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Home NATIONALPM downplays effectiveness of EMU buffers
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Mon, 31 Aug, 2015 12:07:24 AM
FTimes – STT Report, Aug 31
 
Prime Minister Juha Sipilä talked to Yle in Prime Minister's interview at his official residence Kesäranta on Sunday. Photo – Lehtikuva.
Prime Minister Juha Sipilä is not entirely convinced about the impact EMU buffers will have in the government’s attempt to boost competitiveness.
 
Talking to the national broadcaster Yle at the Prime Minister’s Interview on Sunday, the premier said the employers’ contribution reduction mechanism will not necessarily prove effective in the current situation.
 
According to Sipilä, EMU buffers could improve competitiveness by 0.4 per cent against the 5 per cent target.
 
The EMU buffers are collected into two buffer funds created in the occupational pension scheme and the unemployment insurance system.
 
Reduction in employers’ contributions is one of a few concrete means which Sipilä said could possibly be used to improve competitiveness.
 
Earlier, in an assessment, Suomen Keskusta (Centre Party) parliamentary group chair Matti Vanhanen said the reduction in employers’ contribution to cover an increase in VAT could cut consumption too much and affect small- and medium-sized enterprises.
 
Similarly, trade unions have underlined that the level of current contribution has been agreed for the period until 2019.
 
The problem lies in the recent failure to initiate negotiations for a new social contract, said Sipilä.
 
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