Finland Unitary state

Reforms

A large-scale reform, entitled New Municipalities 2017, seeks to deal with new challenges and to strengthen the role played by municipalities.

In 2006, the PARAS programme focusing on improving municipal efficiency made it possible to reduce the number of Finnish municipalities from 431 to 320 in 2013. Inter-municipal cooperation, particularly among municipalities with less than 20 000 inhabitants, was also strengthened. A new reform known as New Municipalities 2017 is currently under discussion and could lead to a new restructuring of municipalities.

The main objective is to be able to cope with an ageing population and internal migration and to help these new municipalities become more robust professionally and economically. Health and social affairs would then be wholly dealt with as part of local competences. A new optimal size would subsequently need to be determined in order to be able to manage local public services in a more economical and efficient manner.

These reforms could thus lead to a new reduction in the number of municipalities. If the voluntary process of merging municipalities is not carried out in a given territory, inter-municipal cooperation would be emphasised instead, particularly in the areas of health and social matters, but for transport and housing as well. The authorities would also seek to achieve significant economies of scale.

However, the decrease in the number of municipalities raises questions regarding the size of some of them, as Finland is a country spread out over a wide area with most of its population concentrated in the southern parts. In the northern areas, the merger of some municipalities has elicited objections in light of the low population density and the resulting remoteness of public services for some inhabitants.

Local self-government in Finland:

While the principle of local selfgovernment as defined by the European Charter of Local Self-Government is well adhered to, certain small municipalities fear a loss of autonomy as a result of merger projects or a transfer of some of their competences to inter-municipal bodies. Nevertheless, the National Association of Local and Regional Authorities is closely associated with the process of reforms.

KEY REFORMS

• 2006: PARAS Programme: a local government efficiency programme that cut the number of municipalities (from 431 initially to 320 in 2013, then 313 in 2016). 
• Since 2006: cuts in the number of communes, creation of inter-municipal cooperation entities, changes to municipalities’ powers. 
• Sweeping reforms, entitled “New Municipalities 2017”, aiming to further strengthen the role of municipalities.
• Ongoing: plans to further cut the number of municipalities, transfer of social services and health powers to large municipalities and inter-municipalities, reform of oversight mechanisms for government financial transfers and assistance to local governements, launch of government cost-cutting and efficiency programmes.