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Gov't's €5.5b supplemental budget targets municipalities, education, transport

Finance Minister Katri Kulmuni said that Finland won't be able to avoid spending cuts and tax hikes in the years ahead.

From left: Education Minister Li Andersson, Finance Minister Katri Kulmuni, Prime Minister Sanna Marin, Interior Minister Maria Ohisalo and Justice Minister Anna-Maja Henriksson at the government's press conference on Tuesday evening. Image: Antti Aimo-Koivisto / Lehtikuva

Prime Minister Sanna Marin’s government on Tuesday evening unveiled a record fourth 5.5-billion euro supplemental budget aimed at helping heal the damage caused by the coronavirus crisis.

In presenting the spending package however, Finance Minister Katri Kulmuni said that it would not be possible to avoid tax increases and reduced spending in the future.

"I would like to point out and also to warn that public finances must be strengthened after the crisis. Tax increases or spending cuts cannot be avoided in the years ahead," Kulmuni stated.

She also told reporters during a press conference that Finland would be borrowing an additional 18.8 billion euros this year to bankroll its programmes.

Kulmuni said that the supplemental budget will put Finland back on its feet, accelerate growth and make the country stronger post-pandemic.

"Transportation investments will be 450 million euros," Kulmuni said. 18.8 billion euros in additional debt.

Money for municipalities, transport climate

She added that government had earmarked 1.4 billion euros for municipalities -- roughly half of it to improve basic services -- and more than 200 million euros for education. Another 300 million euros will be dedicated to climate action, she noted.

Interior Minister Maria Ohisalo said that government had committed to reserving 755 million euros for transport development, of which more than 600 million will be spent on rail and tram investments.

Public transport providers suffering from restrictions on movement and the resulting loss of commuters will receive 100 million euros to compensate for lost ticket sales, Ohisalo said. Meanwhile another 18 million euros will be directed to programmes to encourage Finnish residents to walk and cycle.

Care package for children and young adults

Education Minister Li Andersson said that government had crafted a 310-million-euro package for boosting the wellbeing of children and young people, noting that the distance learning measure introduced during the epidemic meant that some children needed more support.

She said that the multi-million-euro package would support learning and tackle marginalisation and other social problems caused by the state of emergency.

The Education Minister promised a temporary increase of 60 million euros in income support that would last until the end of the year. She added that local employment offices will receive a subvention of 20 million euros to improve services for the unemployed.

Meanwhile Justice Minister Anna-Maja Henriksson said that policies are needed to address employment.

"We need actions to increase the employment rate and to create new jobs. Our goal is more than 60,000 new jobs," she declared.