2022
National defence budget to be increased significantly
In its spending limits discussion concerning the General Government Fiscal Plan 2023–2026 that ended on 5 April 2022, the Government decided to increase the defence budget by a total of approximately EUR 2.2 billion. This means an increase of approximately EUR 788 million in the Defence Forces budget in 2023 and annual increases of about EUR 408–536 million between 2024 and 2026.
With regard to the Defence Forces, the Government cancelled the EUR 35 million spending limits cut agreed upon in the spring 2021 spending limits discussion, concerning both operations and materiel procurement. In addition, when preparing the second supplementary budget for the spring, the Government will further raise the defence budget for 2022 by approximately EUR 700 million. Specifications will still be made on what will be included in these additional resource needs. They will be incorporated in the supplementary budget proposal under preparation, to be submitted to Parliament by the Government in May.
“The war in Europe has fundamentally changed our security
environment. Therefore, we have decided to make major additional investments in
the Defence Forces. The aim is to safeguard our defence capability under any
circumstances,” says Minister of Defence Antti
Kaikkonen.
The security situation in Europe is the most serious in decades, Russia having
launched an attack on Ukraine on 24 February 2022. The tensions are also
reflected in Northern Europe, and Russia's invasion will have long-lasting
impacts on Finland's security environment. The change in the military operating
environment requires an immediate and permanent increase in the level of
defence budget. The security situation will continue to be tense and difficult
to anticipate.
Strengthening the defence capability means, among other things, improving the reliability of the materiel already in use by the Defence Forces, procuring materiel and ammunition, increasing the volume of refresher training and increasing the number of personnel. This requires giving additional resources for defence without delay, both in the short term and in the medium term.
Level of activity and personnel
In the budget planning period 2023–2026, an annual general increase of EUR 129-201 million will be allocated to the operating expenditure of the Defence Forces, targeted at the following areas:
- The number of personnel in the Defence Forces will be increased by 500 person-years in accordance with the Government's Defence Report (Finnish Government 2021:78) over the next few years. The increase in staffing will concern both civilian and military personnel and will begin in 2022.
- The number of contractual military personnel will be increased by approximately 180–230 person-years from the current 350 person-years
- The volume of refresher training will be increased annually by about 10,000 reservists from the current 19,300 reservists
- Access to resources needed for maintaining the level of daily operations of the Defence Forces will be secured (e.g., monitoring and safeguarding territorial integrity, exercises and fuels)
- The level of materiel maintenance will be raised
- The real estate expenditure, including the effect of energy prices,
will increase due to preparedness requirements.
Defence materiel procurement
The Government decided that an increase of about EUR 1.5 billion will be allocated to defence materiel procurement for the budget planning period 2023–2026 to boost national defence capability. Included in the spring supplementary budget under the title Enhancing Finland's Defence Capability 2022, the aforementioned projects will be launched with a procurement authorisation of EUR 1.74 billion, extending until 2027. Together with the supplementary budget 2022, the amount allocated for defence materiel procurement totals approximately EUR 2 billion.
The funding will be used for procuring anti-tank and anti-aircraft weapons, combatant gear, artillery ammunition, field maintenance materiel, anti-ship missiles and air defence missiles, among other things.
Voluntary national defence
The discretionary government transfers intended to support the activities of national defence organisations will be increased by slightly under EUR 3.2 million to a total of EUR 8 million. This responds to the citizens' need to participate more in voluntary national defence work and training. Voluntary national defence training supports local defence in particular and thus plays an important role in developing the capabilities of the Defence Forces' troops. The increased central government transfers will allow the National Defence Training Association to raise its training volume, while improving the operational capacity of other national defence organisations as well.
The General Government Fiscal Plan also contains some technical amendments related to the financing profile of strategic projects and salaries of the personnel.
Inquiries to the Ministry of Defence: Miikka Pynnönen, Special Adviser to the Minister of Defence, tel. +358 50 5704119 and Kristiina Olsson, Director of Finance, tel. +358 295 140 220.