Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure FI-2023-1/2863 – Updated – measures in Finland
|Country||Finland , applies nationwide|
|Time period||Temporary, 01 January 2023 – 31 December 2023|
|Context||War in Ukraine|
|Type||Other initiatives or policies|
Responses to inflation
– Support for energy bills
|Author||Amanda Kinnunen and Elina Härmä (Oxford Research)|
|Measure added||13 September 2022 (updated 11 July 2023)|
Russia's invasion of Ukraine has affected Europe's energy supply and energy prices. The government of Finland stated in the most recent negotiations for budget amendments that it is unlikely that prices will return to their pre-war levels in the near future. Thus, the government introduced a measure to assist citizens with the high energy prices. In addition to the reduction in the value added tax on energy , the measure introduces a four-month temporary electricity allowance.
The government of Finland announced a plan to introduce a four-month temporary allowance for citizens to help pay their energy costs. The details of the measure are still to be determined and the government has not elaborated on how the measure will work in practice. Preliminary models suggests that the allowance will be paid for electricity bills exceeding either €300 or €500 and up to a maximum of either €1,300 or €1,500.
The electricity allowance is aimed at people who do not pay enough tax to qualify for a household energy tax deduction . The government earmarked €300 million for the allowance and the tax deduction each. People who receive subsistence benefit (toimeentulotuki) are not eligible for the allowance.
The allowance would be available from January to April, 2023 and will be paid out by the Social Insurance Institution of Finland (Kela).
Over 100,000 citizens are expected to be eligible for the allowance.
|Does not apply to workers||Does not apply to businesses||
People on low incomes
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Not applicable||Not applicable|
Social partners' role in the implementation, monitoring and assessment phase:
The measure is not in social partners' domain.
The leader of the Central Organisation of Finnish Trade Unions (SAK) underlines that it is important that there is a political response to the record high electricity bills. He states that support should be targeted to low-income earners and those hardest hit by the price hike. The Finnish Confederation of Industries (EK) commented on the government’s budget stating that they understand the spending increases in exceptional circumstances. However, they remain critical to the increasing fiscal debt.
Eurofound (2022), Temporary electricity allowance for low income households, measure FI-2023-1/2863 (measures in Finland), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/FI-2023-1_2863.html
30 January 2023
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12 September 2022
Although the worldwide pandemic situation had already disrupted supply chains and triggered increases in energy and food prices in 2021, the situation deteriorated in 2022 with the Russian invasion of Ukraine.Article
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This article summarises the first policy responses that governments across the EU have started to implement to support companies affected by the rising prices, and those with commercial ties to Ukraine, Russia or Belarus.Article
Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.