Its report will form the basis of legislative amendments that are expected to come into effect no earlier than in 2026. Liisa Siika-aho, the head of the task force set up under the Ministry of Social Affairs and Health, reminded yesterday that the proposals forwarded by the group of ministry officials and outside experts have yet been discussed by the government and may thus be revised.

Social assistance is a last-resort form of financial aid that was paid to 387,000 people in 2023, a number that equals roughly seven per cent of the population, with the total costs rising to 778 million euros. The basic amount of the aid is currently 593 euros a month for single-person households.

The task force is urging the government to take greater advantage of the existing possibly to slash the aid by 20 or 40 per cent on grounds of rules violations: if, for example, the recipient has been issued a labour policy statement denying them unemployment security for a fixed time period, the social assistance should be cut by 20 per cent for the first month and 40 per cent for subsequent months to generate savings of 17 million euros.

The cuts could be made in circumstances where the applicant has neglected their obligation to apply for work, refused a service needs assessment or failed to participate in rehabilitative work activity.

The task force is proposing that social assistance be slashed by 50 per cent for applicants who have neglected their obligation to first apply for a primary social security benefit or failed to heed requests to register as a job seeker looking for full-time employment.

Also in future the cuts could be made only if they do not compromise the livelihood required to lead a dignified life and they cannot be regarded as disproportionate.

The task force also floated the idea of reducing the basic amount of social assistance by one per cent across the board to generate savings of 12 million euros. Siika-aho on Wednesday argued that the cut is justified because the basic amount has continued to creep up this electoral term while the index-based increases in basic social security benefits have been frozen.

“The levels of basic social security and last-resort security are becoming very close to each other, which can be considered a problem of sorts from the perspective of the incentive effect,” she explained.

Another 20 million euros in savings could be created by scrapping the so-called earned income deduction, which has enabled social assistance recipients to earn 150 euros a month without affecting their social assistance payments. The government has already done away with such mechanisms for housing and unemployment benefits.

“The deduction hasn’t had a particular impact on employment, meaning it hasn’t encouraged people to work the way that was originally projected,” said Siika-aho.

The task force would additionally obligate all social assistance recipients to first apply for priority benefits, such as disability, student or unemployment benefits. The obligation, it acknowledged, would generate no cost savings as the consequent rise in unemployment security expenditure would more than offset the drop in social assistance expenditure.

“You can think of this as the price you’re ready to pay for increasing obligations,” told Siika-aho.

The objective is to move people from social assistance, which has been criticised for making recipients passive, to other social security benefits and possibly to full-time employment.

Siika-aho admitted that the measures proposed by the task force will not necessarily suffice to meet the government-set target of halving the number of social assistance recipients.

“It’s a very difficult target [to reach] in the short term,” she said. “But our thinking is that in the long term encouraging people to work and increasing obligations can have an impact on the number of social assistance recipients. But how long it’ll take and whether the recipient number will halve, that I can’t answer yet.”

The proposals made by the task force were met with alarm by opposition lawmakers.

“The right-wing government’s social assistance reform will lead to longer bread lines and a rise in evictions,” predicted Aino-Kaisa Pekonen, the chairperson of the Left Alliance Parliamentary Group.

Tuula Haatainen (SDP) told Helsingin Sanomat on Wednesday that the proposals look “very bad” especially in the current employment situation, adding that scrapping the earned-income deduction will deprive people of their last chance to improve their livelihood. She also predicted that a reform that places emphasis on cuts will eventually result in an up-tick in spending.

“This would increase inequalities and uncertainty, and consequently evictions, substance abuse and mental health problems in what is already a difficult situation in many people’s lives,” she cautioned.

Aleksi Teivainen – HT