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Spending limits discussion 2014: Decisions from students' point of view


The Finnish Government made a number of decisions concerning students in spending limits discussion in March. This is HYY's summary about what was actually decided. The practical consequences of many decisions are still uncertain or their implementation has not yet been decided. HYY and other student organisations still try to have effect in order to make the implementations as sensible as possible from the students' point of view.
In HYY's view, it is irresponsible to cut education funding and student welfare, as each cut euro will be multiplied in the future, whereas every invested euro will pay itself back in multiple ways in the future.



  • Rental subsidy to be discontinued

The Government decided to discontinue the rental subsidy of Finnish Student Health Service (FSHS). The discontinuation of the rental subsidy paid by the Ministry of Education and Culture will decrease 10 per cent of the income of FSHS. In HYY's view, the services provided by FSHS should not be compromised and we aim at having influence to maintain the current services.

  • No decision was made to expand FSHS services for polytechnic students 

Funds were not allocated for expanding FSHS services for polytechnic students.


Higher education funding

  • University index to be cut in half 

Index increases for university funding – increases based on a general increase in costs – will be cut in half for the years of 2015 and 2016. Index increases should cover the annually increasing facility and salary expenses. The halving of this so-called university index will make the operations of higher education institutions more difficult.


Student financial aid

  • Index increase for student financial aid to be cut 

Student financial aid has been tied to the index since 1 Aug 2013 – therefore, it should annually increase at the same rate as the cost of living does. Now the index is cut and the increase will be 0.4% for the years of 2015-2016. Therefore, the increase is not implemented in accordance with the increase in the cost of living.

  • Student financial aid months after the Master's degree may no longer be used for a degree on the same level 

Previously, students have been able to use 15 student financial aid months for another degree after the Master's degree, currently 9 months are available for this purpose. In the future, these nine months could no longer be used for a degree on the same level. More detailed effects on those who discontinue their studies, those who change their study field, and the degrees of pharmarcy, kindergarten teacher or polytechnic degrees have not yet been specified.


Social assistance and general housing allowance

  • Social assistance to be transferred to Kela

The Government decided that the payment of social assistance will be transferred from social offices to Kela. This is expected to take place at the beginning of 2017. The aim is to increase equality in the processing, usability and resourcing of social assistance.

  • Protected portion for general housing allowance 

From the beginning of September 2015, a protected portion will be introduced for general housing allowance. A protected portion means that a small increase in income does not decrease general housing allowance immediately. Therefore, a protected portion will better take into account students covered by general housing allowance who have additional income occasionally.


Student housing

  • Investment assistance  

Investment assistance for special groups, including student housing, was increased by EUR 20 million, which is a significant increase compared to the current allocation of assistance.

  • Deductibility of the interest on interest-subsidy loans for student and youth housing

Another improvement on the construction of student housing is that the deductibility of the interest on interest-subsidy loans for student and youth housing will be lowered from 3.4 per cent to 1 per cent during this and the following year. As a result, student housing construction will be in a similar position in terms of funding with other rental housing projects. This has also been a common goal of HYY and HOAS.

  • Allowance for compensating rental expenses for student housing companies

The allowance for compensating rental expenses for student housing companies will be discontinued altogether, which is a significant deterioration. The cut will be a major deterioration on HOAS finances, but its precise impacts and the entry into force are not yet known.