In addition to the revenues and expenditures recorded in the budget, central government finances also encompass state-owned funds that are not included in the budget. The state has eleven off-budget funds in total. Based on their balance sheets, the largest of these are the State Pension Fund, the National Housing Fund, the National Nuclear Waste Management Fund, the National Emergency Supply Fund, and the National Export Guarantee Fund.

Central government finances = revenue and expenditure entered in the budget and off-budget state-owned funds

Central government finances are part of public finances. Public finances are formed by the general government, which includes the central government, wellbeing services counties, municipalities and joint municipal authorities, the Province of Åland, statutory earnings-related pension companies and institutions, and other social security funds. The Ministry of Finance is responsible for the management of central government finances in Finland.

The central government’s liquidity is comprised of three factors: cash management, borrowing capacity, and payment transactions.

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Efficient cash management provides an effective overview of revenues and expenditures. The central government has a cash flow forecasting system that all central government units must use to forecast their revenues and expenditures. Tax revenue forecasts are particularly important for revenue estimates, as the majority of the central government’s revenues are comprised of tax revenue.

When the central government’s expenditures exceed its revenues, it must cover the difference by borrowing the funds it needs. The central government can borrow to cover any deficits in the state budget (and repay any outstanding government debts). Such borrowing is reflected in both the revenue and expenditure flows from the central government’s cash register, as the central government has to pay interest on its debt. Ensuring an adequate borrowing capacity is a key part of the central government’s liquidity, as the central government’s annual need for gross borrowing is currently over EUR 40 billion. This borrowing capacity is reliant on responsible financial management, which is reflected in the central government’s high credit ratings.

Payment transactions allow money to be transferred to and from the central government’s cash register. The central government manages the incoming and outgoing financial transactions of the agencies centrally from the group accounts.

Cash management is a daily part of managing the central government’s liquidity.

The central government’s cash management typically involves sizable cash flows on a daily basis. These are related to, for example, debt maturities, payment dates of central government transfers to municipalities and wellbeing services counties, and tax revenue dates. In 2023, the central government’s cash register averaged EUR 5.3 billion per month. Its cash flows are subject to monthly and annual seasonal fluctuations due to timing differences in the central government’s revenues and expenditures.

In addition to large cash flows, the central government’s cash funds are deposited and invested on a daily basis. Central government cash and cash equivalents are deposited daily in banks and invested in low-risk assets. As a combined effect of its cash flows and short-term deposits, over EUR 1,000 billion passes through the central government’s cash register every year. 

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In matters related to central government finances, the State Treasury serves the central government, citizens, wellbeing services counties and the municipal sector as well as communities and companies. Using reports published in the exploreadministration.fi service and open interfaces/open data, all citizens can follow the use of tax revenues and examine, for example, the background of procurements.

Monthly reviews for central government finances

In addition to the data provided by the accounting units, the central government’s centralised accounting includes the monthly accounting data of off-budget state-owned funds. The calculations and reports of the data collected in the centralised accounts are reported in the monthly reviews for central government finances, which are available in the Exploreadministration.fi service.

Final central government accounts

The central government accounting units draw up their final accounts annually by the end of February. The final accounts comprise the budget realisation statement, income and expense account, balance sheet and appendices to the statements. The final accounts also include the annual report. The State Treasury compiles the account details of accounting units in the central government’s Central Bookkeeping and draws up the final central government accounts based on this data.

The State Treasury will present its proposal for the final central government accounts to the Ministry of Finance by the end of March. The final central government accounts are attached to the government’s annual report. The National Audit Office and the Parliamentary Audit Committee are responsible for auditing central government finances.

How are the final central government accounts prepared?

The final central government accounts are prepared in cooperation, but how should they be read and their tables interpreted? All the videos below correspond to these questions. These videos use examples from the 2022 final central government accounts.

Video: The final central government accounts are completed through collaboration (YouTube, in Finnish or texted in Swedish)

Video: Getting Acquainted with the Calculations and Tables in the final central government accounts (YouTube, in Finnish or texted in Swedish)

The State Treasury is responsible for the central government’s consolidated accounting and steers the implementation of the central government’s financial administration, procurements, and payment transactions by issuing orders and instructions to the central government’s accounting units. The State Treasury develops the state’s procurement process through digitalisation and increased cost efficiency. By participating in the tasks of the Hankinta-Suomi program, the State Treasury promotes the societal impact of the funds used for public procurements and the sustainability of public finances.

The State Treasury promotes knowledge-based management, produces data and analyses on public administration-related finances and develops the financial information services used by Finnish municipalities and wellbeing services counties. 

The calculations and reports of the data provided by the accounting units and collected in the centralised accounts are reported in the monthly reviews for central government finances, which are available in the Exploreadministration.fi service.

VISUALISED INFORMATION AND ANALYSES IN THE EXPLOREADMINISTRATION.FI SERVICE

The State Treasury also acts as the responsible authority for the online services for discretionary government grants and ensures the development and maintenance of these services and all user-related support. The central government’s grant services include three online services: Applyforgrants.fi, Managegrants.fi, Exploregrants.fi.

Were you unable to find the information you were looking for on this site? Do you have further questions about central government finances? Contact the State Treasury’s Communications Unit at viestinta(at)valtiokonttori.fi to find a suitable specialist who can answer your questions.