HELSINKI (Chatnewstv.com) — Finland’s government submitted its 2026 draft budget to the European Union on Thursday, a plan that reveals an underlying deficit of €11 billion ($11.7 billion) to be covered by new debt, even as the country aims to rein in its finances.
The proposal outlines central government spending of €90.3 billion against revenues of €81.6 billion. While the official deficit is listed as €8.7 billion, the Ministry of Finance noted this figure is artificially reduced by a one-time accounting measure involving the dissolution of the National Housing Fund.
Without that non-recurring item, “the deficit would be EUR 11.0 billion, which will be covered by taking out more debt,” the ministry said in a statement.
The submission is a required part of the EU’s annual economic surveillance for euro area countries. It comes after the EU Council granted Finland an “escape clause” in July, allowing it to deviate from a previously agreed spending path from 2025 to 2028. According to the ministry, “This decision was based on increasing defence spending.”
Finland’s government has stated that stabilizing the national debt is one of its most important fiscal policy goals. The budget proposal is part of a broader plan that includes previously announced measures intended to strengthen public finances by approximately €9 billion by 2027. The government has also decided on an additional €1 billion in adjustments to take effect mostly in 2027.
The European Commission will now assess Finland’s budget plan and is expected to publish its opinion in November. Finance ministers from the euro area will then issue a collective statement on the budgetary plans in December.
