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Turku to take on €100m more debt to repair schools

Turku is the second-most indebted large city in Finland.

Turun kaupungin vaakunalippu
Image: Andy Ödman / Yle
Yle News

Turku city leaders are planning to take on more debt to finance investments in schools. According to a budget proposal by Mayor Minna Arve, the city is seeking 99 million euros in additional debt for next year.

After Vantaa, Turku is the most indebted large city in Finland, with 3,715 euros of debt per inhabitant. Overall, Turku owed 1.4 billion euros last year.

Yle sent a questionnaire to the Turku council members asking about their views on next year’s budget. Most argue that the city borrows too much.

Council member Jarmo Rosenlöf of the Social Democrats said he’s concerned about the city’s finances. "I’m worried because our city continues to live from hand to mouth. I don’t think we should take out more loans," Rosenlöf said.

Similarly, Finns Party council member Mikael Miikkola says the city has lived beyond its means for years. "This debt will be paid back by the young people of our city. We are actually close to being a crisis town."

Turku plans to renovate or construct new school buildings at a cost of tens of millions of euros in 2019. Four-fifths of the respondents to the Yle survey said they support these plans. "Schools need to be maintained in good shape. Education is the cornerstone of our future," Miikkola added.

However, some council members say there really is no choice. "It’s acceptable to take on this 99-million euro loan so that we can keep our services at the current level," said council member Niina Ratilainen of the Green Party.

According to the budget proposal, the municipal tax rate would remain at 19.5 percent, which is lower than in neighbouring communities.

While most council members agree with maintaining the current tax rate, some argue there may be a need to increase it in the future.

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