Ratatie street by Dixi in Tikkurila, Vantaa. Photo: Simo Räsänen / Wikipedia Commons
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The City of Vantaa will initiate a €60 million economic balancing programme during the next council term from 2026 to 2029. The city announced the plan on Wednesday in response to a worsening financial outlook driven by falling tax revenue, stalled construction, and rising unemployment.
An additional €30 million in spending growth will be curbed over the same period. The target is to bring municipal finances back to balance by 2029.
Pekka Timonen, the city’s mayor, said the problems stem from both local and national factors.
“Problems in Finland’s economy are clearly reflected in the finances of the City of Vantaa,” Timonen said. “The city’s income and expenditure must be brought back into balance. This will be achieved by cutting expenditure and increasing revenue.”
According to the city’s estimates, the total need for economic rebalancing stands at €60 million. On top of this, projected expenditure increases will be limited by €30 million, making the full scale of the programme €90 million in combined impact by 2029.
Vantaa’s finances have been under pressure for several years. Tax income has grown slowly, while the local housing market has stagnated. The construction sector, once a key employer, has faced mass layoffs due to a near standstill in new building projects.
The city also continues to feel the effects of restricted air traffic caused by Russia’s ongoing ban on Finnish flights using its airspace. The airport area, a major employment zone in the city, remains under strain.
Unemployment across the Helsinki metropolitan area has increased over the past year. In Vantaa, long-term unemployment is now described as high. The full effect of employment levels on city finances has grown since the national employment services reform (TE-uudistus) took effect at the beginning of 2025.
“Building the future and strengthening vitality will continue, even as the economy is balanced. We are a fast-changing, growing city. The ability to create new things is important for Vantaa,” Timonen said.
The city’s budget process for autumn 2025 will define specific measures. No decisions have been made yet on individual cuts or revenue increases. A new finance and strategy committee, appointed by the city council, will oversee the process and propose the final targets.
HT
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Source: www.helsinkitimes.fi
