The government will increase defense spending in a new budget agreement

The government will increase defense spending in a new budget agreement

The Finnish government has completed negotiations on the country’s budgetary framework ahead of schedule. Ministers on Tuesday announced a three-year spending plan starting in 2023.

Negotiations were originally scheduled to last two days, with last spring’s session being extended to nine days.

The finance minister spoke to the media on Tuesday Annikka Saarikko (Cen) said that the priorities for this year’s budget framework negotiations were to achieve three types of sustainability: social, natural and economic sustainability.

The current draft budget includes a spending cut of EUR 370 million. The largest spending cuts will be made on projects in the transport sector.

The impact of the Ukrainian war

Before the talks, Prime Minister Sanna Marin (SDP) said the war in Ukraine added significant upward pressure on the state budget.

According to Saarikko, although the effects of the Covid-19 crisis on the Finnish economy were temporary, the effects of the war in Ukraine are not. Due to the Russian invasion of Ukraine, there are arrangements in this year’s state budget to cover emergency costs in the event of an attack.

Minister of Justice Anna-Maja Henriksson (Swe) also said the government has set aside around € 780 million for Ukrainian refugees.

In addition, the state reimburses the costs of refugees retrospectively to the municipalities.

More money for defense, border security

The prime minister said the government has decided to increase funding for defense and border and cyber security.

The government will increase defense spending by EUR 200 million to the spring supplementary budget.

According to Saarikko, the Finnish Defense Forces will receive an additional EUR 130-200 million for military operations in the next few years.

Over the next four years, the government has allocated a total of € 2 billion to defense investment, of which € 1,740 million is for military equipment.

Approximately EUR 160 million has been set aside for the acquisition of surveillance aircraft for border security.

The government also intends to increase investment in science and research, focusing in particular on increasing Finland’s energy self-sufficiency and accelerating the transition to green energy.

Source: The Nordic Page

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