Budget for 2024 in Parliament: Strong investments in growth in the administrative branch of the Ministry of Economic Affairs and Employment 

On 9 October 2023, the Government submitted its budget proposal for 2024 to Parliament. Parliament held a referral debate on the appropriations proposed for the administrative branch of the Ministry of Economic Affairs and Employment on 11 October 2023.

The Government proposes a total of EUR 4.2 billion in appropriations for the administrative branch of the Ministry of Economic Affairs and Employment. This is EUR 306 million more than in the 2023 Budget.

Employment and entrepreneurship

For 2024, EUR 994 million is proposed in appropriations for employment and entrepreneurship, which is EUR 9 million more than in the 2023 Budget.

A total of EUR 184 million is proposed for public employment and business services appropriations. This is EUR 37 million less than in the 2023 Budget. The decrease is due to the reduction in employment appropriations and the discontinuation of business development services, as outlined in the Government Programme.

“The Government aims to target resources to better service those unemployed people who have a longer path to the labour market. From autumn 2024, unemployment funds will be able to offer employment services, and at the same time the service process for jobseekers will be reformed,” says Minister of Employment Arto Satonen.

The responsibility for organising employment and economic development services (TE services) will be transferred to municipalities on 1 January 2025. Municipalities will be compensated for the costs arising from the transfer. An increase of EUR 34 million is proposed for these costs.

The Ministry of Economic Affairs and Employment will continue the measures to extend working careers. An appropriation of EUR 61.7 million is proposed for transition security training, employment subsidy for persons aged 55 or over, and subsidies paid to municipalities for their obligation to provide employment to certain unemployed jobseekers. 

As stated in the Government Programme, the discretionary government grant to Työkanava Oy will be halved to EUR 5 million, and the capital investment in Työkanava Oy will not continue after this year. In accordance with the Government Programme, funding for Talent Hub activities will be terminated, which will cause a reduction of EUR 1 million from the 2023 Budget.

Research, development and innovation policy

The Government’s objective is to increase Finland’s research and development expenditure from the current level of slightly under three per cent to 4 per cent of GDP by 2030.  In line with this target and the current Act on Research and Development Funding, the Government will raise central government funding for R&D activities to 1.2 per cent of GDP by 2030, provided that private sector investments cover two-thirds of R&D expenditure.

It is proposed that the budget authority for supporting research, development and innovation activities be increased to EUR 529 million, which includes an increase of EUR 92 million in the budget authority for R&D funding in 2024. The budget authority will be primarily targeted at companies committed to increasing investments in higher-risk and more ambitious R&D activities that support the clean and digital transition or solve other challenges in society. 

In addition, a part of the budget authority will be allocated for applied research in research organisations that develop disruptive technologies together with companies. An appropriation of EUR 35 million is proposed for national co-financing of EU projects for higher education institutions and government research organisations. The funding will encourage higher education institutions and research organisations to participate more extensively in EU projects.

“Historically large public investments in RDI will create a favourable environment for new growth and wellbeing in Finland. Finland will succeed in international competition when we do things better than our competitors. We will create preconditions for this through our strong investments in R&D,” says Minister of Economic Affairs Wille Rydman.

In addition, EUR 211 million is proposed in appropriations for special funding of enterprises, which is EUR 8 million less than in the 2023 Budget.

Regeneration and carbon reduction

An appropriation of EUR 1.6 billion is proposed for regeneration and carbon reduction, which is EUR 182 million more than in the actual 2023 Budget. The growth in the appropriations is driven in particular by the change in the estimate of the production subsidy for renewable energy.

EUR 54.5 million will be added to the energy aid budget authority for clean transition investments as part of the REPowerEU chapter of Finland’s Recovery and Resilience Plan. On the other hand, the national budget authority under the item will be reduced by EUR 14.1 million in accordance with the Government Programme.

A budget authority of EUR 10 million is proposed for promoting the charging and refuelling infrastructure for public transport electricity and gas to promote a clean transition away from fossil fuels.

Integration and international expertise

For 2024, EUR 389 million is proposed in appropriations for integration and international expertise, which is EUR 95 million more than in the 2023 Budget.

Meanwhile, EUR 384 million is proposed to central government compensation for the promotion of integration – an increase of EUR 97 million compared to the 2023 Budget. The needed appropriations will grow by EUR 110 million due to the beneficiaries of temporary protection who have been granted a municipality of residence. The decrease in the annual refugee quota to 500 persons outlined in the Government Programme will reduce the need for appropriations by EUR 2 million.

Inquiries:
Jukka Sarhimaa, Special Adviser to Minister of Employment Arto Satonen, tel. +358 295 047 330
Lassi Noponen, Special Adviser to Minister of Economic Affairs Wille Rydman, tel. +358 50 407 6033 
Lyydia Ylönen, Special Adviser to Minister of Climate and the Environment Kai Mykkänen (who is responsible for energy matters), tel. +358 50 476 1341 
Maria Paaso, Special Adviser to Minister of the Interior Mari Rantanen (who is responsible for integration matters), tel. +358 295 160 046 
Jukka Nummikoski, Director of Finance, Ministry of Economic Affairs and Employment, tel. +358 295 047 333