FM Saarikko bashes left's attitudes on debt

The Finance Minister says she wants more focus on the health of the economy.

Finance Minister and Centre Party leader Annika Saarikko was a guest on Yle TV1's Ykkösaamu chat show on Saturday. Image: Tiina Jutila / Yle

Finance Minister Annika Saarikko (Cen) on Saturday said central government debt was an unavoidable part of the coronavirus crisis, but that it was now time to move beyond a pandemic mindset.

"Dealing with Covid has been the best economic policy during the pandemic," Saarikko told Yle, saying the government has wanted to care for people's health while helping businesses stay afloat.

Following up on recent austerity comments, Saarikko said it's now time to move into a new phase, which entails the state tightening its purse strings.

Saarikko pointed out that in an aging country like Finland there's constant pressure on spending. She said she wants economic issues, which have fallen in the shadow of climate and Covid, to feature more prominently in public debate.

"My generation has lived during a time of low interest rates. There's no guarantee that trend will continue," Saarikko, who also chairs the Centre Party, said.

Saarikko took aim at her leftist government partners for what she called a lax attitude towards borrowing.

"It seems that the left sees economics changing so fundamentally that the scale and volume of debt doesn't matter that much anymore," she told Yle.

The Finance Minister said the government must stick to its budget framework, which is why she said she was planning to schedule talks with her cabinet colleagues before Christmas.

"Covid-time economic policies can't continue. It's time to move on to policy that supports sustainable economic growth," she said, adding that it's too early to estimate what the effects of the Omicron variant on the economy will be.

The budget framework establishes agreed spending limits for each budgetary year, which the current government has exceeded during this term of office as extra spending was required to help the nation deal with the Covid crisis.

Last year the central government borrowed 18.5 billion euros to mitigate the effects of the pandemic in Finland. The administration overestimated its rescue spending, leaving eight billion for later use. This year Finland is expected to draw 3.7 billion euros in new debt, according to the Finance Ministry.