How Finland's Nordic welfare state is coping with Covid-19

Like many other nations Finland relied on its government and public sector acting swiftly and communicating effectively. Jukka Aminoff FRSA explores the relationship between Finland’s economic model, levels of trust and compliance.

Finland is the 13th oldest democracy in the world and operates as a market economy with a Nordic welfare state model. This means Finnish people pay a high level of taxes but enjoy public services that are heavily subsidised or free at the point of need. High taxes always raise the question concerning business competitiveness but Finland has been described as a paradise for the capitalist. Indeed, Finland's Prime Minister, Sanna Marin, has described Finland as the American Dream, which exists in Europe.

Living in an egalitarian society – one of the most equal countries in the world – Finnish citizens tend to trust public institutions. Since declaring its independence in 1917, political leadership in Finland has been delivered through coalition governments where conservatives and left-wing parties have been able to share power.

Dialogue between government and opposition parties have worked during challenging times, including during the Covid-19 crisis. When the Covid-19 began to spread across Europe in Spring 2020, Finland was able to monitor the situation and to make decisions in advance of virus impacting. Ministers and government officials spoke to the public on a regular basis, making rapid decisions to respond to the unfolding crisis and advising citizens on safety. Transparency very quickly became a key priority with government ministers and officials using the media to communicate, inform and debate the issues.

Finland did not go to a full lockdown but restaurants, public venues, bars and discos, were closed accompanied by warnings emphasising safety and hygiene. Only 10 people could gather in a single time but people were allowed to walk outside freely and shops were open. People washed their hands and kept their distances, visiting shops quickly or ordering online. Meanwhile, those over the age of 70 had to stay in their homes not able to meet younger relatives. 

Citizen pride and levels of trust

During the lockdown, the Finnish business and policy forum (EVA) measured how proud Finnish citizens were about their home country. 86% said that it is a joy and privilege to be a Finn; 6% higher than in 2016. What is the reason?

Finland is a sparsely populated country and this has reduced the risk of the virus spreading. Some people escaped to their country homes for safety, while others even decided to move to the countryside. Finland has also a wide range of public services, grants and social security; these safety nets enhance overall wellbeing and lower the possibility of social unrest. 

During the crisis, the public sector continued to function, practising science-based solutions. As Finnish people become more aware of the dangers of the virus, the overwhelming majority knew how they should change their daily behaviours to protect themselves. 

Of course, there have been social and economic consequences. Households, businesses, the public sector and the third sector have all felt financial challenges. The government has intervened in the economy with businesses receiving new grants and low rate loans. The third sector, which is not so heavily reliant on private money as it is in the UK, has continued to thrive in Finland as they have continued to receive funding from the government and municipalities.

The Finnish economy plummeted only 3.2% during the first quarter of 2020 making it one the best performing economies in Europe. Finnish companies were able to adapt to the new situation by increasing remote work and to increase safety measures in places where they had to meet people physically. Finland's economic is dependent on exports including electronics, pulp and paper, vehicles, minerals, iron and steel and chemicals. If demand from around the world decreases, Finland’s economy may continue to struggle between until at least summer 2021.

This summer the Finnish government lifted restrictions including opening restaurants, cafes, nightclubs and bars, and allowing gathering for over 500 people. Universities and schools are once again open. Travelling abroad was allowed. Some people seem to have forgotten that the crisis is not over and have brought the virus to Finland with them. Nightclubs and events have been full of people and some have been exposed to the virus.

Like the UK, there have also been challenges with testing with results not being delivered quickly enough. Only 30% of Finnish citizens are following the government's recommendation to wear masks and some people are not following the recommendations to stay in quarantine when they arrive in Finland. As a result, positive cases have been on the rise, with 24 new cases reported on 19 August. But when it comes to the number of deaths per 100,000 people, Finland is one of the leading countries in Europe.

While the risk of a second wave of infections is real, decision-makers have remained alert. Remote work is recommended in certain areas and policy-makers have the power to make quick decisions if the situation gets worse.

Why Finland has done so well?

Cooperation between citizens and the government has worked with public, private, and third sector actors taking recommendation seriously and acting quickly. Because of this and the scale of the public sector and the high-levels of transparency in the delivery of services, Finnish people have trust in the sector. In addition, Finland’s high levels of equality means that politicians and government officials are ‘near’ to citizens and are seen to share the burden.This applies to all Nordic countries to a greater or less degree and arises from long histories and a tendency to invest heavily in their citizens, with an emphasis on enabling every single citizen to succeed in life. This has embedded high levels of trust and compassion and a strong bond between Nordic governments and their citizens. 

While there are always exceptions, it also seems to be that high levels of trust results in Finnish people being more likely to follow rules and recommendations than other Europeans.  This speaks to wider issues around Finnish culture and this shapes how people behave. Other Europeans say that Finnish people are shy and barely speak. While this may be an exaggeration, Finnish people do listen and when you speak, you are not listening.

But the most important issue has been the government's approach to the pandemic, the way in which different sectors have been able to adapt to the new situation by following recommended policies and the trust that Finnish people had in these institutions. As the dust settles and we learn more about why some countries were able to protect their citizens and economies more than others, will other nations around look to learn from Finland and its welfare state model?

Jukka Aminoff is Distinguished Professor at Anglia Ruskin University and has written numerous articles about world affairs and economics to various publications, he has numerous advisory positions, and advised former Finnish Prime Ministers.