Finnish government planning election budget

The present government is about to start planning next year’s budget. This will be their election budget and we should watch it closely for “pork barrel” gifts to families and friends of the 2 main parties in this government.

Nothing is leaking out at the moment but it is instructive to look back to an article in FinnishNews written about last years’ budget from September 2017:

The private sector has managed to pull itself out of the 2007 stupor with improved exports across many sectors of the economy. Domestic consumption and housebuilding was the first lurch out of the hole and now exports have done well.The present government’s sole achievement this last 26 months has been to allow shops to be open 24/7, but they have done very little else, apart from tinkering with taxation and making small adjustments here and there.

Many major items are still hanging in the air and waiting for some conclusion:

  1. How will parents be given greater freedom to enjoy paternal leave? Currently mothers are entitled to much longer periods of maternal care leave than men, thus stunting female opportunities at work. Old-fashioned religious paternalistic beliefs seem to hold back getting more women into the work force quickly, and that is damaging Finland’s economy.
  2. Too many profitable large companies are receiving big grants for R&D, while SME’s, the future of innovations and employment are starved of these grants.
  3. Too little is being done to radically reduce the high levels of youth unemployment.
  4. There are strong reasons to fear that labor unrest will raise its ugly head in the coming months. The government has not shown strong leadership in even dealings with both sides of the unions.
  5. The education budget, in particular for higher education, has been subject to heavy cuts without clear strategic thinking.
  6. The healthcare reform proposal has been delayed, and still looks as if it may not reduce costs but increase them.
  7. The proposal for new Counties looks as if it will be a costly political exercise without any clear strategic direction, while a major reduction in the number of municipalities is not even being considered.
  8. Immigration is a “no-go area” of public discussion. Politicians have their heads in the sand…
  9. Public debt is still growing and there is a consensus, outside the government, that this public debt will not stop growing in 2021, which will be one year after the next general election – “so not my problem!”

In fact, none of the above have seen any real progress! The government has done nothing for young families to help women get more work opportunities. Big companies still receive huge handouts as government subsidies – there was no change in policy! Youth unemployment is still ridiculously high. Labour unrest has been calm – some good news… Education budgets cut and The Healthcare Reform and the New Counties proposal are still in hanging around without closure. The immigration situation is still without any clear policy – “We follow Germany”… says the PM, and Germany is completely at sea on this… and public debt still grows…

If you expect big tax cuts and lots of other big financial promises from your ruling elite then do not hold your breath! They have almost no room for tax cuts, and the spiraling costs of their present plans will probably cause indirect costs of living to go up. We have already seen how electricity transmission costs has risen after privatization, now they are planning to privatize parts of the rail services, and the taxi reform is just a rip off for passengers.

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