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Government proposes EUR 3.36 billion for the Ministry of Transport and Communications budget

Government proposes EUR 3.36 billion for the Ministry of Transport and Communications budget

Press release 19.09.2017 12.53 fi sv en

The Government proposes that EUR 3.36 billion be allocated to the administrative branch of the Ministry of Transport and Communications for 2018. It is EUR 134 million more than in the 2017 budget.

It is proposed that EUR 2 billion be allocated to the transport network, EUR 214 million to transport subsidies and outsourced services, EUR 523 million to communication services and networks and communication subsidies, EUR 70 million to services for transport provided by the authorities, EUR 495 million to administration and joint expenditure for the administrative branch, and EUR 45 million to services concerning the weather, sea and climate conditions.

Reduction of the repair debt continues

In transport infrastructure maintenance, emphasis will be on the condition and quality of transport routes. A total of EUR 1.4 billion is proposed to be allocated to basic transport infrastructure maintenance. Of this appropriation EUR 453 million will be allocated to reducing the repair debt in Government’s key strategic projects. The aim is to curb the growth of the repair debt. The government repair debt programme focuses on management of the repair debt, businesses’ and individuals’ customer needs, digitalisation and new services.

New transport infrastructure projects

A total of EUR 505 million will be allocated to development investments. The Government proposes that four new development projects be launched in 2018: Ring Road I at Laajalahti (EUR 20 million), park-and-ride arrangements for the western metro extension (EUR 7 million), Vuosaari fairway (EUR 12.5 million) and Kokkola fairway (EUR 45 million).

The Ring Road I at Laajalahti is related to the construction of the Raide-Jokeri light rail link. Raide-Jokeri is one of the most important public transport projects related to cross-traffic volumes in the Helsinki metropolitan area and essential in improving the service level of sustainable transport modes. The Ring Road project enables the implementation of the Raide-Jokeri project from Itäkeskus in Helsinki to Keilaniemi in Espoo as planned. The appropriation requirement for 2018 is EUR 2 million.

A contract authorisation of EUR 7 million and an appropriation of EUR 7 million are proposed for the project on park-and-ride arrangements for the western metro extension. The trunk route for feeder traffic for the western metro line extending to Matinkylä will be the western motorway, Länsiväylä. The second phase of the western metro line, from Matinkylä to Kivenlahti, continues the land use corridor relying on rail transport to southwestern Espoo.

The total budget for the Vuosaari fairway project is EUR 25 million, which is funded in equal shares by the state and the Port of Helsinki. The amount of TEN assistance intended to be applied for the project is EUR 5 million. The project aims to ensure a favourable environment for container vessel traffic at the port as the size of vessels is expected to grow in future. Its aim is also to ensure the availability of cost-efficient water transport connections at the Äänekoski bioproduct mill. The appropriation requirement in 2018 is EUR 1 million.

The Kokkola fairway project improves the transport economy of goods passing through the port of Kokkola. The project also covers the deepening and expanding work at the port. The responsibility for their planning and implementation lies with the port of Kokkola. The total budget for improving the Kokkola fairway is EUR 45 million. The intention is to share the project costs between the state and the city. The appropriation requirement in 2018 is EUR 15 million.

The Government has also decided to improve the transport connections between Hailuoto and the mainland. The Hailuoto fixed link will be carried out under the public-private partnership scheme so that the link will, in the long term, be economically more advantageous and provide a better capacity for the users. An annual fee will compensate the yearly operating costs of the ferry services. The aim is to make a decision on launching the project when the draft budget for 2018 is amended.

The Government has decided to make preparations for one transport network project, or two at the most, so that decisions concerning the project(s) can be made in the government discussion on spending limits in spring 2018, and the project(s) can be started during the current electoral term.

In the budget for 2017 authorisations were issued for the western metro line, Raide-Jokeri light rail link and Tampere tramway. Discretionary government transfer for these projects will be paid retroactively on the basis of the actual expenses in the previous year. A total of EUR 31.5 million will be allocated to the construction of the western metro line, EUR 0.3 million to the Raide-Jokeri and EUR 15.8 million to the first phase of the construction of the Tampere tramway.

Support for transport services

A total of EUR 214 million is proposed to be used to support and purchase transport services. The sum is close to this year's level.

Altogether EUR 101.4 million of the sum will be allocated to improving the competitiveness of vessels in maritime transport. The Ministry of Transport and Communications is preparing a proposal for the autumn supplementary budget according to which the state would support maritime transport so that it would reimburse the employers for their share of the unemployment insurance contribution paid for employees with full or limited tax liability and to whom the “pay as you earn” scheme has been applied. The proposed change would only apply to support to be paid on the basis of the costs accrued in 2017. The proposal is not expected to increase the appropriation.

Of the appropriation of EUR 84.5 million allocated for purchasing and developing public transport services, EUR 30.2 million is intended to be used for covering the costs of the train transport purchase contracts between the state and the VR Group Ltd for 2016–2019, EUR 33.5 million for tariff obligations and for purchasing and developing regional and local transport services by the centres for Economic Development, Transport and the Environment, EUR 17.9 million for supporting public transport in large and medium-sized cities, and EUR 2.9 million for purchasing air transport services, supporting transport connections across the Kvarken as well as for development projects and mobility management services.

No rail goods transport tax, halving of fairway dues to continue

In relation to the draft budget, the Government will submit to Parliament a proposal to amend the act on rail network tax. In the proposal the Government suggests that the waiving of the rail goods transport tax be continued until the end of 2018. No rail network tax will be collected in electric or diesel-powered goods transport in 2015–2018. The annual impact of tax income is estimated to be around EUR 12.0 million. A total of EUR 4.8 million will be collected as rail network tax.

The Government will also submit to Parliament a proposal related to the draft budget for amending the act on fairway dues. The Government proposes that fairway dues will continue to be halved until the end of 2018. In 2015–2018 the fairway due was halved as part of the sulphur compensation package and the labour market solution so that it was decreased with an emphasis on cargo vessels and best ice classes. A total of 47.4 million euros will be collected as fairway dues.

Promoting low-emission transport

In the government session on spending limits in spring 2017, a decision was made to invest EUR 100 million in the Government’s Energy and Climate Strategy measures in 2018–2021. In the 2018 budget, EUR 16 million will be reserved for implementing the transport measures of the Strategy. An allocation of EUR 6 million will be reserved to support the conversion of gas and flexifuel vehicles and the acquisition of vehicles that operate solely on electricity. An allocation of EUR 4.5 million will be used equitably across the regions to promote the construction of a recharging and distribution network and the process of electrification for logistics in built-up areas. Public passenger transport in urban regions will be supported by EUR 3.5 million. In addition, EUR 2 million will be allocated for rail transport services to support the reshaping of people’s mobility habits.

The Government also agreed in its budget session that EUR 8 million will be allocated for the car scrapping incentive for 2018. Relating to the draft budget, the Government will submit to Parliament proposals for acts on the scrapping incentive, support for the acquisition of electric cars and the conversion of gas and ethanol cars.

Additional support for news and current affairs on television channels

In the first 2017 supplementary budget, an allocation of EUR 1 million was made to support news and current affairs on channels serving the public interest. A total of EUR 2 million is now proposed for the same purpose. The appropriation is meant to be used to pay discretionary government transfers for providing news and current affairs on public interest TV channels. The aim of the support is to ensure the diversity of news broadcasting and alternative news sources in television broadcasting that reaches the general public.

A total of EUR 2 million will be allocated to increasing the reliability and information security of the digital society. Reliable and secure handling of digital information will be a more and more important production factor in the development of new transport services and markets.

The national broadband project continues. The Finnish Communications Regulatory Authority may use the contracts that are in line with the authorisations issued in earlier budgets insofar as they have not yet been used.

No index increase for the Finnish Broadcasting Company’s funding is proposed to be made for 2018.

Information on weather, sea and climate conditions

An additional EUR 1 million is proposed for the operating costs of the Finnish Meteorological Institute to expand its radar network as the current weather radar network does not cover the whole country. The weather radar network is essential for air and road transport safety. The new radar is to be located in Kainuu.

An appropriation of EUR 0.75 million is proposed for financing the construction of the Aerosols, Clouds and Trace Gases Research Infrastructure (ACTRIS). The appropriation enables to update the compatibility of the national ACTRIS network of stations, to further develop the ACTRIS research infrastructure to make it the best in the world, to create a competitive research environment for researchers in the sector and to locate the headquarters of the ACTRIS operations in Finland.

Inquiries:

Transport infrastructure projects:

Risto Murto, Director of Unit, tel. + 358 40 505 3320

Repair debt and low-emission transport: Ari-Pekka Manninen, Director of Unit, tel. + 358 50 594 2679

Support for transport services and for news and current affairs on TV channels: Olli-Pekka Rantala, Director-General, tel. +358 50 344 3400

The entire draft budget and especially the act on rail network tax; act on fairway dues; information on weather, sea and climate conditions: Juhapekka Ristola, Director-General, tel. +358 40 078 8530

Jaana Kuusisto, Director of Finance, tel. + 358 40 837 8839