publicly about an alleged list of potential spending cuts.
According to Prime Minister-designate Jyrki Katainen, the party chairs will first agree on the financial figures that will underpin the negotiations and a resulting government programme.
The parties are searching for an understanding on issues such as the size of the budget deficit – that is, how much existing spending commitments will cause government expenditure to increase in the coming years, even without any new spending proposals.
It will not be an easy task. Social Democrat chair Jutta Urpilainen said that there were still big challenges in forming a government even after the Portugal aid package was dealt with, but she was happy with the progress of the negotiations.
"The party chairs were able to openly share their thoughts," said Urpilainen. "The chairs have different views on the economy and much else besides."
Left Alliance chair Paavo Arhinmäki agreed that the talks would be difficult.
”Nothing is settled until everything is settled,” said Arhinmäki.
Poor Man's Friend
Despite this, Katainen said that a good spirit prevailed at the talks, and said that expectations are high. He refused to take a public position on the alleged cuts list that had been the subject of articles in newspapers.
”We’re going to negotiate this and see what the whole economic picture is,” said Katainen.
After the morning session of talks Katainen pointed out the benefits of solid public finances.
”I believe that every available means should be used to secure the welfare state,” said Katainen. The poor man’s best friend is strong government finances.”
On Friday morning the six parties’ negotiators heard expert opinions on Finland’s economy. Official negotiations began in the afternoon. On Friday evening parties will outline their views on tax policy and the need for savings in the budget.
No Euro Opt-outs
Katainen told YLE that the Left Alliance will not be granted an opt-out on European policy in future, if they decide to join the government. The party opposes the Portugal bailout and voted against it in Parliament's Grand Committee, but according to Katainen opposition to any future bailouts would not be tolerated.
"The Left Alliance voted against the caretaker government on this Portugal question, but after that all European policy questions must be settled in these negotiations," warned Katainen.