Finland’s government debt = Additional cost to citizens caused by the work of MPs
- In 1981 it was 3.7 billion euros, EUR 772.48 per inhabitant
- At the end of 2022, it was 141.6 billion euros.
EUR 25,398 per inhabitant and per employee approximately 50,000 euros.
And more to come:
The state budget proposal for 2023 is approximately 81.3 billion euros, which is approximately 16.4 billion euros more than in the actual budget for 2022. The increase is caused especially by the social security reform, as a result of which the level of the state’s budgetary finances will rise by around 14 billion euros on the level of the whole year.
According to the estimate published by the Ministry of Finance on March 1, 2024 the national debt would be 212 billion euros at the end of 2028.
In recent years, the European Central Bank has played a significant role in increasing the amount of debt. It has released about 5,000 billion euros of money made out of nothing into the European financial markets with the government bond purchase program. It enabled low-cost, even zero-interest loans for the countries’ endless need for money.
How we got here
The direction of Finland’s democratic development has been influenced by the three most popular presidents of their time. Urho Kekkonen, Mauno Koivisto and Sauli Niinistö.
Urho Kekkonen was president 1.3.1956 — 27.10.1981. Party background: Maalaisliitto, current Keskusta (Center)
He was an absolute supporter of neutrality, which is why he was also highly respected both in the United States and in Russia. So, he was skilled in foreign policy, but also a strong ruler in Finland. His leadership can be described as almost dictatorial, except without violence. He was so popular among the people that authority and speeches were enough to use power. It has been the reason why politicians have sought to tarnish his reputation since his death. He has been accused of being a Russian sympathizer and of making parliamentarism difficult. However, he was in power for an exceptionally long time, more than 25 years. When he gave up power in October 1981, the debt of the Finnish government was 3.7 billion Euros (less than 10% of the gross domestic product).
Mauno Koivisto was president 27.1.1982–1.3.1994. Party background: SDP (Social Democratic Party).
His most significant achievements must be considered the reduction of the president’s powers and the strengthening of parliamentarism. Finland’s membership application to the European Union was also submitted during Koivisto’s term. In foreign policy, he shifted Finland’s focus towards the west.
When he started as president, the debt of the Finnish state was 3.7 billion euros as a legacy of Kekkonen’s time. When he ended his second term 12 years later in early 1994, the debt was 43 billion Euros (50.2% of the gross national product).
Sauli Niinistö has been president since 1.3.2012 . Party background: Kokoomus (Right-wing party).
His second and at the same time his last presidential term will end in 2024. During his time in power, he has first been increasing NATO cooperation and finally taking Finland towards NATO membership. During the term of office of Sauli Niinistö, Finland’s integration into the European Union has also been deepened.
When he started as president in 2012, Finland’s government debt was 79.7 billion Euros (40.2% of gross domestic product). At the end of 2022, it was 141.6 billion euros. Due to commitments already made, the debt is estimated to be 160 billion at the end of President Niinistö’s term in 2024 (over 60% of the gross domestic product).
(Addition: 10.3.2023 The government’s debt at the end of 2023 was 156.2 billion euros.)
In addition to the influence of the presidents, the annual amount of Finland’s debt has been influenced by the actions of the European Central Bank, the effects of EU legislation, the Bank of Finland and the economic and monetary policy decisions of governments over the decades.
. . . . . . . . . . .
In the table below, the annual development of the government debt has been monitored. The reigns of presidents and governments have been added to it, but also special cases that have had an impact on debt development. So you can conclude for yourself why the almost debt-free Finland is now drowning in debt and citizens in payment difficulties.
Year Government debt Relative to GDP
(million euros)
================================
1955 230 13,7 %
– Urho Kekkonen as president 1.3.1956
1981 3 717 9,8 %
– Kekkonen resigned from the post 27.10.1981
he was president for more than 25 years
1982 5 087 11,9 %
– Mauno Koivisto as president 27.1.1982 –
Sorsa III government 19.2.1982 – 6.5.1983
1983 6 412 13,4 %
– Sorsa IV government 6.5.1983 – 30.4.1987
1984 7 445 13,9 %
1985 7 902 13,6 %
1986 8 745 13,9 %
- The Bank of Finland liberalized the granting of foreign credits
in 1986 – CEO Rolf Kullberg 1983–1992
1987 9 841 14,5 %
– Holkeri government 30.4.1987 – 26.4.1991
- Harri Holkeri’s “controlled structural change” government
started to deregulate the currency
1988 9 769 12,7 %
1989 8 899 10,4 %
1990 9 593 10,5 %
1991 14 204 16,3 %
– Aho government 26.4.1991 – 13.4.1995
- Currency regulation was stopped
1992 27 849 32,8 %
- Full freedom for the movement of capital 1993
1993 43 030 50,2 %
- Finland’s 1990 – 1993 recession was one of the worst economic
crises in Finnish history in terms of its economic effects
1994 51 722 57,0 %
– Martti Ahtisaari as president 1.3.1994
- Finland became a member of the European Union 1.1.1995
1995 60 121 61,0 %
– Lipponen government 13.4.1995 – 15.4.1999
1996 66 121 64,8 %
1997 69 770 63,0 %
1998 69 796 58,0 %
- Finland adopted the European common currency, the Euro 01.01.1999
1999 68 052 53,6 %
– Lipposen II hallitus 15.4.1999 – 17.4.2003
2000 63 435 46,6 %
– Tarja Halonen as president 1.3.2000
2001 61 760 42,8 %
2002 59 253 40,0 %
2003 63 320 41,7 %
– Vanhanen government 17.4.2003 – 19.4.2007
2004 63 788 40,2 %
2005 60 044 36,5 %
– “China’s state treasury 2,500 billion dollars and EU countries
at least as much debt.”
2006 58 904 34,1 %
2007 56 068 30,0 %
– Vanhanen II government 19.4.2007 – 22.6.2010
2008 54 382 28,0 %
2009 64 281 35,4 %
2010 75 152 39,9 %
– Kiviniemi government 22.6.2010 – 22.6.2011
2011 79 661 40,2 %
– Katainen government 22.6.2011 – 24.6.2014
2012 83 910 41,7 %
– Sauli Niinistö as president 1.3.2012
- European Central Bank – consolidated balance sheet of the
Eurosystem 3,020 billion euros (March 2012)
2013 89 738 43,9 %
2014 95 129 46,0 %
– Stubb government 24.6.2014 – 29.5.2015
2015 99 807 47,2 %
– Sipilä government 29.5.2015 – 6.6.2019
2016 102 352 47,0 %
2017 105 773 46,7 %
- European Central Bank – consolidated balance sheet of the
Eurosystem at the end of 2017 was 4,468 billion euros
2018 104 973 45,0 %
2019 106 368 44,3 %
– Rinne government 6.6.2019 – 10.12.2019
– Marin government 10.12.2019 –
2020 124 833 52,5 %
- Consolidated balance sheet of the European Central Bank
Eurosystem at the end of 2020 was 6,978 billion euros
2021 128 696 51,2 %
2022 141 628 51,6%
- Consolidated balance sheet of the European Central Bank
Eurosystem at the end of 2021 was 8,566 billion euros
Orpo government 20.6.2023 –
2023 156.2 billion euros
Alexander Stubb as president 1.3.2024 –
Sources:
Valtiokonttori (Treasury)
Valtioneuvosto (State Council)
European Central Bank
18.12.2022 (Updated 10.3.2024)
Reijo Lahdenperä
European Central Bank ECB
At the end of 2021, the consolidated balance sheet of the Eurosystem was EUR 8,566 billion (EUR 6,978 billion in 2020). The consolidated balance sheet consists of the external assets and liabilities of the national central banks of the euro area and the ECB. The balance sheet was increased from the previous year mainly by the securities purchases made in the PEPP and APP programs and the increase in the Eurosystem’s financing operations through the third series of targeted longer-term financing operations (TLTRO III).
The Eurosystem held EUR 4,713 billion in securities purchased for monetary policy reasons, which is EUR 1,019 billion more than the previous year (EUR 3,694 billion). Securities acquired in the APP program amounted to EUR 3,123 billion (EUR 214 billion more than the previous year) and securities acquired in the PEPP program amounted to EUR 1,581 billion (EUR 827 billion more than the previous year).
Ministers’ largest debt balances (February 2022)
– Prime minister Sanna Marin (sdp) 719 000 €
– Climate and Environment Minister Maria Ohisalo (green) 636 000 €
– Foreign minister Pekka Haavisto (green) 560 000 €
– Minister of Finance Annika Saarikko (center) 533 500 €
– Minister of Justice Anna-Maja Henriksson (rkp) 342 000 €
– Minister of Family and Basic Services Krista Kiuru (sdp) 228 000 €
– Minister of Education Li Andersson (left wing) 213 000 €
– Minister of Municipal Affairs Sirpa Paatero (sdp) 203 000 €
