The state pension scheme is managed and overseen appropriately. Other pension schemes, such as the pension for the self-employed and the pensions for agricultural entrepreneurs, impose significant liabilities on the state that have not been identified or reported as part of the final central government accounts.
The audit was targeted at the state pension scheme and central government liabilities in other pension schemes. The state pension scheme covers central government employees’ pension security, which is financed entirely by the central government. In addition, the central government fully finances the pensions paid by the Social Insurance Institution of Finland (Kela), such as the national pension and the guarantee pension, and contributes to financing the pensions for the self-employed (YEL), the pensions for agricultural entrepreneurs (MYEL), and the seafarers’ pensions (MEL).
In the future, the state’s commitment to different pension schemes will cause considerable expenses for the central government and thus constitute a significant financial liability.
Pensions are a significant annual expenditure item in central government finances. In 2021, they totalled around EUR 10.2 billion, accounting thus for around 15% of the appropriations in the state budget. The appropriateness of the information reported on pensions is also important from the perspective of the knowledge base of decision-making: the final central government accounts should provide true and fair information on the liabilities arising from different pension schemes.
The audit examined whether the pensions financed by the central government in part or in full are managed and overseen appropriately. In addition, the audit examined whether the final central government accounts provide true and fair information on the pensions for which the central government is liable.
Based on the audit, it is concluded that the pensions for which the central government is liable are managed and overseen appropriately. The liabilities arising from the state pension scheme have been reported appropriately.
However, the liabilities arising from other pension schemes have not been identified or reported as part of the final central government accounts. According to the National Audit Office, these liabilities should be identified and reported as part of the final central government accounts.
The final central government accounts are being reformed, and they will be prepared in the new form for the first time in 2024. The timetable is appropriate in view of the implementation of the recommendations: it is natural to take any changes into account in the overall reform of the final central government accounts.