Finland Sees Progress on $12.1 Billion Plan to Pay for Aging

Finland’s government is making progress with 9 billion euros ($12.1 billion) of measures intended to ensure it has money to pay for the fastest aging population in Europe, according to senior civil servants.

Work on the plan is moving ahead with a tight schedule, Martti Hetemaeki, the top civil servant at the Finance Ministry, and the ministry’s economic policy coordinator Jukka Pekkarinen told reporters in Helsinki today.

After two recessions in four years depleted government coffers and policy makers over the years failed to rein in growing spending on social services, Finland is now working to close a so-called sustainability gap of 4.7 percent of gross domestic product.

The sustainability gap measures the difference between available funds and the amount needed to pay for future public spending. The six-party government agreed on measures on Aug. 30 and details are being hammered out by civil servants before the Cabinet of Prime Minister Jyrki Katainen meets to assess progress on Nov. 29.

“Here the population is aging faster than in other European Union countries, and especially at the start the growth is fierce,” Pekkarinen said. “These are the critical years for bringing the sustainability gap under control.”

To contact the reporter on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net

To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net

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