Skip to content

Finance minister suggests bonus child benefit payment to help families

The minister suggested paying families with children a one-time bonus at the end of the year, but the children's ombudsman says that's not enough for Finland's most vulnerable.

Social insurance agency Kela pays the benefits to children who are permanently resident in the country until they turn 17 years of age. Image: Tiina Jutila / Yle

In light of the ballooning cost of living, the Minister of Finance, Annika Saarikko (Cen), has suggested that families with children should receive a one-time supplementary allowance payment at the end of the year.

The minister first floated the idea on Yle TV's current affairs show A-studio on Wednesday evening and then said more about the suggestion on Twitter.

"Families with children are a group that need attention. After the coronavirus situation improved, the birth rate in Finland has been unusually low. We cannot afford for families to feel unwell — we need to take care of every child," Saarikko said on A-studio.

This week, the finance ministry began work on hammering out next year's state budget.

The minister said that families with kids are taking particular financial hits amid growing food, energy and transportation costs.

Annika Saarikko Image: Sakari Piippo / Yle

"Most of their income is spent on keeping their everyday lives going," she tweeted on Wednesday night.

Social insurance agency Kela pays (siirryt toiseen palveluun) the benefits to children who are permanently resident in the country until they turn 17 years old.

Saarikko noted that Finland's child allowance payments, which families of all children are eligible to receive, are not index-linked. This means that the payments don't increase when the inflation rate rises.

She said the bonus benefit allowance would be a one-time payment, suggesting that the state would not need to borrow funds to implement it.

For families with many children, the bonuses could mean additional funds of up to hundreds of euros, as the allowances go up with each additional child. For example, a first child is eligible to receive monthly payments of around 94 euros, the second child gets 104 euros, while a third child is entitled to 133 euros.

"Not enough for poorest families"

However, the Children's Ombudsman, Elina Pekkarinen, said the bonus would not be enough to truly help the country's poorest families.

She pointed out that inflation has weakened the purchasing power of the allowance, pointing to an estimate that the benefit has comparatively dwindled by as much as 30 percent of its original worth.

Converted to the current value of the euro, the average child allowance in 1995 stood at around 145 euros per month. In 2014, after the benefit was cut, it was valued at 122 euros.

Elina Pekkarinen Image: Niko Mannonen / Yle

However, Pekkarinen agreed that bonuses in the hundreds of euros would be a significant boost for families. She said that distributing the allowance to all families would be a way to help out everyone, but also those who don't need it.

She described the minister's suggestion as a symbolic gesture for all families in Finland.

But, she said that in order to cope properly, in addition to the bonuses, the country's poorest families need more targeted measures such as supplementary and other income support as well as help from organisations.

Despite this, Pekkarinen said she approved of across-the-board bonus payments because all families are dealing with rising costs.

Pekkarinen noted, however, that the extra payments won't affect Finland's lagging birth rate.

"State subsidies by themselves are not enough to increase the birth rate. That requires big changes in working- and family life and a child- and family-friendly atmosphere," the children's ombudsman said.

Citing finance ministry estimates, news agency STT reported that distributing the bonuses to all families with children would cost the state around 112 million euros.