The last welfare budget
PERSPECTIVE
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By Ilkka Ahtiainen
Greetings from paternity leave, that 18-day benefit that is granted by the Nordic welfare state and that actually does not need to be enjoyed completely without wage income!
While changing the diapers of my baby son with drooping eyelids, I had time to ponder the essential facts of life, like the state budget for next year.
It is an immense propaganda success for the current Centre-Social Democrat government, as it leaves hardly anyone without some gain.
Families will receive more financial support to take care of their children at home, those with plenty of disposable income will be able to make larger tax deductions if they hire help around the house, pensioners will see hikes to their income, and war veterans have been allocated more funds for physical therapy and food. Income taxes are also set to fall, as long as the labour market organisations first agree on raises that are sufficiently small.
This is a tough bite to chew on for the parties in the opposition. They do not really have any other alternatives in Parliament than to tell the voters that they would have given them even more, or perhaps they could compare the accomplishments of the cabinet parties to their promises during their election campaigns. These promises naturally lacked a responsible consideration about state finances.
For the country's 400,000 unemployed people the budget is relatively harsh, as the daily value of basic unemployment allowance will be raised by a meagre nine cents, in line with the developments in an index.
But as politicians well know, there are many people among the unemployed who never wind up voting.
The generosity of the budget stems not only from the government's official programme that is now being implemented, but also from temporary needs, or the coming municipal elections.
But the current distribution policy is not irresponsible - Finland is now doing quite well.
Through the 2005 budget, the government has nevertheless made all its most significant decisions that will distribute new income to various segments of the population. If the current policy is adhered to, no increases to state transfer payments are in sight in 2006 and in the next Parliamentary election year 2007.
At the same time, the Ministry of Finance has begun to steer public discussions in an entirely new direction. The new economic report for the years 2006-2008 did not promise much. However, the calculations lacked the stimulatory effect on economic growth of possible income tax cuts.
Permanent Secretary Raimo Sailas from the ministry raised the issue of a subjective right to day-care services, an example of the luxury services a welfare state provides.
It would seem that Sailas was attempting to initiate a discussion not on the right to day-care as such, but on what Finland can afford in the future. The ensuing discussion, which has already waned, showed how dangerous political decisions on welfare services can be. Achieved benefits cannot be cut!
If the forecasts of a relatively weak economic growth rate in the near future turn out to be accurate, the budget talks in Parliament during the next electoral term will be held in an entirely different spirit from that which is prevalent now. What will be cut and from whom?
The 2005 budget may turn out to be the last welfare budget in a long, long time, so it is high time to enjoy the luxury services of a welfare society.
At least that is what we do. The older sister spends three days a week in day-care while the mother takes care of the baby at home with the taxpayers' money, and the father works in order to earn that money.
Helsingin Sanomat / First published in print 18.9.2004
ILKKA AHTIAINEN / Helsingin Sanomat
ilkka.ahtiainen@hs.fi
