The new Finnish right-wing Government’s austerity measures are designed to make life more difficult, in particular, for those who have become unemployed or being laid off temporarily. According to the Industrial Union research unit, people who find themselves in this predicament may lose thousands of euros a year.
To understand what these austerity measures mean, in real terms, the Union research unit calculated how the cuts would affect five different families. The fictional families are created to correspond to various typical real life situations.
For a majority of these families, the austerity measures would mean a weakening of their purchasing power, which could amount to hundreds of euros a month. Two families benefit from the tax cuts planned.
Especially hard hit are those entitled to earnings-related unemployment benefits. Under the new legislation the benefit would begin go down after two months. Another group to suffer, in particular, are those living alone in the countryside or in the small communities where it is difficult to find a new job within a decent distance.
The Government measures benefit most those who enjoy a stable situation and moderate expenses.
– So, the most vulnerable are the ones who are set to lose the most by the Government cuts. This means that even the smallest change in income or expenses might make the whole economy tilt, says Anu-Hanna Anttila, the chief of the Union research unit.
– In particular, families with only one breadwinner face the greatest risk and, in turn, this will affect the economy as a whole. These are single person families, single parents and families where one of the adults is unemployed or laid off temporarily.
As regards unemployment or temporary lay-offs, the cuts make a quick negative impact. People will need to seek basic social assistance.
– The Government measures benefit most those who enjoy a stable situation and moderate expenses. This means families with two salary earners with enough income, grown-up children and low housing expenses, Anttila says.
Warning! Cuts ahead!
The Orpo-Purra Government plans to cut 1.5 billion euros from social security.
Soste, the umbrella organisation of the Finnish social affairs and health NGO’s, calculated what does it mean in practise. The number of poor people will grow 9.2 per cent and children in poverty 13.2 per cent. Finland will get 68,000 new poor people.
These concerns were heard, in a way. For 2024, Soste state aid will be cut with 60 per cent.
What are the planned Government social security cuts? Here are some examples.
Finland will get 68,000 new poor people.
Child supplements of 150–285 euro abolished in unemployment benefit. Earnings-related unemployment benefit reduced with 20 percent after two months. Plus five per cent more after eight months. Waiting period for unemployment benefit prolonged from 5 to 7 days.
Required employment for earnings-related benefit doubled from a half year to one year. Wage-subsidised employment no longer counted as the employment condition for earnings-related benefit.
Deep cuts in housing allowance. Unemployment benefit to begin only after outstanding holiday compensation.
Abolition of adult education benefit and job alternation leave. Cuts in benefits for unemployed elderly workers.