Comments requested on comprehensive reform of social assistance

The Ministry of Social Affairs and Health requests comments on the comprehensive reform of the Social Assistance Act by 27 June 2025. The amendments to the Act would strengthen, for example, the obligations of recipients to apply for primary benefits and full-time work. The aim is to reinforce the role of social assistance as a last-resort and temporary form of assistance and to strengthen general government finances.

In line with the Programme of Prime Minister Petteri Orpo's Government, 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 social security.

Strengthening the obligation to apply for primary benefits and full-time work

The reformed Social Assistance Act would impose a stronger obligation on applicants for social assistance to apply for primary benefits instead of social assistance. The primary benefits include unemployment security benefits and student financial aid. If an adult applicant for social assistance had not applied for a primary benefit payable, for example, on the basis of studies, unemployment, illness or incapacity for work before applying for social assistance, the Social Insurance Institution of Finland (Kela) should assess whether they qualify for such a benefit. If, before applying for social assistance, the person failed to apply for primary benefits within one month of being requested to do so by Kela, the basic amount of social assistance would be reduced by 50 per cent.

According to the draft proposal, the obligation to register as an unemployed jobseeker could, in future, mean seeking full-time work. Thus, it would also be obligatory to seek full-time work under threat that the basic amount be reduced in cases where a person who has the capacity and ability to work does not work full-time, business activities are not profitable or a person is not entitled to receive student financial aid for their studies.

One of the aims of the proposed changes is that applicants for social assistance would seek to safeguard their livelihoods, as a rule, by applying for primary benefits before social assistance or by engaging in gainful employment, for example. Another aim is for unemployed people to always register as jobseekers seeking full-time work and, at the same time, to start accessing employment-promoting services and to have their need for services assessed.

Process of reducing the basic amount of social assistance due to unemployment security sanctions to be streamlined

If the payment of the unemployment security benefit granted to the recipient of social assistance is suspended due to sanctions laid down in the Unemployment Security Act, the basic amount of social assistance would be reduced. The duration of the reduction would depend on the duration of suspended unemployment security. The basic amount would be cut by 20 per cent for the first month and, after that, by 40 per cent. The reduction percentages would remain in line with the current legislation.

Reducing the basic amount of social assistance would be made easier by abolishing the requirement of the two-month time period laid down in the current Act.

Applicants for social assistance could always avoid any reduction in the basic amount and any unemployment benefit sanctions by participating in employment services as required by the relevant legislation.

The basic amount could be reduced in the above-mentioned cases only if this would not endanger the means of support necessary for dignified living and if the reduction could not be considered otherwise unreasonable.

Changes to municipalities’ funding shares and consideration of income in social assistance

The municipalities’ funding share of basic social assistance would be raised from 50 per cent to 100 per cent in respect of those social assistance recipients between the ages of 18 and 24 who do not have family members of other ages living with them. The funding would be reimbursed to the municipalities in full. The purpose of raising the funding share is to encourage the municipalities to employ young people at the earliest possible stage in order to keep the support periods as short as possible.

Social assistance would no longer have the earned income allowance of EUR 150 for people aged 18 or over. In future, other minor income and subsidies would also be taken fully into account as income in respect of those aged 18 or over. However, children’s earned income and gifts that are considered small would not be taken into account as income in the calculation of social assistance.

Changes to social assistance aim to achieve total savings of EUR 74 million – Basic amount for adults to be reduced

The Government Programme sets an objective for the comprehensive reform of social assistance to strengthen general government finances. The proposed changes would strengthen general government finances by EUR 74 million in relation to the current legislation. In 2024, Kela paid a total of about EUR 825 million in basic social assistance.

To achieve the savings target, the level of the basic amount of social assistance would also be cut as follows:

• 3 per cent for people aged 18 or over who live alone 
• 3 per cent for people aged 18 or over who live with their parents 
• about 2 per cent for other people aged 18 or over.

For example, for those aged 18 or over who live alone, the cut would reduce the basic amount of social assistance by EUR 17.80 at the 2025 level. The cuts would apply only to the basic amounts of those aged 18 or over. The basic amount of social assistance for people under the age of 18 would increase slightly (0–0.7 per cent), which would reduce the impact of the changes on families with children.

The Government is not proposing any changes to index increases to the basic amount of social assistance. Instead, benefits will be increased in accordance with the national pension index at the beginning of 2026.

The measures to strengthen the obligations related to social assistance would increase access to primary benefits, which would deliver savings in social assistance costs. Clarifying the legislation related to reducing the basic amount of social assistance is expected to increase situations where the basic amount would be cut. The changes related to the consideration of income would save an estimated EUR 25 million in basic social assistance costs, and cutting the basic amount would save approximately EUR 28 million.

In total, the changes are estimated to increase costs arising from primary benefits by EUR 142 million and reduce social assistance costs by about EUR 188 million. When taking into account the tax impacts, the changes would generate net savings of EUR 74 million in general government finances as mentioned above.

The proposal also includes other specifications to the Social Assistance Act that have been found to be necessary during implementation. These specifications are not expected to have any significant savings impact.

Comments on the comprehensive reform of social assistance can be submitted until 27 June 2025 at 16.15

Most of the proposed acts are scheduled to enter into force on 1 February 2026.

• Lausuntopalvelu.fi (service for online consultation): Government proposal to Parliament for amending the Social Assistance Act, section 64 of the Act on the Processing of Client Data in Healthcare and Social Welfare and section 10 of the Act on Rehabilitative Work (in Finnish)
• Frequently asked questions about the comprehensive reform of the Social Assistance Act (in Finnish)

A discussion event on the comprehensive reform of social assistance will be held for stakeholders on 28 May 2025.

• Stakeholder event: Event for stakeholders on the comprehensive reform of social assistance on Wednesday 28 May at 9.30–11.00

The comprehensive reform of social assistance is part of the social security reform.

• Social security reform

Inquiries

Sakari Rokkanen, Special Adviser to the Minister of Social Security, tel. +358 295 163 560, [email protected]
Liisa Siika-aho, Director General, tel. +358 295 163 085, [email protected]