Vantaa is a forward-looking city – in the year 2024 Vantaa invests in the future

Vantaa, which will celebrate its 50th birthday next year, focuses on future growth. We especially invest in the city's safety, youth work, and education – without forgetting the residents’ wellbeing and the city's biodiversity.

Mayor Pekka Timonen

Figures in brief 

The city’s and funds’ combined operating income in the 2024 budget amounts to €343 million, while the operating costs amount to €1 031 million. Compared with the 2023 budget, the operating income will grow by 0.4% and operating costs by 4.2%. Compared to the second 2023 interim report’s annual forecast, the income will increase by 4%, and the costs by 2.1%. 

The 2024 budget figures are not comparable to the 2022 financial statement figures, due to the wellbeing services county reform that took place on January 1, 2023. The TE2024 reform will enter into force at the beginning of 2025, and it, too, will have a major impact on municipal finances. The TE2024 reform permanently transfers the arrangement of employment and business development services to the municipalities. This change will increase the city’s operating costs, but it will also increase the city’s state contributions. 

Tax revenues and state contributions cover around 77% of the city's operating costs in 2024. The annual margin of the 2024 budget is €111 million and the deficit for period is -€3.5 million.

The 2024 result for period is estimated to be slightly negative. In the short run, the drastic decrease in building will negatively impact the city’s land-sale revenues, and the general economic downturn is bound to restrict any increase in tax revenues.

Recession will decelerate economic growth – Vantaa's overall situation in 2024

During the past few years, Vantaa’s operating environment has undergone rapid changes and is difficult to predict. The city's strong and fast recovery from the economic crisis resulting from the coronavirus pandemic turned into new economic uncertainties when the inflation—accelerated by Russia's attack war on Ukraine and the resulting increases in investment levels, decreed by central banks—cut down households’ purchasing power and businesses’ willingness to make investments. The overall economic situation in Finland has turned into recession. Economic growth is projected to begin slowly and mildly.

Vantaa’s population growth is estimated to continue. In 2022, Vantaa's population increased by approximately 3 600 residents (1.5%), which is1 600 more than in 2021. In 2023, the population growth is projected to increase and amount to more than 4,000 people. The population projection anticipates the growth to remain on a similar level in the new few years, as well. 

The dramatic fall in housing construction—if it prolongs—may significantly decelerate Vantaa’s population growth, too. The monthly number of completed housing units is projected to gradually diminish as of the end of 2023. Beginning of new construction projects has dramatically dropped during 2023, which is reflected as a reduced number of completed housing units during the following two years, at least. 

The economic downturn has put an end to diminished unemployment in Vantaa, too. In July 2023, Vantaa’s unemployment rate was 11.6%, which was only 0.2% lower than the rate in the previous year. Before the coronavirus pandemic, Vantaa’s unemployment rate amounted to around 8.5%, which means that recovery from the pandemic is still going on. What is of particular concern is the level of long-term unemployment, which has also stopped decreasing. Foreign-language speakers’ unemployment rate has increased everywhere in the metropolitan area. Stagnation of housing construction is estimated to weaken the building industry’s employment situation.

Balancing the economy has generated results – Vantaa is investing in the future  

The 2024 budget has targeted added resources to meet the increased service needs of, especially, education, early childhood education, and urban culture. The cost-increasing impacts on purchased services, due to the general price development, have also been accounted for.

“In addition to the daycare center and school projects under construction, we will begin to build Elmo swimming hall and Northeast Vantaa sports hall. Renovating Vantaa Vocational College Varia’s Vehkala campus continues, basic renovation of Håkansböle manor's main building begins, and basic renovation of Cultural center Vernissa will be completed, “Timonen says.

Building Vantaa light rail will begin in 2024. The light rail will improve the areas’ accessibility and develop the city by creating new housing, jobs, and services along its route.

Mayor Pekka Timonen

Key investments in 2024

• Elmo swimming hall  

• Kuusijärvi Recreation Centre Vantaa's new saunas 

• Cultural center Vernissa's basic renovation  

• Håkansböle manor’s basic renovation  

• Four new daycare centers  

• Expansions or renovations of five schools

The city’s long-term balancing of the economy has brought results. Vantaa's economy is on healthy ground, and the city's balance has strengthened. Moreover, during the past six years, Vantaa has been able to pay back its debts by €300 million and is currently one of the least indebted big cities in Finland. Thus, the city is in a position to implement investments securing its future growth and development.

Balancing the economy progresses in accordance with the productivity and growth program with the goal of raising the annual margin to amount to at least €130 million in 2025. In addition to the city’s investment in Vantaa light rail, the city's basic investments are rising, so increasing the annual margin also over the next few years is necessary. 

“We are preparing ourselves for the next reform changing municipal finances. We are devising a new service entity for the future TE reform, when the state's public services supporting businesses’ growth are transferred to the city,” Timonen adds. 

The government is also planning a state-contribution reform that is scheduled to enter into force at the beginning of 2026, which means that municipal finances will undergo changes for a long time to come.

Vitality for the next 50 years  

The year 2024 is the City of Vantaa's jubilee year, and this is seen in the city’s budget. Resources and appropriations have been added to planning the city's top projects. 

“Developing the city translates into long-term work. The big public investment projects over the next few years are Vantaa’s strong investment into strengthening the entire region as well as the economy of Finland. At the same time, they bolster Vantaa’s future vitality for its next 50-year journey,” Timonen says. 

Year 2024 key figures 

• population: 251 235 (forecast on Dec. 31, 2024)
• deficit for period -€3.5 million
• income tax return: €63.6 million
• internal financing of investments: 57%
• tax revenues: € 2 436 / resident
• operating costs: € 4 104 /resident
• loan portfolio: € 3 408 /resident

Proposed tax percentages

• income tax percentage: 6.4%
• 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

Next 

The mayor's budget proposal will progress to decisionmaking. The city executive board is scheduled to give its budget proposal to the city council on October 31, and the city council is to decide on the budget on November 13.

Additional information:

Visit our website: https://www.vantaa.fi/en/budget



Further information on the budget proposal is available from the city council’s presentation on the Vantaa Channel (in Finnish). Watch the recording of the city council's budget meeting on 2 October on the Vantaa Channel at: https://www.vantaa.fi/fi/kokouskalenteri/2102023-kaupunginvaltuusto