Social Democratic Party (SDP) chair Antti Rinne, placed in charge of forming a new government, has announced which parties are to enter formal negotiations. At a press conference late Wednesday morning, he confirmed that the parties entering government coalition talks with the SDP will be the Centre Party, the Greens, the Left Alliance and the Swedish People's Party (SPP).
The parties that came in close second and third places in last month's elections - the nationalist Finns Party and the the conservative National Coalition Party - appear to be heading into the opposition.
The leaders of the five parties launched negotiations at 2pm Wednesday at the House of Estates in Helsinki's Kruununhaka district.
Centre Party chair and outgoing PM Juha Sipilä said earlier in the morning that his party was ready to enter talks on forming the next government coalition.
Sipilä tweeted that eight out of 10 Centre Party leaders polled said the party should try for another cabinet term – despite their heavy losses in last month's parliamentary election.
"Eighty percent of the party's council, board and parliamentary group members support entering government formation negotiations on the condition that the Centre's threshold questions are met. Twenty percent opposed joining government talks. I have informed Antti Rinne," Sipilä said on Twitter shortly after 10 am.
The Centre Party has published a list of 10 threshold demands for the new government agenda. They include targets of 75 percent employment rate and balanced public finances by 2023, no increases in corporate taxes, no increase on farmers' financial burden, reform of regional administration into 18 provinces to support health and social services reform (known as sote), increases for small pensions and "moderate" increases in logging and "sustainable forest use".
After Rinne's press conference, Sipilä said that the Centre Party chair would certainly be a member of the new cabinet, but that it will not be him for long. After the election loss, Sipilä announced that he would step down and called a party congress for 7 September to elect a new leader.
Five-party coalition would hold 117 seats
Yle reported earlier that besides the SDP and the Centre, the parties in the government coalition talks will be the Greens, the Left Alliance and the SPP.
They would have a solid majority of 117 seats in the 200-seat Parliament.
The SDP narrowly won April's election, securing 40 seats in Parliament, just ahead of the nationalist Finns Party with 39 seats and the conservative National Coalition Party (NCP) with 38.
The Centre Party suffered a historic defeat, losing 18 seats for a new total of just 31. That spurred many party faithful to say that the party should sit out the next legislative term among the opposition ranks.
The Greens and Left Alliance gained seats for totals of 20 and 16 respectively, while the centrist SPP held on to its 10 seats, including a representative from the autonomous Åland Islands who votes with the bloc.
Rinne's decision indicates he was unable to agree on basic principles in this week's talks with the NCP. Political analysts such as Yle's Paula Pokkinen say that the right-leaning, pro-business NCP would be unlikely to fit into the same cabinet as the Left Alliance, one of the parties that gained seats in the election and which has traditionally been ideologically close to the SDP.
Another Yle political commentator, Ari Hakahuhta, notes that former union boss Rinne was still weighing last night whether to pick the NCP or Centre as his main partner in talks, but apparently decided that the SDP would be more likely to achieve its electoral promises in tandem with the Centre than the NCP.
And an alliance with populist immigration hardliners the Finns Party was always seen as unlikely. The party's chair, likely future opposition leader Jussi Halla-Aho, did not attend Rinne's press conference, although NCP chair Petteri Orpo did.
Interviewed by Yle afterwards, Halla-aho predicted that the government would carry out "red-green policies" including "irresponsible, generous immigration policies".
Orpo told the news agency STT that he believes the NCP can carry out opposition politics along with the Finns Party.
"For instance, we have very similar views on economic policy. That is one example of an area where we can cooperate," the conservative leader said.
12:13pm updated throughout, corrected number of potential coalition seats
12:42pm updated with party leaders' comments and launch of talks