So far, the National Incomes Register, which was introduced at the beginning of 2019, has not reduced the administrative burden on employers. In the development of the Incomes Register, it would be important to consult the data providers, in particular, in order to make the reporting smoother and reduce the need for subsequent corrections.
The NAOF examined whether the Incomes Register has achieved the targets set for it. The objectives were, in particular, to reduce the administrative burden on employers and to improve the efficiency of the authorities by making income earners’ income data available to them almost in real time. All employers in Finland report data to the register, which is used by a large number of authorities and other organizations performing public duties. The data is used, for example, as a basis for determining taxation, pension and social benefits.
The introduction of the Incomes Register caused significant changes to the processes and information flows of income data processing. A particularly significant change took place in the work of payroll administration. As the Incomes Register has an impact on the activities of a wide range of stakeholders, the auditors wanted to hear the opinions of both the data providers and the data users.
The administrative burden related to reporting data is at least not considered to have decreased as a result of the introduction of the Incomes Register. The main reasons for this are that reports must be made more often than before, they have to be corrected retroactively, and the correction and reconciliation of data is considered difficult. The problems of reporting are also visible to the users of the data in the Incomes Register, particularly because there are such deficiencies in the accuracy and quality of the data that the users have to look into separately.
Although there have been problems with the use and introduction of the Incomes Register, the audit did not reveal any reason to question the rationale behind the Incomes Register. Some of the users of the Incomes Register have already been able to revamp and streamline their operations by means of the up-to-date information, and the Incomes Register in general is considered to have potential. In order to make as much use of the data in the Incomes Register and to reduce the administrative burden on employers, the income concepts used in the legislation on benefits should be unified when the legislation is reformed in the coming years.
- Financial administration
- Industries and employment
- Performance audit
- Central government finances, taxation and general government finances
- Communication and digitalisation
- Public administration and its development
- Public procurement and investments
- Social affairs and health administration
- Social security and benefits