Government outlined reform of social welfare and health care funding

According to the Government’s policy outline, municipalities cannot in future have significant responsibility for social welfare and health care funding. Municipalities’ main responsibility for funding is considered to be in conflict with the municipal autonomy safeguarded by the Constitution.

The funding of the future autonomous areas will be prepared primarily on the basis of the central government’s responsibility for funding. Alternatively, there will also be further investigation of a model that would be partly based on the autonomous areas’ own right to levy taxes. The effects of these alternative solutions will be assessed and compared.

The Government has agreed in its negotiations policy outlines on the basis of which social welfare and health care funding will be prepared as part of the reform of social welfare and health care and regional administration. The Prime Minister has also consulted on the solution with the leaders of the opposition parties, in a discussion held on 16 October. The solution is based on a proposal of both the project group on the reform of social welfare and health care and regional administration and of the working group on funding.

According to the Government, the preparation of the reform of social welfare and health care funding will be based on the policy outlines of the Government Programme, according to which, in turn, the total tax rate must not rise and taxation on labour must not increase at any income level. More detailed funding policy outlines will be included in a draft Government proposal to be circulated for comment in April 2016.

Attached is a Government-approved memorandum, with justifications, evaluating the options for the reform of social welfare and health care (in Finnish).

Inquiries:
Juha Rehula, Minister of Family Affairs and Social Services, Ministry of Social Affairs and Health, tel. +358 295 163108
Tuomas Pöysti, Permanent State Under-Secretary , Ministry of Social Affairs and Health, tel. +358 295 163012
Terhi Järvikare, Director General, Ministry of Finance, tel. +358 295 530113
Panu Pykönen, Ministerial Counsellor, Ministry of Finance, tel. 358 295 530225

English translation of the press release published on 21 October 2015