Finnish Trade union confederations see the planned state budget as a step forward, but not big enough


Helsinki (19.09.2019 – Heikki Jokinen) The plans for the next state budget seem to be a move in the right direction, but when it comes to the detail there are things that could be done better, say the three trade union confederations.

The results of PM Rinne’s Government planning session for the next state budget were published on 17 September.

SAK, the Central Organisation of Finnish Trade Unions hails the decision to cancel the infamous activation model that punishes unemployed job-seekers, and which was designed and implemented by the previous right-wing Government.

“The activation model is widely seen as unfair and to terminate it is a major relief for the unemployed. SAK’s goal to replace the activation model with reform of employment security is moving forward”, says SAK Chief Economist, Ilkka Kaukoranta.

The new budget provides more money, for example, to employment services, pays subsidies to facilitate hiring, tailored training to facilitate employment, a working capacity programme for people with partial work capacity and launches an overall reform of labour migration and education-based migration.

Ilkka Kaukoranta views these measures as a positive step towards a Nordic employment policy.

“The additional money given to the employment services is, however, modest in comparison to what is needed. Without sufficient resources the individual meeting and support for the unemployed will remain a dream”, he adds.

Kaukoranta also encourages companies to invest now, as the Government is promising direct support and tax incentives for those who invest.

Labour immigration still open

Akava, the Confederation of Unions for Professional and Managerial Staff in Finland also welcomes the fact that the budget session has endorsed a number of measures to improve employment.

To initiate reform of labour migration is positive in itself, Akava says, but stresses that concrete measures are still missing, like terminating the labour availability consideration.

It allows authorities to use the availability of domestic labour as grounds for preventing employers in certain sectors from employing people from outside the European Union and EEA.

Akava says that income tax should not be increased regardless of income level. Because now the Government only plans to cut it for low and middle incomes.

Akava President Sture Fjäder criticises the measures designed to boost research, education and investments as being insufficient. He is, however, very pleased by the 60 million euro extra money promised for the universities and universities of applied sciences.

Antti Koskela, economist at the Finnish Confederation of Professionals STTK calls for an active employment policy. “With the measures proposed now it will be more active, but we are still below the Nordic level.”

With the measures proposed now it will be more active, but we are still below the Nordic level.

STTK calculates that pay subsidies to facilitate hiring should be tripled to reach the Nordic level. At the same time we need reforms that make it more attractive to use this support.

Koskela says that with additional resources education is in honour again. However, after the cuts in education made by the previous Government the new resources are not enough.

STTK is also happy the activation model has now come to the end of the road.

“The Government would do well to remember that the most important decisions in respect of employment and the economy will become apparent in the next collective bargaining round”, Koskela underlines.

The objective of the Government’s economic policy is, in normal international and related domestic economic conditions, to reach an employment rate of 75 per cent in the 15–64 age group in 2023.


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