Minister of Economic Affairs Lintilä: Supplementary budget’s investments in industrial policy to help companies rise from the coronavirus crisis
The third draft supplementary budget for 2021 will accelerate growth, bring forward investments and respond to the needs caused by the coronavirus pandemic. The supplementary budget will also launch reforms and investments under the EU’s recovery and resilience facility.
“While the outlook for the economy and investments is promising, it does not dispel the fact that far too many Finnish entrepreneurs and their employees have had to bear an unreasonable burden because of the coronavirus pandemic. Understandably, their trust in the future has been tested. That is why we made important decisions to secure growth, employment and jobs in Finland in the third supplementary budget,” says Minister of Economic Affairs Mika Lintilä.
Fourth application round for business cost support to prop up sectors most hurt by the pandemic
Preparations for the fourth application round of business cost support are ongoing. The supplementary budget will include additional funding of EUR 200 million for business cost support. Of the total, nearly EUR 170 million will come from unused appropriation for the support of sole entrepreneurs, which will be re-budgeted for business cost support.
The objective of business cost support is to help companies cope with the difficult economic situation caused by the pandemic. The support is compensation for the company’s payroll costs and fixed costs that are difficult to adjust, but it does not compensate for a fall in turnover.
Additional investments to support the battery value chain
The aim is that the battery sector employs and generates growth in different parts of Finland.
An additional EUR 40 million will be allocated to the battery sector through Business Finland. The funding will promote pilot and demonstration projects that support Finland’s national objectives on the battery sector as well as production-related investments in the circular economy and sustainable green growth.
Government prepares for Finnvera’s risk of loss
It is proposed that EUR 650 million be transferred to the State Guarantee Fund. In this way, the Government prepares for a situation where the funds remaining in the State Guarantee Fund may not be sufficient to cover the unprofitable separate result of Finnvera’s export guarantee and special guarantee operations. This will strengthen the operating conditions of the maritime industry that employs thousands of people directly and through a large number of subcontractors in Finland.
Increase to innovation support for shipbuilding
An increase of EUR 19.4 million is proposed to innovation support for shipbuilding, which enables new projects and a raise of the maximum amount of innovation support from EUR 10 million to EUR 15 million.
Support to peat entrepreneurs and employees
The draft supplementary budget includes an allocation totalling EUR 60 million to support peat industry operators and employees.
“The agreed package for the peat industry means that as many people as possible who receive a livelihood from peat could adapt to the rapid structural change in a fair manner,” Lintilä says.
The funding will consist of:
- EUR 20 million in appropriation for scrapping or removal of machinery and equipment of peat companies.
- EUR 3 million to support new business development.
- EUR 1.5 million to measures related to re-employment and training.
- EUR 1.5 million to support afforestation.
- EUR 30.585 million for subsidies to peat entrepreneurs as well as other adjustment allowances.
- EUR 4 million to support reforestation.
- EUR 0.75 million for the study on other uses of peat production areas.
- EUR 0.165 million to TE Offices and ELY Centres for allocation of resources on support measures.
Support to rail transport
As part of the Sustainable Tourism 2030 programme, the Ministry of Transport and Communications will improve the service level of night-time rail services in accordance with a purchase agreement for passenger rail services for a maximum of nine years, which will be negotiated with VR Group. The draft supplementary budget includes an authorisation of EUR 40 million for procurement of rolling stock for a night train.
Support for vaccine development
The implementation of the growth strategy for the health sector and vaccine development will be supported by increasing Business Finland’s grants by EUR 6 million for this purpose.
The draft supplementary budget was submitted to Parliament on Thursday 27 May and is available on budjetti.vm.fi
Antti Siika-aho, Special Adviser to the Minister of Economic Affairs, tel. +358 50 575 4118
Teppo Säkkinen, Special Adviser to the Minister of Economic Affairs, tel. +358 50 516 2868 (esp. support to peat industry)
Director Mika Niemelä, Ministry of Economic Affairs and Employment, tel. +358 29 506 2135