Strongly growing Vantaa’s finances on solid ground - next year’s focus on recovery from coronavirus epidemic and balancing the economy


Mayor of Vantaa, Ritva Viljanen, has published her 2022 budget proposal.

A person in front of the town hall holding a tablet. The tablet screen shows a graph of the budget.

Figures in brief 

The city’s, its public utilities’, and funds’ combined operating income in the 2022 budget amounts to      €474 million, while the operating costs amount to €1.849 billion. Compared with the 2021 budget, the operating income will grow by 0.7% and operating costs by 5.0%. Compared with the second 2021 interim report’s annual forecast, the income will decrease by 8.3%, while the costs will increase by 1.6%. The decline in the income as compared with the second 2021 interim report’s annual forecast is due to the state’s 2021 remunerations for the coronavirus pandemic.  

The annual margin of the 2022 budget is €90.9 million and the deficit for period is -€20.3 million. The annual margin can cover 81.5% of depreciations. The municipal tax percentage will remain 19%. Investments in the 2022-2025 council term will rise €100 million over the previous council term.  

The growing city's overall financial situation in 2022 

The coronavirus epidemic will continue to bring uncertainty in the future as well, but the city’s growth will, nevertheless, continue. The city will keep its investments on a stimulative level, which is of importance as the unexceptionally high unemployment rate prevails.  

“We will continue our work on balancing the economy, so that our operational economy will be balanced in 2023. We have for several years worked systematically and managed to get Vantaa’s finances on solid ground - regardless of the coronavirus pandemic; our worst fears did not come true. Beneficial factors include state aid, better-than-anticipated development of tax revenues, and our own work—targeted at savings worth almost €80 million—on balancing the economy, which we started last year,” says Ritva Viljanen, Mayor of the City of Vantaa. 

The city will invest €18 million in recovery from the coronavirus epidemic in 2021-2023 by shortening its service and healthcare debt. Planning and preparing the launch of the new wellbeing services counties, which will begin their operations as of 2023, plays an essential role. 

Compliant with the council treaty, the ultimate goal of balancing Vantaa's economy is the residents’ sustained wellbeing. The municipal tax percentage will remain 19%; neither will the public or permanent residential building real-estate tax percentage be increased. Balancing measures will boost the city’s annual margin, so that the city will be able to finance its investments without increased net borrowing. The growth and productivity of the city’s operating costs will be improved on a yearly basis, and unnecessary assets will be sold. Vantaa is preparing a property-sales program and an income-growth program. At the same time, the city is investigating selling its healthcare and social-welfare properties, as well as the future of the city's healthcare and social-welfare properties.  

“Vantaa continues its rapid growth. Next year, population growth is projected to be slighter than before, but it is, however, projected to strengthen as of 2023. The momentary decrease is due to the negative domestic net migration caused by the coronavirus epidemic. Population growth will present challenges to service production and investments also in the coming years,” Viljanen tells. 

In 2020, Vantaa’s population growth amounted to almost 3,500. In 2021, the growth is projected to clearly fall behind the above figure, amounting to approximately 2,800. Housing development in 2021 is estimated to be close to the 2020 level and to slightly decrease in 2022, when around 2,000 new housing units are forecast to be completed. As of 2023, housing development is believed to drastically increase.  

The amount of loans will be dictated by a resident-specific average. The current average is €3,600 per resident, and the goal is projected to be easily attained.  

As of 2020, the coronavirus epidemic has had a negative impact on the unemployment rate. In August 2021, Vantaa’s unemployment rate was 13.9%, which was only 0.8% lower than the rate in the previous year. Before the coronavirus epidemic, Vantaa’s unemployment rate amounted to around 8.5%, which means that recovery from the epidemic has been slow. Especially worrying is the steady and still-ongoing increase in the number of the long-term unemployed. Likewise, youth unemployment has remained on a high level, regardless of decreasing. The Vantaa and Kerava’s municipal employment trial began in March 2021. The difficult employment situation presents big expectations to the trial and the results of the work. 

The health and social services reform dramatically changes the city's operating environment 

The Parliament ratified legislation on the health and social services reform in late June. Vantaa and Kerava’s social and health services, as well as search and rescue (SAR) services, will be the responsibility of the Vantaa and Kerava wellbeing services county from the beginning of 2023. More than 4,000 of Vantaa’s employees will transfer to the wellbeing services county. Therefore, year 2022 will be the last year when the City of Vantaa acts in its present scope, and Vantaa’s social-welfare and healthcare budget for next year will be the last of its kind, before the Vantaa and Kerava wellbeing services county begins its operations at the beginning of 2023.  

“Planning of and the related preparations for the launch of the wellbeing services county will play the key role next year, so that we can flexibly transfer the responsibility for arranging services from the city to the new wellbeing services county right from the beginning of 2023. We are making plans for placing the services, and as many as over 2,000 agreements will have to be altered. We will build solid partnering structures with the wellbeing services county.” 

Besides operational changes, the reform will greatly affect the city's finances, too. Removed from the city’s finances will be costs arising from social welfare, healthcare, and search and rescue, but cuts will also be made in tax revenues and state aids. The combined cut of all tax revenues and state aids will likely amount to more than half the current level. We will know the exact amount of the cut in the course of 2022. In the future, we will have more limited means to maintain the balance of the economy and our investment capacity.  

Recovery plan for combating the impacts of the coronavirus epidemic  

The year 2021 already is the second year when the coronavirus pandemic has dramatically affected societies all over the world, including the City of Vantaa in Finland. Thanks to increasing vaccination coverage, the ongoing situation of the epidemic is ameliorating, and the restrictions imposed by the coronavirus pandemic are being lifted. Nevertheless, the pandemic will bring uncertainty into the future, and the long-term impacts of the crisis remain partly unknown. 

In 2021, especially social welfare and healthcare incurred extensive additional costs due to  coronavirus testing, vaccinations, tracking, and treatment. The state has promised to fully remunerate municipalities for these direct costs arising from the coronavirus epidemic. The state has also promised corresponding remunerations for the year 2022. The 2022 budget has no projections for potential direct costs arising from the coronavirus epidemic nor for state aids to be gained for them. 

Vantaa was among the first cities to compile a recovery plan for after-care of the coronavirus pandemic. A total of €18 million will be spent on the program.  

“The coronavirus epidemic has, in practice, affected every resident, company, community, and city organization in multiple ways. We have highlighted eight key goals of the recovery plan as regards the areas that the epidemic and restrictions have most impacted. The recovery plan will prioritize supporting the wellbeing of children and the young, as well as bridging the learning gap. The majority of the measures to be taken are required in the Health and Social Welfare Department, even though much will be done in the Education and Learning Department and the Urban Culture Department. In order to achieve these goals, were have prepared altogether around 40 measures to be taken,” Viljanen states. 

Balanced economy by 2023 

In early 2021, Vantaa compiled and approved the 2021-2025 productivity and growth program, which aims to improve the city's financial situation in such a way that the operational economy will be balanced with a surplus fiscal year in 2023. The aim is to annually increase the annual margin, so that in 2025 it will amount to at least €130 million, which means that the city’s basic investments could be carried out without having to resort to net borrowing. The 2022 budget includes measures to balance the city’s economy worth €10.5 million. The 2022 result for period will remain negative, but the balancing of the economy will progress in accordance with the productivity and growth plan by accounting for the one-off nature of the additional costs in the recovery plan. 

“In the budget for next year, we have targeted additional resources especially to the healthcare and social welfare sector, as well as to education and early childhood education, to meet with the increased service demands. The €18-million sum, targeted at covering the service and healthcare debt caused by the 2021-2023 coronavirus epidemic, will increase the one-off costs in 2022 by a sum of €11.3 million.” 

Myriad significant investments  

The City of Vantaa will next year have numerous important investment projects, the majority of which are targeted at building of premises. Planning of the Vantaa light rail is progressing, and traffic is scheduled to begin in 2028. Key projects consist of, among others, building several new daycare centers: next year, altogether seven new daycare centers will be under construction; the majority of them will also be completed in the course of the year. Other new projects include: expansion of Jokiniemen koulu (Jokiniemi school), basic renovation of Kilterin koulu (Kilteri school), renovating Ring Road III along Askisto, as well as preliminary building of Elmo area for a new swimming hall.   

Vantaa Vocational College Varia’s big investment project in Vehkala is beginning, and a new campus is also being planned in Tikkurila. Kuusijärvi outdoor recreation area’s development into an important nature site will continue, and the city is working on cultural factory Vernissa and Hakunila sports park. After a lengthy wait, Kivistö shopping and service center will be completed, and the city will transfer some of its services into the center. A new part of Luhtitie will be built in Myyrmäki, which will create the facilities for a new Helsinki Region Transport, HSL, trunk route and provide the local residents with better mass transport services. 


The mayor's budget proposal will progress to decisionmaking. The city council will decide on the tax percentages in its meeting on November 15. The city executive board is scheduled to give its budget proposal to the city council on November 30, and the city council is to decide on the budget on December 13.  

Vantaa is preparing a new 2022-2025 city strategy that will dictate Vantaa’s development also after the health and social services reform. Promoting the residents’ wellbeing is an essential common task for both the City of Vantaa and the Vantaa-Kerava wellbeing services county, which means that the organizations must invest in  cooperation. 

Year 2022 key figures 

  • population: 243,368 (Dec. 31, 2022) 
  • deficit for period -€20.3 million  
  • income tax return: €51.3 million 
  • internal financing of investments: 59% 
  • tax revenues: €4,771 / resident 
  • municipal income tax: € 4,002 / resident 
  • operating costs: €7,598 / resident 
  • investments: €645 / resident 
  • loan portfolio: €3,953 /resident 

Tax percentages 

  • income tax percentage: 19 
  • public real-estate tax percentage: 1.28 
  • permanent residential building: 0.41 
  • other residential building: 1.25 
  • power plant: 3.10 
  • unbuilt building plot: 6.00 

Key investments 

  • Building new daycare centers   
  • Repair of schools  
  • Building the new city office begins   
  • Building Luhtitie in Myyrmäki  
  • Enhancing Hakunila sports park  
  • Kuusijärvi outdoor recreation area  
  • Preliminary building of Elmo sports park for the swimming hall  
  • Renovating Ring Road III along Askisto  
  • Planning Vantaa light rail