Finland’s poorest households have lost an average of approximately 80 euros per month per adult following changes to social security benefits and taxation introduced under Prime Minister Petteri Orpo’s government, according to a new study by the Finnish Institute for Health and Welfare (THL).
The study found that legislative changes implemented during the government’s 2023-2027 term are expected to reduce the incomes of households in the lowest income decile by eight percent. The impact is also expected to increase the number of people living on low incomes by approximately 102,000, including around 22,000 children.
The findings provide a broader assessment of how the government’s economic and social security policies have affected households across different income groups. THL examined changes to benefits and taxation throughout the government’s term, using detailed monthly income data from the Finnish Tax Administration. The approach was designed to provide a more accurate picture of the financial effects than earlier estimates.
According to THL, the updated calculations indicate that the impact on low-income households is somewhat smaller than the agency had previously estimated. An earlier assessment covering changes introduced in 2024 and 2025 projected that the number of people on low incomes would increase by 110,000, including 27,000 children.
The study also found that the effects of the government’s policies have varied considerably depending on household income. While people at the bottom of the income distribution have experienced financial losses, those in the highest income decile are expected to see their net incomes increase by approximately one percent.
This represents an average increase of around 50 euros per month per adult, according to THL.
“Changes to social security and taxation during the government term have different impacts on different income groups. In the highest income decile, net income is estimated to increase by around one percent, or approximately 50 euros per month per adult,” said Jussi Tervola, a chief researcher at THL, in the agency’s press release.
THL identified reductions in housing allowance and unemployment benefits during 2024 and 2025 as the main reasons for falling incomes among lower-income households. In contrast, the increases in disposable income among higher-income groups were largely linked to tax reductions, which mainly benefited people in employment.
The research also highlighted differences in how the changes have affected individual groups. Students have experienced the largest proportional decline in income as a result of the legislative changes. However, when measured in euros, unemployed people who work part-time while receiving unemployment benefits have suffered the largest financial losses. These benefits are administered by Kela, Finland’s Social Insurance Institution.
THL expects the effects of legislative changes scheduled for the following year to be relatively small compared with the reductions already introduced during the government’s term.
The findings add to the debate over the distributional effects of Finland’s social security and taxation reforms, particularly their consequences for people who rely on public benefits to support their everyday living costs.
