Two of the world’s best thinkers and scholars, Nassim Nicholas Taleb and Yuval Noah Harari, have consistently stated that big reforms by governments are always dangerous, especially so when they increase the centralisation of government.
The two thinkers concur that such individual reforms will almost always end up with costly unintended consequences. Both writers have produced books on such subjects:
- Taleb – “The Black Swan”, “Antifragile”, and the most relevant “Skin in the Game”.
- Harari – “Homo Deus”.
The Finnish government is irresponsibly ignoring these express warnings from these 2 scholars by taking a reckless attitude towards introducing 2 huge reforms, at the same time, without any comprehensive studies or composed understanding of the estimated costs and savings, or the risks involved of unintended consequences of these reforms.
The first big reform has been designed for public social- and healthcare. These are two key basic services, which are available to the whole population, and paid for by general taxation and user fees throughout the whole country. The present proposals have been subjected to many changes through the efforts of private lobby groups, political wheeling and dealing, but with very little input from social and healthcare professionals, many of whom roundly criticize the proposals in their present format.
The government claims that these proposals will result in €3 billion cost savings and more effective availability of basic and preventive social and healthcare services in the future. However, no detailed analysis has been put forward by the government to support these claims, and many experienced project managers, who are familiar with such projects, see huge risks that the final costs will probably be many times greater than the planned savings.
The second reform is the creation of a third form of regional government called Counties, of which there will be 19. This is a huge huge number of new entities involving over 200 00 staff and thousands of newly elected officials, all of whom need to be housed in new offices and facilities. Up until now some 300 municipalities are responsible for social- and healthcare activities. Unfortunately, the government did not even attempt to reform the number of municipalities, a far simpler reform that has already been implemented in Sweden and Denmark that would have brought huge cost savings without any great disruption to Finland’s public sector.
Again, this “reform” not a cost saving activity but a cost creating activity especially designed as a power grab by the Centre Party. They also link this reform to the social- and healthcare reform by allowing these new Counties to take over responsibility for social and healthcare activities.
The second reform which involves the creation of a third layer of government in Finland is exactly the opposite of what the present government promised in their election manifesto in 2015, where they promised to reduce regulation and make government more efficient!
The social and healthcare reform was originally said to secure some €3 billion in cost savings, but this number has gradually melted away. There are no longer any cost figures being given for the expected IT costs, which are expected to cost many times more than the initially stated €1.5 billion by Mr. Pöysti, the civil servant initially in charge of the project back in 2017.
Mr Taleb succinctly states that, typically, none of the present leading politicians in central governments will be around after the implementation of such large reforms. They will blame their successors for cost overruns, and system and policy failures – that will be easy because they have no skin in the game…