The Treasury minister Annika Saarikko (Cen) told Yle that he does not support changes to the Finnish public sector loan system, for example, to finance climate investments that could make the state take on more debt.
Last week, Prime Minister Sanna Marin (SDP) said it wanted to rethink the country’s attitude towards debt, in particular by funding the so-called green transition to combat climate change.
However, Saarikko said in an interview with Yle on Wednesday that it would be difficult to determine the necessary investments. In practice, he added that each party could propose to shift a wide range of costs and investments outside the framework, which in turn would increase spending and increase the country’s debt.
In Finland, each government has traditionally set a spending limit at the beginning of its four-year term, but the current government has had to break its own limits due to the coronavirus crisis.
"It would be a slippery slope that could lead to a broader definition of what green debt means," Saarikko said and mentioned as an example that funding for measures to combat the exclusion of young people could also be justified as an investment in the future outside the agreed framework.
"Could we trust each other that there would be no temptation to define new projects as investments," he asked.
Speaking at climate debate Prime Minister Marin, organized by Helsingin Sanomat last week, suggested that investments in projects aimed at combating climate change could be excluded from the framework procedure.
"I would like to break Finland’s own framework. Even if expenditure were outside the framework, it would require the incurrence of debt," Saarikko said and added that shifting spending outside the framework would lead to a "hole" system or leakage framework and therefore the need to take on more debt.
"I’m not particularly excited about the idea of making my own frame system full of holes," the minister added.
Source: The Nordic Page
