COMPENDIUM CULTURAL POLICIES AND TRENDS IN EUROPE
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Finland/ 6. Financing of culture  

6.1 Short overview

The major role in financing the arts and culture in Finland is played by the central government (the state) and municipalities. The main policy domains financed by these two levels of government are artistic creation (arts education, support to artistic work) cultural and art institutions (most importantly libraries, theatres, orchestras and museums) and the maintenance of cultural heritage.

In practice, the central government and municipalities are the sole public financiers; in addition one can mention the Finnish Broadcasting Company and the copyright organisations – if the collective use of copyright compensation can be considered "public". There is no independent regional administration which would provide direct public funding although regional arts councils, foundations and regional councils can play an intermediary role between the municipal governance and central government in EU financed cultural projects.

The main Finnish public financing system is the so-called state’s share system, or "VOS" (the Finnish acronym for the system). The system is bifurcated: the statutory state share of financing can go either directly to the recipient, e.g. to a theatre, museum or orchestra (whose legal form is a foundation or an association, for example), or to a municipality which is supposed to use it for the assigned cultural institution but has the right to decide, if it really wishes to use the "share" for this purpose, or another one instead.

Renewal of the Finnish system of statutory funding (VOS) 2016-2017

The system of the statutory funding is undergoing a major reform in 2016-2017. The funding system, originally launched in the early 1990s, has been often criticized as it seems to only uphold the already established cultural organisations and groups, leaving outside the more experimental, upcoming groups and new forms of art, including circus. So far only museums, and from the performing arts only theatre, dance and orchestras have been receiving money from the system. A working group was appointed by the current Minister for Education and Culture Ms Sanni Grahn-Laasonen in 2016 to prepare the reform. The working group will present its final proposal in autumn 2017 and the renewed mechanism should come into force from January 2019.

In February 2017 a first report was launched, summarizing hearings and discussions held in autumn 2016 with the arts and cultural sector. According to the working group in the future money could be allocated to all performing arts groups and museum, with the aim of widening the spectrum of arts and culture. In the new mechanism funding could be allocated both according to calculating the FTEs (Full-time equivalent; the system according to which the statutory funding has so far been calculated) and also on a discretionary basis. One of the major revisions is that the support would become temporary, where the applicants would need to justify their support in certain intervals. In the evaluation, both artistic and organizational quality would be assessed. According to the working group, the assessment of the quality could be improved by including peer-review into the evaluation process and possibly also taking into account audience feedback. As the state support most likely will not increase in the future, the working group is prepared to the fact that some of the organisations or groups currently supported from the system might lose their support in the future. It is also possible that the support to some groups or organisations will decrease.

Tables 13 and 14 below highlight two recent trends in public funding of the arts and culture. Since 2006 the financing by the central government has increased strongly. The share of finance from the profits of Veikkaus Ltd, the state monopoly on lotto, lottery and sports betting first substantially diminished to year 2008, but has since then settled to a share of bit over 50%.

Table 13:  Finnish central government financing channeled through the Ministry of Education and Culture to the arts and culture, in million EUR, 2002-2014

Year

2002

2004

2006

2008

2010

2011

2012

2013

2014

2015

Financing

302.3

331.4

368.4

430.3

400.6

425.1

432.6

434.9

454

463

Share % *

5,6

5,6

5,8

6,0

6,3

6,4

6,6

6,8

6,9

6,8

*              Share of Ministry of Education and Culture expenditure. Source: Statistics Finland, Statistical Yearbook of Finland; State budget proposals and final accounts.

Table 14:  Distribution of revenues from the lottery and football pools (Veikkaus Ltd*) to arts**, in %, 2000-2015

Year

2000

2005

2008

2009

2010

2011

2012

2013

2014

2015***

Financing

208.7

185.3

189.2

204.4

209.3

220.3

222.4

224.6

237.0

237.0

Share %

55

46

46

44

43

43

43

43

52

50

* The government company operating the monopoly for lotto, lottery and sports betting (until the end of 2017). ** Including libraries until 2009. ***Budget Source: Statistics Finland, State budgets and final accounts

The level of central government financing through the budget of the Ministry of Education and Culture exceeded the pre-1991-1993 recession level for the first time in real terms only in 2006. Since then the growth trend in financing continued. This has been mainly due to the amendments of finance legislation which obliged central government to make corrective ex post inflation compensations to its earlier subsidies and committed budget-makers to correct inflation systematically and concurrently. These amendments alone have meant that the state's share in the financing of professional theatres, orchestras and museums was raised in 2008-2010 by 50 million EUR over and above the "regular" inflation compensation.

The share financed from the profits of Veikkaus Ltd has declined over the years, because the current Finnish legislation on betting stipulates that the profits channelled to culture, youth and sport can be used only for the support of arts, scientific research, sports and youth policy objectives and subsequently they e.g. cannot be used to subsidise public municipal libraries. Thus the substantial central government subsidies to libraries have been gradually moved to be paid from the regular state budget (from taxes), from the main budget division of the Ministry of Finance.

The new Veikkaus

From January 2017 onwards the Finnish gaming system was reformed as the previously separate three operators Fintoto (horse racing), Finland’s Slot Machine Association (RAY), and Veikkaus merged into a single gaming company owned by the Finnish State. The merger aims at strengthening the Finnish gaming system while reinforcing the mitigation of the social and health-related problems associated with gaming. This will bring all grants and different ministries together. The grants based on Veikkaus funds can be applied for with the relevant Ministries, which are also responsible for granting them. The application process will remain the same with the Ministry of Education and Culture. The preparation, payments, follow-up, and monitoring of the funds distribution by the Ministry of Social Affairs and Health will be carried out by the Funding Centre for Social Welfare and Health Organisations. As regards the equine industry and equestrian sports, the funds will be granted by the Ministry of Agriculture and Forestry.

Out of the proceeds of the new enlarged Veikkaus, 53% will be channelled to sports, science, culture, and youth work. Promoting health and social wellbeing will receive 43% of the funds, whereas horse breeding and equestrian sports will receive 4%.


Chapter published: 25-04-2017

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