Social security reform progresses
Finland’s social security reform aims to streamline and simplify the social security system and to introduce more incentives for work. During this parliamentary term, the social security reform will include both government projects and the work of the Social Security Committee.
The Government's social security projects include a reform of basic income security with the introduction of a general social security benefit, a reform of social assistance, and a reform of the general housing allowance.
Preparations advance for introducing a general social security benefit
In line with the Programme of Petteri Orpo's Government, the Ministry of Social Affairs and Health has set up a working group to prepare a reform of basic income security. This includes drawing up a model for a general social security benefit that will combine several forms of basic income security.
The working group includes specialists from the Ministry of Social Affairs and Health, Ministry of Economic Affairs and Employment, Ministry of Finance, Finnish Institute for Health and Welfare and Social Insurance Institution of Finland (Kela). Key labour market organisations, civil society organisations and other stakeholders will be consulted during the process.
The working group will continue their work until the end of the government term.
Reforming social security with a general social security benefit
In line with the Programme of Prime Minister Petteri Orpo's Government, the Government will implement a reform of basic income security to improve the profitability of work, streamline social security and simplify benefits, taking into account the recommendations and reports issued in the Social Security Committee’s interim report.
The reform aims to create a general social security benefit that would include a basic allowance for living costs, an allowance for housing costs and a discretionary allowance as last-resort social security. This general social security benefit will taper against increasing income from work as linearly as possible, making it easier for people to predict their earnings and make it more worthwhile to take on work.
The general social security benefit is a cause-based benefit, which means that there must be a reason for receiving it. The criteria and grounds for being entitled to a basic income security benefit will vary depending on the claimant's life situation. Claiming the benefit imposes obligations on the claimant, such as contributing to finding a job, accepting the offered services, pursuing education and training or rehabilitation, or other specifically mentioned obligations.
The preparation of the new benefit model will advance in stages, starting with a design for a single application model for Kela, and introduction of a general social security benefit for the first stage of the reform by the Government's mid-term policy review session. The procedural provisions concerning different benefits that guarantee a basic level of income security will be merged and the grounds for determining the benefits examined.
Working group prepares a comprehensive reform of the Act on Social Assistance
In line with the Programme of Prime Minister Petteri Orpo's Government, and as required by Parliament, the Government will implement a comprehensive reform of social assistance that will improve people’s ability to live independently, reduce long-term dependency on social assistance and clarify the role of social assistance as a last-resort discretionary cash benefit included in basic income security.
A working group has been tasked with preparing a draft government proposal on amendments to the Act on Ssocial Aassistance and to closely related legislation.
The term of the working group will end on 31 December 2024. The working group will prepare a proposal of measures by the Government's mid-term policy review session so that the government proposal can be submitted to Parliament in autumn 2025.
Social Security Committee discusses key social security issues and monitors the preparation of the general social security benefit
During its second term, the Social Security Committee will address three different subject areas and monitor the preparations for launching the general social security benefit. The subject areas are:
- Responsiveness of benefits and services to people’s life situations (particularly unemployment, illness, incapacity for work and related services)
- The level of social security and combinations of social security benefits, the relationship between basic income security and last-resort financial assistance and their role in the social security system
- Individual and family-specific benefits, maintenance liabilities and different housing and family situations
The Social Security Committee's working term is two government terms (2020–2027).
Inquiries
Teresa Salminen, Special Adviser, tel. 0295 163 109, [email protected]
Liisa Siika-aho, Director General, tel. +358 295 163 085, [email protected]