e-GOVERNMENT IN FINLAND - ePractice.eu

80. As noted in Chapter 2, the State budget, public administration reform and e-government in
Finland are all responsibilities of the Ministry of Finance, albeit within different departments. The
combination of decentralised ICT spending authority and divided oversight responsibilities within the MoF
means that a concerted effort is required to ensure sustainable and strategically allocated funding for egovernment
initiatives.
3.2.1 Budgetary environment
81. As a general rule, each agency decides on its IT spending in light of its operating appropriation. 18
The Ministry of Finance monitors progress on the use of IT in government through an annual survey,
which covers the types of system investments, spending on IT, pervasiveness of technology in ministries
and agencies and staffing, as well as current and proposed electronic services. The survey also asks
agencies for suggestions on future work such as on standard contract modules and security guidelines.
82. IT spending by the Finnish government takes place in a tight fiscal environment. After a round of
heavy budget cuts in the 1990s, the Finnish budget has stabilised with a target of maintaining central
government expenditure, in real terms, at 1999 levels. 19
83. Establishing e-government, however, requires up-front investment expenditures, not only in IT
systems, but also in personnel and training, and increasingly, in outsourced services. As in many OECD
countries, overall IT spending by the Finnish government is increasing (Figure 3). Between 1996 and 2001,
IT spending increased on an average of over 13% a year. The nature of spending, however, is changing.
Spending on hardware and software purchases has declined as a share of overall total spending, while the
amount spent on purchasing services and rental and leasing have steadily crept up. Wages and salaries have
been relatively steady. New usage patterns, on the other hand, may also be reflected in increases for costs
such as data transmission services, which, at an average growth rate of about 15%, have outpaced overall
growth in IT spending.
18 For a more detailed discussion of the Finnish budgeting system, see OECD (2002), Budgeting in Finland, Report to
the Public Management Committee, [PUMA/SBO(2002)8/FINAL]
19 In fact, however, spending has grown by 1% of GDP in real terms.
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