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Budget proposal for 2019 for the Ministry of Social Affairs and Health's administrative sector

Ministry of Social Affairs and Health 14.9.2018 13.20 | Published in English on 19.9.2018 at 13.09
Press release 123/2018
Budget proposal for 2019 for the Ministry of Social Affairs and Health's administrative sector

In its budget proposal for 2019, the Government proposes an appropriation of EUR 15 billion for the Ministry of Social Affairs and Health's administrative sector.

This is about EUR 6.1 million less than in the 2018 Budget. The reduction is mainly due to employment growth.

The Ministry of Social Affairs and Health draft budget includes, for example, improving the position of adoption and multiple-birth families and front-line veterans, improving the access of entrepreneurs' family members to unemployment security and preventing inequalities by raising the level of minimum daily allowances and guarantee pensions.

The draft budget of the Ministry also lengthens the paternity benefit period for multiple-birth fathers, gives single mothers the right to parental allowance days that correspond to paternity allowance, lengthens the parental allowance period for adoptive parents and extends the national vaccination programme.

Research and innovation activities will be strengthened by establishing a national licensing authority to administer the use of data stored by healthcare and social welfare services and by establishing a new national pharmaceutical development centre.

Of the appropriations for the administrative branch of the Ministry of Social Affairs and Health, 31% is allocated to pensions, 29% to compensating family and housing costs and 16% to unemployment security. Health insurance accounts for 16 per cent of the appropriations.

Inequalities will be prevented

The minimum parental allowances, rehabilitation allowances and special care allowances will be raised to the same level as labour market support. This reduces inequality. Daily allowances will increase by EUR 80.50 per month. The total costs arising from this to the central government will amount to about EUR 18.9 million.

The criteria for vocational rehabilitation of young people will be eased and young people will receive rehabilitation allowance during the whole period of the rehabilitation decision. These changes will support young people in their studies and employment. In addition, the annual income limit for drug reimbursements will be reduced. The impact of this on the central government transfers will be EUR 5 million.  Health insurance reimbursements will continue for treatment provided by private service providers in public facilities.

The 55-day personal contribution period for sickness allowances will be abolished and at least a minimum level sickness allowance will be paid on the same grounds to all.  This will increase central government expenditure by EUR 4.4 million.

The Ministry of Social Affairs and Health reserves an appropriation of EUR 2.43 billion for funding health insurance. This is EUR 306 million more than in 2018. The increase is mainly due to the effects of the Competitiveness Pact. Reducing employers' social security contributions increases the need for the appropriation by EUR 165 million compared with the 2018 Budget.

The Government proposes that EUR 10 million will be allocated to raising of the level of guarantee pension, which will increase guarantee pension by EUR 9 per month.  The increase of guarantee pension will reduce the basic social assistance expenditure by about EUR 0.7 million. Pension subsidy, rehabilitation allowance for young people and minimum daily allowance for vocational rehabilitation will be raised to the same level as guarantee pension. The limit of earnings for suspending a pension will also be raised to guarantee pension's level. In addition, the implementation of pension subsidy for long-term unemployed, the so-called Lex Lindström, will be continued.

The Ministry of Social Affairs and Health reserves EUR 4.6 billion for its total expenditure on pensions .

Position of adoption and multiple-birth families will be improved and residence-based social security will be reformed

The paternity allowance period for multiple-birth fathers will be extended and single mothers with sole custody of their child will be eligible for the parental allowance period corresponding to the paternity allowance period. The parental allowance period for adoption parents will be extended. The cost impact on central government totals EUR 0.5 million.  The Ministry of Social Affairs and Health reserves EUR 0.3 million for raising the adoption support for international adoptions.

The provisions determining the grounds for parental allowances will be revised so that performing tasks as an elected municipal official will not be considered as gainful employment anymore. This change will make it possible to pay parental allowance at the full amount for days when a parent is carrying out duties as an elected official.

Residence-based social security will be reformed so that employees coming to Finland do not need to have an employment relationship with a minimum duration of four months or meet the requirements concerning weekly working hours. Instead, the right to residence-based benefits will be based on a defined minimum level of income.  The rules on the right of foreign students to residence-based social security will be eased. On the other hand, the right to Finnish social security will be tightened for people working or living abroad. These measures will decrease government expenditure by EUR 0.5 million.

Appropriations totalling EUR 4.4 billion are proposed for offsetting family and housing costs, for basic income support and certain other services. This is EUR 57 million more than in 2018.

Improvements planned regarding health services for higher education students

The Government proposes that from 2021 on, the Social Insurance Institution of Finland (Kela) will be the organiser of student healthcare services for higher education students. The Finnish Student Health Service (YTHS) will provide the services. This will ensure equal services that function well for students and help create conditions for narrowing differences in health and wellbeing. A total of EUR 3 million was reserved for preparing the changes relating the YTHS and EUR 0.9 million were reserved for Kela's operating expenditure.

Compared with the 2018 Budget, an additional EUR 2 million was reserved for shelter services. The appropriation for the shelter services is then EUR 19.6 million. An appropriation of EUR 3 million is reserved for treatment of mothers suffering from substance abuse. It's the same sum as in 2018. Central government funding for medical and medical helicopter operations will be the same as in 2018, i.e. approximately EUR 29 million.

Access of entrepreneurs' family members to unemployment security becomes easier

Access of entrepreneurs' family members to unemployment security becomes easier. The position of non-owner family members of entrepreneurs will be changed from entrepreneur to employee. The non-owner family member will be subject to a work requirement of 12 months. In addition, a review period of 12 months will be introduced during which non-owner family members shall not have had ownership or exercised control in the business. The amount of funding reserved for this is EUR 10 million.

Accepting short-term jobs will also be facilitated. The system of adjusting the unemployment benefit to the recipient’s earnings will be amended so that the adjusted unemployment benefit will be calculated using the date of payment instead of the dates of earning the income. In other respects, the provisions on benefit adjustment will remain unchanged. The Ministry allocates EUR 20 million for this improvement of incentives to accept work.

The Ministry of Social Affairs and Health reserves an appropriation of EUR 2.37 billion for unemployment security. This is about EUR 296 million less than in the 2018 Budget. The reduction is mainly due to the drop in the unemployment rate. Wage-subsidised work will be financed from unemployment benefit appropriations and employment appropriations in 2019, too.

National vaccination programme will be extended

The national vaccination programme will be reformed by extending influenza vaccination to children younger than seven years of age. The Ministry of Social Affairs and Health allocates an appropriation of EUR 1 million for this reform.

For the promotion of health and functional ability, the Ministry of Social Affairs and Health reserves EUR 35 million. This appropriation remains almost at the same level as in 2018 Budget.

A new licensing authority and a pharmaceutical development centre will be established in Finland

As part of the research and innovation activities within the healthcare sector, the Ministry of Social Affairs and Health allocates EUR 3.3 million for the establishment of a new licensing authority to administer the use of data stored by the health and social services. This new licensing authority would ensure that licences to use health and social services' data resources could be obtained from one place and that the data would be utilised better than ever for reforming health and social services. The licensing authority will start its operations in 2019.

In addition, the Ministry of Social Affairs and Health reserves EUR 1.5 million for the first phase of the establishment of a new pharmaceutical development centre in 2019.

The aim of these measures is that Finland would be at the forefront and would be an internationally sought-after partner in top healthcare research, which utilises health and social service data resources.  In addition, the aim is to initiate new business activities benefiting the health and social services sector and to create jobs in Finland.

Other research and education

EUR 21 million will be available in State financing for university-level research in healthcare service units, and EUR 96 million in State remuneration for medical and dental training in these units. Both will remain approximately at the same level as a year ago. The appropriation for training compensations includes EUR 1.3 million for the training of specialist social workers. The Ministry of Social Affairs and Health allocates an increase of EUR 0.15 million for mediation in criminal cases.

Support for war veterans, conscripts and their families

Support for war veterans will amount to EUR 218.7 million. This is EUR 28.7 million more than in 2018. This increase in appropriations mainly depends on a new arrangement (from 1 November 2019) where front-line veterans will receive the same services provided in their homes as war invalids.

Of this sum, EUR 85.4 million will be allocated for military injuries indemnities, EUR 38 million for the operating costs of institutions for war invalids, EUR 9.5 million for front-veterans' supplements and EUR 77.9 million for the rehabilitation of front veterans and for services provided in their homes.

An appropriation of EUR 6.6 million is reserved for the rehabilitation of war invalids' spouses and widows and of war widows, for the rehabilitation of those who served in certain wartime tasks and for front-line allowances to be paid to some foreign volunteer front-line soldiers. The Ministry of Social Affairs and Health reserves an appropriation of EUR 1.3 million as compensation out of State funds for the care of those who suffered in the wars.

A new additional compensation will be enacted for persons who have become disabled while performing military service and to close relatives to persons who have died while performing military service. The cost of the new compensation would be about EUR 2.5 million per year and it will be covered from the Ministry of Finance main title of expenditure.

Farm relief services and temporary help

Costs for relief services to farmers and fur producers will fall by EUR 8 million from the previous year and will total EUR 155 million. This reduction is due to a needs assessment change. An appropriation of EUR 3 million project is allocated to the project "Välitä viljelijästä" supporting farmers to cope.

Grants to non-profit organisations and foundations

The Ministry of Social Affairs and Health allocates an appropriation of about EUR 362 million to non-profit organisations and foundations for promoting health and social welfare.  The appropriation is EUR 3.9 million more than in 2018 because now there is a more precise yield estimate available and less need to finance other budgetary items by Veikkaus Oy's proceeds.

Health and social services reform and digitalisation of services

The Ministry of Social Affairs and Health continues to prepare the health and socials services reform and to support the preparation of counties in accordance with a new time schedule. The Ministry's resources for the reform will be at the same level as in 2018. The funding allocated for the preparation and support of the regional government, health and social services reform belongs to the appropriations of the Ministry of Finance, which the ministries use collectively. 

The Ministries reserve a total appropriation of EUR 211 million for 2019 for the national support of the regional government, health and social services reform, the digitalisation of public administration and services, and for the ICT investments necessary with regard to regional and national services.  Once the Freedom of Choice Act has been adopted, freedom of choice pilot projects will be launched to support the implementation of the Freedom of Choice Act as part of the health and social services reform. The total amount of funding reserved for the pilot projects is EUR 200 million.

Inquiries:

Niina Vilkman, Special Adviser, tel. +358 295 163 107 (general questions)
Kari Synberg, Special Adviser, tel. +358 295 163 106 (general questions)
Elina Das Bhowmik, Special Adviser, tel. +358 295 163 109 (general questions)
Satu Mäki-Lassila, Special Adviser, tel. +358 295 163 110 (general questions)
Kirsi Varhila, Director-General, tel. +358 295 163 338 (health and social services reform and service system)
Markku Tervahauta, Director-General, tel. +358 295 163 167 (services, health and wellbeing, environmental health, Funding Centre for Social Welfare and Health Organisations STEA, war veteran matters)
Outi Antila, Director-General, tel. +358 295 163 164 (social insurance matters)
Liisa Siika-Aho, Director, tel. +358 295 163 085 (social insurance matters, benefits)
Hannu Ijäs, Director, tel. +358 295 163 248 (guarantee pension, compensations for military accidents)
Essi Rentola, Director, tel. +358 295 163 155 (residence-based social security)
Liisa-Maria Voipio-Pulkki, Director of Strategic Affairs, tel. +358 295 163 382 (health sector growth strategy for research and innovation activities)
Taru Koivisto, Director, tel. +358 295 163 323 (vaccination programme, appropriations for health promotion)
Mikko Staff, Financial Director, tel. +358 295 163 214 (budget)
Tomas Forsström, Head of Financial Planning, tel. +358 295 163 563 (agencies and public bodies)
Susanna Grimm-Vikman, Ministerial Adviser, tel. +358 295 163 172 (social welfare and healthcare, central government transfers to local government, unemployment security)
Marianne Koivunen, Senior Financial Officer, tel. +358 295 163 573 (social insurance)
Taina Korpi, Senior Specialist, tel. +358 295 163 166 (discretionary government transfers, central government transfers to local government)
Minna Liuttu, Senior Financial Adviser, tel. +358 295 163 582 (social insurance)
Lassi Kauttonen, Ministerial Adviser, tel. +358 295 163 577 (grants from the Funding Centre for Social Welfare and Health Organisations STEA)
Minna Saario, Director, tel. +358 295 163 146 (health and social services reform and service digitalisation)
Jukka Lähesmaa, Senior Specialist, tel. +358 295 163 139 (licensing authority for the use of health and social data)

Links to other websites

Ministry of Finance draft budget 2019 (in Finnish)
Budget proposal for 2019 for the Ministry of Social Affairs and Health's administrative sector (in Finnish)