Government submits supplementary budget proposal to Parliament

On Thursday 21 March, the Government submitted a supplementary budget proposal for 2024 to Parliament. The proposal includes appropriations for speeding up the construction of the fence on the eastern border, introducing targeted measures to alleviate the situation in the construction sector and providing additional support to Ukraine. In addition, it proposes reducing revenue estimates by EUR 1.3 billion based on the forecast published by the Ministry of Finance in December 2023.

In line with the supplementary budget proposal for 2024, the appropriation requirement will increase by just under EUR 0.2 billion, while actual revenue will decrease by EUR 1.3 billion. Together, these will increase the central government’s net borrowing requirement by almost EUR 1.5 billion. Net borrowing is expected to total around EUR 12.9 billion in 2024.

Revenue estimates take into account Ministry of Finance's December forecast

The Government proposes reducing the tax revenue estimate by EUR 1.4 billion. The new tax revenue estimate is based on the macroeconomic forecast published by the Ministry of Finance in December 2023, meaning that the 2024 budget has been updated to reflect the current situational picture. The changes can largely be explained by the lower than anticipated tax revenue in 2023 and the weakened economic outlook. 

An increase of EUR 280 million is proposed in dividend income received by the state. The additional dividend income will later be used to finance expenditures related to the Government’s investment programme.

The Greek state made the 2024–2025 repayments on its loans to Finland in advance in December 2023. For this reason, it is proposed that loan repayments to the central government in 2024 be reduced by EUR 50 million. 

Speeding up construction of the eastern border fence and increasing support for Ukraine

The Government proposes that an appropriation of EUR 74 million be brought forward from 2025 to 2024 to speed up the construction of the fence on the eastern border. The new timetable will not change the overall funding needs of the project. In addition, an increase of EUR 12.2 million is proposed to the operating expenditure of the Border Guard due to additional costs incurred before 31 January 2024 from measures taken to manage instrumentalised migration.

An appropriation of EUR 30 million is proposed for Finland’s participation in the international joint procurement of munitions to support Ukraine. In addition, increases in appropriations are proposed as follows: EUR 2 million for the operating expenses of the Finnish Security Intelligence Service, EUR 3 million for the further development of the authorities’ joint field command system and EUR 3.5 million for the exercise of the central government’s pre-emptive right to purchase real estate in Kimitoön.

Alleviating the situation in the construction sector

Due to the weak economic conditions in housing construction, it is proposed that the approval authority for interest-subsidised loans be raised by EUR 750 million to EUR 2,250 million. This is a temporary measure aimed at alleviating the employment and economic conditions in the sector and enabling the construction of right-of-occupancy housing projects that submitted applications by the end of 2023.

In addition, the Government proposes increasing the annual investment and borrowing authorisation of Senate Properties, which provides workspace services to central government authorities, by just over 10 per cent. The goal is to enable premises investments that promote productivity and meet the needs of the security authorities.

Funding for the new Aviation Museum building and the renovation of the Tampere Theatre; support for physical activity, elite sports and youth work

The Government proposes that unused gambling proceeds returned to the Ministry of Education and Culture in previous years be allocated on a one-off basis as follows: EUR 10.3 million for arts and culture funding, EUR 3.2 million for sports and physical activity and EUR 3 million for youth work. Of the proposed increases to the promotion of arts and culture, EUR 7 million would be allocated to the Finnish Aviation Museum Foundation for the construction of a new museum building and EUR 3 million for the renovation of the Tampere Theatre. An increase of nearly EUR 3.2 million is proposed for developing elite sports and major events and for promoting equality in sports and physical activity. An increase of EUR 3 million would be allocated to youth outreach work and youth workshop activities.

Compensation to producers for production animals ordered to be killed

EUR 44.4 million is proposed in statutory compensation for fur animals killed in order to eradicate avian influenza. In addition, EUR 0.8 million will be reserved for compensation to producers for pigs ordered to be killed due to salmonella infection.

Inquiries: Mikko Martikkala, Special Adviser to the Prime Minister in Economic Affairs, tel. +358 295 161 171, mikko.martikkala(at)gov.fi, and Jussi Lindgren, Special Adviser to the Minister of Finance in Economic Affairs, tel. +358 295 530 514, jussi.lindgren(at)gov.fi