NGOs receiving employment funds suspected of neglecting tax obligations
Helsinki reports problems with immigrants’ associations
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A number of non-governmental organisations receiving financial support from employment funds are suspected of neglecting taxation obligations in Helsinki.
The Uusimaa Employment and Economic Development Centre (T&E-Centre) is currently looking into the cases of more than 20 associations suspected of such negligence.
The Helsinki Employment Office is investigating all associations to see if they have paid their mandatory employers’ contributions.
The City of Helsinki has stopped payment the so-called Helsinki supplement to 11 immigrants’ associations because of non-payment of employers’ contributions.
The Helsinki supplement is available to associations or foundations which hire a long-term unemployed Helsinki resident.
According to Eija Hanni of the Helsinki City Personnel Centre, most of the 11 associations have a Somali background.
"The investigation began when I started asking tax authorities about associations that are carrying out EU projects", says Kaija Kattelus-Sørlie of the Uusimaa T&E Centre.
The investigation is still going on. Kattelus-Sørlie says that there could be more to investigate in the matter, and that officials granting financial aid to associations have not always adequately supervised the use of the money.
Officials suspect that the fiscal improprieties may involve the same people systematically operating in several different organisations, taking advantage of the limited resources of officials to supervise the activities.
Officials responsible for distributing subsidies are placing associations under closer scrutiny. Tax authorities also plan to launch a project at the beginning of next year to keep a closer watch on the activities of associations and foundations.
The investigation was launched when financial irregularities were reported in connection with an EU project in one association, Immigrants Support in Finland.
Immigrants Support in Finland was set up in 1994, and has operated with the help of personnel, whose salaries have been partially paid through employment subsidies.
The Uusimaa T&E Centre granted the association EUR 300,000 last year for a project called "Synergy Bridge", aimed at promoting communication between immigrants and employers.
However, the payments were suspended in late August after just EUR 27,000 was paid out. The reason for the stop in payment were questions about the association’s bookkeeping, as well as in-fighting within the organisation, and problems between the association and its partners.
Kaija Kattelus-Sørlie attributes the problems mainly to a lack of skill in handling the finances. "It is unfortunate that the project had to be suspended, because there would have been a need for it.
The City of Helsinki has helped finance Immigrants Support in Finland, paying out about EUR 120,000 in employment funds since 1999.
Helsinki stopped paying the subsidies in the autumn because of the financial questions and unpaid employers’ contributions.
Ali Qassim, who was recently re-elected as the association’s chairman, says that the Synergy Bridge project has caused some problems. "We have received municipal and state support for ten years. We have handled it with professional skill and tried to do our best. There have never been any problems."
The association received EUR 320,000 in aid from the state-owned Finnish Slot Machine Association (RAY) between 1998 and 2002. Problems with the handling of the money led to a cancellation of the grant as of 2003.
In 2002-2003 the Ministry for foreign Affairs granted Immigrants Support more than EUR 177,000 for projects in Somalia and the Philippines. The ministry says that internal disagreements arose within the organisation, as well as financial problems linked with certain key figures. The NGO unit of the Foreign Ministry now plans to examine the activities of the association more closely.
Helsingin Sanomat
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| 19.12.2005 - TODAY |
 NGOs receiving employment funds suspected of neglecting tax obligations
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