Espoon kaupunki - Esbo stad

Mayor Jukka Mäkelä’s budget proposal for 2022: Focus on recovery from the coronavirus pandemic and safeguarding the well-being of children and young people


The city’s main goals for this council term include balancing the city’s economy, recovering from the coronavirus pandemic, implementing the health and social services reform and working towards achieving carbon neutrality. In addition, the city will increase its efforts to improve the integration and employment of immigrants.

Mayor Jukka Mäkelä.
Mayor Jukka Mäkelä.

The council term 2021–2025 started with the updating of the Espoo Story, the city’s strategy, and defining the goals for the council term. Now and in the future, Espoo wants to be the most sustainable city in Europe and develop the growing city economically, environmentally, socially and culturally. The implementation of the health and social services reform will change the city’s operations from the beginning of 2023. One of the goals set in the Espoo Story is that Espoo is the top city for culture and education.

“In 2022, we especially have to focus our efforts on our recovery from the coronavirus pandemic and ensure the well-being of children and young people. We will use all means to reduce waiting times for treatment. The pandemic has highlighted mental health problems, and we have to find solutions to address the situation,” says Mayor Jukka Mäkelä. “We also have to ensure growth after the pandemic, improve the conditions for business and reduce unemployment,” he adds.

Espoo’s role as an innovation capital is essential for the competitiveness of the entire country.

“Espoo has to respond better to the integration and employment of immigrants. Immigration is rapidly changing our population structure, and the city’s service provision and development are thus faced with new opportunities and challenges that must be addressed in order for Espoo to remain the most sustainable city in Europe.”

Espoo’s economic outlook is good, but the health, social and rescue services reform will increase Espoo’s responsibility for the funding of the entire country’s health and social services. This is unreasonable for a growing city as growth requires investments in service facilities, sustainable public transport and urban structures. The state has to participate more in financing the implementation of the land use, housing and transport programme (MAL) so that it is still possible for Espoo to continue growing as it supports the growth of the entire country.

“We are all responsible for solving these major challenges. We have to make an effort to ensure that the outlook for Espoo and the city’s economy remain positive. The implementation of the Espoo Story requires ambition and good leadership,” Mayor Mäkelä says.

Adjustment to a new financing model through the Economically Sustainable Espoo programme

One of the goals set in the Espoo Story is that Espoo is economically sustainable and offers competitive tax rates.

“During this council term, we will implement the Economically Sustainable Espoo productivity and adjustment programme. The aim of the programme is to achieve a balance between expenditure and revenue, to bring the level of investment down, closer to the internal financing capacity, and to ensure fairer cost distribution between the state and the municipality,” Mayor Mäkelä says.

The target levels and measures of the programme will be updated during the spring of 2022 with regard to the impact of the health, social and rescue services reform so that the programme will strengthen Espoo’s ability to adjust to the economic changes caused by the reform. The programme will continue until 2025, and the city’s office-holders and elected officials are obliged to implement the objectives of balancing the economy.

The financial plan implements the Espoo Story and the Economically Sustainable Espoo programme

Tax revenue for 2022 is based on the forecast of economic growth outlined in the economic survey published by the Ministry of Finance this autumn. Tax funding is expected to increase by around 2.7% in 2022. The growth will be reduced due to the ending of the temporary increase in the municipalities’ share of corporation tax revenue. The net costs of organising services, i.e. the operating margin deficit, will increase by 3.6% in 2022, which will exceed the increase in tax funding. The annual margin is estimated to rise to EUR 204 million, and the financial result for the accounting period is expected to reach EUR 15 million.

“The financial plan years involve a lot of uncertainty,” says Mayor Mäkelä. “The budget and financial plan have been prepared, especially with regard to the years 2023–2024, based on very preliminary estimates of the post-reform level of funding. The state will not decide on the reduction of the local income tax rate until the summer of 2022, when the cost estimate for the health, social and rescue services to be transferred has been specified.”

The entire Corporate Group of Espoo will invest some EUR 668 million in 2022. Between 2022 and 2031, it will invest around EUR 4.2 billion, an average of EUR 420 million per year. Investments in the West Metro and its development corridor as well as the City Rail Link and the Jokeri Light Rail are investments into the growth potential of the entire country. The city’s investment programme will have a total budget of EUR 2.5 billion. The majority of the investments will be allocated to the construction and renovation of schools and day care centres in accordance with the Schools in Shape programme.

As internal financing will not cover the investments required for the growth of the city, the city’s loan portfolio will increase during the budget year by EUR 147 million and the Corporate Group’s loan portfolio will grow by EUR 275 million. Based on the preliminary scenarios of the city and the Corporate Group, the health, social and rescue services reform will slow down the annual growth of the city’s tax funding, and the annual margin will not be sufficient to cover the city’s and the Corporate Group’s major depreciation or to finance growth investments. The city will continue to accumulate debt unless the state increases its contribution to financing growth.

50 years as a city – the start of a new era

“The Espoo Story and the Economically Sustainable Espoo programme are our key tools. By implementing them, we will improve Espoo’s ability to adapt to future challenges,” the Mayor says.

Next year marks Espoo’s 50 years as a city. The anniversary year is an opportunity to highlight the diverse services and expertise of the developing city. The coming year will also provide a good platform for strengthening community spirit and participation among residents and actors.

“At the same time, the city is preparing for a new era. The establishment of the Western Uusimaa well-being services county in 2023 will have a significant impact on the city organisation and the majority of our activities,” says Mayor Mäkelä.

The Espoo City Council will decide on the budget for 2022 on 8 December 2021.



Mayor Jukka Mäkelä.
Mayor Jukka Mäkelä.

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A networked Espoo comprising five city centres will be a pioneering responsible and humane city that is a good place to live, learn, work and do business in and where residents can have their say in matters.



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