Government Savings through Subsidy Rationalisation
In an interview with YLE in August, Elias Erämaja, the chief economist at Suomen Ekonomit, highlighted the potential for substantial cost savings by streamlining business subsidies under Prime Minister Petteri Orpo’s administration. Erämaja identified approximately 500 million euros in subsidies that often benefit large corporations or are driven by regional political interests.
Key reductions were achieved in electrification subsidies for energy-intensive industries, labour cost reimbursements in the marine sector, and fuel subsidies for transport and work machine companies – much to the benefit of industry giants like Stora Enso and UPM. Erämaja emphasized the need to eliminate subsidies that distort market competition and skew investment priorities.
Furthermore, there is a growing push to redirect subsidies towards innovative projects that address societal needs and technological advancement. While criticism of the subsidy system persists, business owners and experts alike are advocating for a more efficient and equitable allocation of resources.
With ongoing debates on the effectiveness and fairness of business subsidies, it remains to be seen how the Finnish government will address these calls for reform while balancing economic interests.