The Social Democratic party’s Antti Rinne could be next prime minister
Finland is tipped to turn left in Sunday’s election, with the Social Democrats leading in polls.But with several parties, including the right-wing Finns, jostling closely for second place, their ability to govern could be curtailed and coalition-building lies ahead.How did we get here?Last month, former Prime Minister Juha Sipila’s government resigned over its failure to achieve a key policy goal on social welfare and healthcare reform. His Centre Party had been in a centre-right coalition government since the last parliamentary elections in 2015.Concerned about Finland’s expensive welfare system in the face of an ageing population, Mr Sipila made tackling the nation’s debt one of his government’s main aims, introducing planning reforms he hoped would save up to €3bn (£2.6bn) over a decade.More about Finland’s welfare experiment:
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Media captionFinland’s basic income trial
But while the introduction of austerity measures – such as benefits cuts and pension freezes – resulted in Finland reducing its government debt for the first time in a decade last year, the reforms proved politically controversial.Meanwhile, the Social Democratic Party, a centre-left party with strong links to Finland’s trade unions, saw its popularity grow.Why has this happened now? Polls ahead of Sunday’s vote showed the Social Democrats, who campaigned on a pledge to strengthen Finland’s welfare system, leading by several percentage points. The party had been in front for almost a year. The party’s leader, Antti Rinne, earlier described Mr Sipila’s policies as unfair, and said taxes needed to be raised to combat inequality. “We need to spread our tax base and we need to strengthen it,” Mr Rinne recently told Reuters news agency, adding that the move would mark a “big policy change” for Finland.One of Mr Rinne’s election pledges was to raise the state pension for those taking home €1,400 a month by €100, a move he said would help “more than 55,000 pensioners escape poverty”.
Finland’s ageing population is putting pressure on its social welfare systems
Balancing taxes and spending is problematic for any government, and Finland’s personal income tax rate – at 51.6% – is among the highest in Europe. Finland’s recorded “tax wedge” – the difference between a worker’s take home pay and what it costs the employer – has been larger than the average among top industrialised countries in recent years, according to the Organisation for Economic Co-operation and Development (OECD). However, a poll commissioned by the tax authority in 2017 found that 79% of Finns questioned were happy with their taxes.Why is Finland’s welfare system an issue?Like many developed nations, Finland has an ageing population that is putting financial pressure on its social welfare systems. As an increasing number of people live longer in retirement, the cost of providing pension and healthcare benefits can rise. Those increased costs are paid for by taxes collected from of the working-age population – who make up a smaller percentage of the population than in decades past.In 2018, those aged 65 or over made up 21.4% of Finland’s population, the joint fourth highest in Europe alongside Germany — with only Portugal, Greece, and Italy having a higher proportion, according to Eurostat.Finland’s welfare system is also generous in its provisions, making it relatively expensive. Attempts at reform have plagued Finnish governments for years.In February this year, caring for the nation’s elderly returned to the top of the political agenda amid reports that alleged neglect in care homes may have resulted in injury or death, according to Finnish state broadcaster YLE.
€20m Cost to government
8.1% Unemployment rate
5,503,347 Finnish population
How is the vote likely to pan out?Voting runs from 09:00 local time (06:00 GMT) until 20:00, with first results due shortly after.The Social Democrats are widely tipped to become largest party, but under Finland’s proportional representation system, they may have to form a coalition with several other parties.While the Finns Party has seen its support grow, many other parties do not want to work with them.