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Finland Growth of the Social Welfare System
In the last years of the nineteenth century, Finnish
social
policy had as its goal a lessening of class friction. The
few
existing pieces of social legislation addressed the needs
of
specific groups rather than of society as a whole. After
the
Civil War, little was accomplished in welfare legislation.
A
woefully insufficient national pension plan was set up in
1937,
as were measures to aid needy mothers. It was only after
World
War II that Finnish social policy acquired the
characteristics
that in the next decades made it similar to other Nordic
systems
of social welfare.
According to Finnish sociologist Erik Allardt, the
hallmark
of the Nordic welfare system was its comprehensiveness.
Unlike
the welfare systems of the United States or most West
European
countries, those of the Nordic countries covered the
entire
population, and they were not limited to those groups
unable to
care for themselves. Examples of this universality of
coverage
were national flat-rate pensions available to all once
they
reached a certain age, regardless of what they had paid
into the
plan, and national health plans based on medical needs
rather
than on financial means. In addition, the citizens of the
Nordic
countries had a legal right to the benefits provided by
their
welfare systems, the provisions of which were designed to
meet
what was perceived as a collective responsibility to
ensure
everyone a decent standard of living. The Nordic system
also was
distinguished by the many aspects of people's lives it
touched
upon.
The Finnish welfare system differed from those of other
Nordic countries mainly in that its benefits were lower in
some
categories, such as sickness and unemployment payments;
otherwise, the Finnish system fit into the Nordic
conception of
social welfare. Finnish social expenditures constituted
about 7
percent of the country's gross domestic product
(GDP--see Glossary)
in 1950, roughly equal to what Sweden, Denmark,
and
Norway were spending. By the mid-1980s, Finland's social
expenditures had risen to about 24 percent of GDP,
compared with
the other countries' respective 35, 30, and 22 percent
(see
table 9, Appendix A). Less than 10 percent of these expenditures
was
paid for by Finnish wage earners; the remainder came
roughly
equally from the state and from employers. Until the
second half
of the 1970s, Finnish employers had paid a higher share of
social
outlays than had their counterparts in the other Nordic
countries. In response to the slowdown of the world
economy after
1973, there was some shifting of social burdens to the
state,
which made Finnish companies more price competitive
abroad.
Finland's welfare system also differed from those of
its
neighbors in that it was put in place slightly later than
theirs,
and it was only fully realized in the decade after the
formation
of the Red-Earth government in 1966
(see Finland in the Era of Consensus, 1966-81
, ch. 1). Just after World War II, the
Finns
directed their attention to maternal and child care. In
1957 the
government established an improved national pension plan
and
supplemented it in the early 1960s with private pension
funds.
Unemployment aid was organized in 1959 and in 1960, and it
was
reformed in 1972. Legislation of the 1950s and the 1960s
also
mandated the construction of a network of hospitals, the
education of more medical personnel, and, from 1963 to the
early
1970s, the establishment of a system of health insurance.
The
housing allowance system expanded during the 1960s to
reach everwidening circles of the population. Health-care officials
turned
away from hospital care in the 1970s, and they began to
emphasize
the use of smaller local clinics. By the 1980s, the
Finnish
welfare system was up to Nordic standards and had the
support of
most Finns. All major political parties were committed to
maintaining it, and its role in Finnish society seemed
secure for
the coming decades.
Data as of December 1988
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