Monday. 23.09.2019
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2020 budget: increasing child benefits and dismantling activation model

Of the appropriations for the Ministry of Social Affairs and Health and its administrative branch, 33% are allocated to pensions, 29% to offsetting family and housing costs and 15% to unemployment security. A total of 37 million euros has been reserved for increasing child benefits and allowances. There will be also an increase in smaller pensions.
2020 budget: increasing child benefits and dismantling activation model

The Ministry of Social Affairs and Health has made public the details of its draft budget for 2020, which proposes appropriations of about 14.9 billion euros. This is about EUR 170 million less than in the 2019 Budget. The decrease is mainly due to employment growth and to the ending of the temporary reduction in employers’ health insurance contributions.

Among other things, the Ministry’s draft budget aims to improve basic social security and increase pensions for those on the lowest pensions. "The situation of families with children will improve as services for children and families will be enhanced" stressed the Ministry in a press release.

Among the new initiatives included in the project, the Ministry proposes that Child Advocacy Centres will be set up in Finland to help children who are victims of sexual offences. The so-called single-parent increment linked to child benefits will be increased. Child maintenance allowance will also be increased, as well as child benefits for the fourth and each additional child.

Of the appropriations for the Ministry of Social Affairs and Health and its administrative branch, 33% are allocated to pensions, 29% to offsetting family and housing costs and 15% to unemployment security. Health insurance accounts for 13%, promotion of well being for 3% and social healthcare organised by municipalities for 2% of the appropriations. In addition, municipalities’ health and social services will receive funding from central government transfers for basic public services.

Increases in child benefits and child allowance

The Ministry of Social Affairs and Health proposes that both the single-parent increment to child benefits and the child benefits for the fourth and each additional child will be raised by 10 euros from the start of 2020. The ministry proposes an increase of 7 euros in the child maintenance allowance. A total of 37 million euros has been reserved for these reforms.

The Ministry proposes a sum of 4.3 billion euros for offsetting family and housing costs, for basic social assistance and certain other services. This is 50 million euros less than in 2019. The decrease is mainly due to lower needs estimates for housing allowance and basic social assistance.

Increasing small pensions

The Ministry of Social Affairs and Health also proposes an increase in small pensions. The full amount of the national pension will be increased by 31 euros and the full amount of the guarantee pension by 50 euros per month. The increase will be targeted at those whose pension is less than about 1,000 euros a month. The costs to central government arising from this amount to 183 million.

The ministry also proposes that the funding contributions for farmers’ accident insurance be revised. This will save 1 million euros in central government expenditure and increase the costs for the insured by 1.4 million euros. The revision of the calculation basis for treatment costs used by the Farmers' Social Insurance Institution will increase central government costs by about 5 million euros.

The Ministry of Social Affairs and Health proposes an additional appropriation of 38.8 million euros to be allocated to the Social Insurance Institution of Finland (Kela).

Basic security

The Ministry of Social Affairs and Health proposes an increase of 20 euros for basic security, which means the minimum rehabilitation allowance, sickness allowance, parenthood allowance, unemployment security basic daily allowance, and labour market support. The costs to central government arising from this amount to 40 million euros.

The draft budget also proposes that the fixed term for using conditional reimbursement status in the medicine reimbursement system will be continued. The objective is to gain more experience of a model where the risk of introducing new medicines is divided between the pharmaceutical industry and society.

The Ministry proposes an appropriation of 28.4 million euros for rehabilitative work, which is 1.5 million euros more than in 2019. The increase is due to the growing number of clients. Other measure plans to allocate 1.98 billion for funding health insurance. This is 443 million euros less than in 2019. The decrease is mainly due to the effects of the Competitiveness Pact.

Services for children and families

The Ministry of Social Affairs and Health proposes that an appropriation of 18 million euros will be allocated in 2020 for the improvement of services for children and families and for continuing the programme to address child and family services.

There is another budget allocation of 21.6 million euros for shelter activities, and 2 million euros of that sum will got to increase the number of places in shelters. For the treatment of mothers suffering from substance abuse, the ministry proposes an appropriation of 3 million euros.

The Government also wants that Child Advocacy Centres will be set up in Finland to help children who are victims of sexual offences. The appropriation proposed for these amounts 1.6 million euros in 2020.

Health and social services

The Ministry of Social Affairs and Health proposes an appropriation of 307 million euros for healthcare and social welfare services organised by municipalities. This is 105 million euros more than in 2019. The increase is mainly due to an appropriation of 99 million euros intended for the development of health and social services.

The appropriations are allocated for developing and improving basic services by, for example, providing further details of the care guarantee and the minimum number of personnel in units providing care for older people. In addition, informal care and home care will be improved, a national mental health strategy will be prepared, a personal budget for people with intellectual disabilities will be experimented with, and family services and pharmaceutical services will be further developed.

Central government funding for medical helicopter services is the same as for 2019, approximately EUR 29 million. The Ministry of Social Affairs and Health proposes an appropriation of 7.1 million euros for mediation in criminal cases.

Health Sector Growth Strategy

The Ministry of Social Affairs and Health proposes an appropriation of 11.2 million euros to support the growth strategy for the health and social services sector.

The measures support the establishment of national centres of excellence and the development of their activities. The centres of excellence refer to the National Cancer Centre, Neurocenter Finland and the biobanks, as well as the Genome Centre and Drug Development Centre already in preparation. The ministry proposes a total of 5.2 million euros to be allocated for the operating expenses of a licensing authority administering the use of health and social data. A data permit authority started its operations in 2019.

The ministry proposes an appropriation of 212 million euros in total for the operating expenses of the agencies and public bodies within the ministry’s administrative branch.

Partial dismantling of activation model

The Ministry of Social Affairs and Health proposes that the reductions and obligations of the activation model be dismantled when measures with corresponding employment impacts have been decided. The costs to central government arising from this amount to 13.7 million euros. The ministry proposes an appropriation of 2.22 billion euros for unemployment security. This is 148 million euros less than in 2019. The decrease is mainly due to employment growth.

The financing of pay subsidies from the appropriation for unemployment benefits should continue in 2020. In addition, it is planned the implementation of a national development programme for work and well being at work in 2020–2022. The ministry proposes that an annual appropriation of 4 million euros be granted for the programme.

National vaccination programme

The national vaccination programme will be reformed: in future, the tick-borne encephalitis (TBE) vaccination will be available in a greater number of regions, and the vaccine against papillomavirus (HVP) will also be available for boys. The Ministry of Social Affairs and Health proposes to allocate 2 million euros for these measures. Other 2.26 million euros will be destined to cover the increasing costs of influenza vaccines.

For the promotion of health and functional ability, the Ministry proposes an appropriation of 40.5 million euros. This is 5.3 million euros more than in 2019.

Action Plan for Gender Equality

The draft budget includes an appropriation of 0.5 million euros for the Action Plan for Gender Equality and Equal Pay Programme. Those funds will be used "for measures that will make society more equal", says the Ministry.

Research and education

The Ministry proposes an appropriation of 27.8 million euros for the funding of university-level medical research in healthcare units. In addition, other 96 million euros would be for central government compensation to healthcare units to cover costs arising from medical and dental training.

There would be also an increase of 1.75 million euros in the funding destined to the World Health Organization (WHO).

War veterans, conscripts and their families

208 million are proposed to be spent in the support of veterans. This is 11 million euros less than in 2019. The main reason for this is that the number of war veterans is diminishing year by year.

Of this sum, 62 millions will be allocated for military injuries indemnities, 25 millions for the operating costs of institutions for war invalids, 7.3 millions for front-line veterans’ supplements and 107.6 millions for the rehabilitation of front-line veterans and services provided in their homes.

The Ministry proposes to allocate 5 million for the rehabilitation of disabled veterans’ spouses, widows and war widows, for the rehabilitation of those who served in certain war-time tasks and for a front-line allowance for certain foreign volunteer front-line soldiers. And 1.1 million euros as the central government’s compensation for the care of those who suffered in the wars.

Farm relief services and temporary help

Expenditure on farm relief for farmers and fur producers will decrease by 11.9 million euros from the previous year and will total 122.8 million euros. This reduction is due to a needs assessment change. The Välitä viljelijästä (Consideration for farmers) project will be continued, and appropriations have been reserved for the project for 2021–2022 as well.

Grants to associations and foundations

For grants to associations and foundations to help them promote health and social welfare, the Ministry of Social Affairs and Health proposes an appropriation of 380 million euros, 18 millions more than in 2019.

This is possible thanks to the unallocated gambling proceeds from previous years and the decreased appropriation requirements of the budgetary items to be financed by Veikkaus Oy’s proceeds.

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