2023 budget approved by the City Council
The City of Tampere budget for next year and the economic plan for 2023-2026 were approved by the City Council on 14 November 2022. The budget serves to ensure the city's functional capacity and continue development of the city as an attractive destination.
The city's operating expenditure for 2023 is estimated to be EUR 1.081 billion. In 2023, the budget's annual margin will be EUR 126.9 million and the profit for the financial year will be in balance, i.e. 0.
The budget responds to the increasing need for services, rising costs and the impacts of the health and social services reform. The City Council set the income tax rate for 2023 at 7.61% (currently 20.25). Due to the health and social services reform, municipal tax rates in all municipalities will be cut by 12.64 percentage points, and central government taxation will be similarly tightened in 2023.
By decision of the City Council, the City's real estate tax rates will remain unchanged. In 2023, real estate tax revenue is estimated to be EUR 98.5 million. The City Council set the general real estate tax rate at 1.25%. The real estate tax rate for permanent residential buildings is 0.65% and for other residential buildings 1.10%. The real estate tax rate for an unbuilt construction site will be 5.00% next year, 0.40% for non-profit organisations and 3.00% for power plants.
It is estimated that tax revenues will amount to approximately EUR 630 million in total next year. There will be major fluctuations in the development of tax revenues in Tampere due to the health and social services reform during the economic planning period 2023-2026, which is why the assessment of municipal taxes and corporate tax revenues is problematic. Overall, tax financing (tax revenues and central government transfers) is expected to decrease by about 55% next year compared to the current forecast. Net expenditures are estimated to fall by about 58% (August forecast) from the current year. As a result of the health and social services reform, the municipalities' share of municipal and corporate tax will be significantly reduced. The corporate tax share is expected to remain unchanged next year, with a total of EUR 90 million for the current share.
Investments are to be made without additional debt
Tampere's investment need and level will remain high in 2023. The total external investment expenditure of the city and unincorporated enterprises is EUR 222.2 million (net). Approximately 70% of this, or EUR 159.6 million, is allocated to building construction projects and civil engineering.
Investments are divided into new and additional construction (55%) and renovation projects (45%). Key investment targets include early childhood education and care and basic education buildings, for which approximately EUR 66.6 million is earmarked. EUR 29.1 million has been budgeted for cultural and leisure services buildings.
The income financing percentage of investments indicating the ratio between investments and the annual margin is 57%. Every effort is made to make the investments without additional indebtedness, with the aim being to cover financing needs with the sales of assets and cash. In 2023, assets are estimated to be sold for approximately EUR 29.9 million. If the sale of the City's real estate assets goes according to plan, the City's interest-bearing debt will not increase. The amount of loans per resident is expected to fall to EUR 3,728 next year.
Operations are steered by Tampere’s strategy
The Tampere City Strategy 2030 is the highest level document steering city operations, and it lays the foundation for the city's management and development. The objectives for the 2023 budget are drawn from the strategy each year. Achievement of these objectives is monitored in operational and financial reviews and financial statements. In setting the objectives, an effort has been made to take into account preparation of the economic and productivity programme, launch of the wellbeing services county, recovery from the COVID-19 pandemic and the effects of the Ukrainian war and general economic uncertainty.
Most of the targets set for the 2023 budget are in line with the targets for the current year. New objectives for next year have been set with respect to the use of intoxicants by young people and adults, bullying, loneliness, opportunities to exert influence, the development of residential areas and cleanliness of the city centre. In addition, some of the objectives or target levels have been revised in connection with business events, the physical activity of children, young people and adults, launch of the wellbeing services county and development of digital services.
City Council approved the non-binding resolution and text additions
The request for the 2023 budget by Mayor Anna-Kaisa Ikonen was approved unanimously by the City Council. The non-binding resolution states that the City of Tampere must ensure that the public transport price level, pricing equality, service level and network will continue to be such that public transport remains attractive to its users and its modal share will increase. The city must ensure that the pricing of public transport is made more equal throughout Tampere. At the same time, the attractiveness of public transport would contribute to achieving the city's climate objectives.
In addition, the City Council unanimously decided to add some text to the draft budget for different service areas, which was supplemented as follows: Regional equality is strengthened in basic education by taking into account the regional needs of positive special treatment. With regard to culture, well-being and health are systematically promoted in cooperation with the Pirkanmaa wellbeing services county, also taking into consideration the needs of the ageing population and informal carers.
The section on sports and youth was supplemented to take into account low income when setting the price for a special swimming card. Physical activity opportunities for the ageing population will be developed to maintain functional capacity and promote health, also taking informal carers into consideration. In addition, at the end of the Suburb Programme and activities of the Me-talo, the residents of the Peltolammi-Multisilta area will be allocated premises that safeguard the continuity of operations in cooperation with the city and actors in the area.
In the section on properties, facilities and housing policy, emphasis was added to the fact that the city promotes diverse housing options and communal housing for older people.
With regard to the Committee for City Planning and Infrastructure Services, the City Council supplemented the budget proposal: The report required by the City Council concerning the sparsely populated waterfront areas of Aitolahti and Teisko on possible changes in the use of holiday homes for permanent housing will be implemented during the current term of the City Council.
The City of Tampere 2023 budget in figures
The city of tampere 2023 budget in figures
|Population 31 December 2023||250 000 inhabitants|
|Income tax rate||7,61 per cent|
|Annual margin||EUR 126,9 million|
|Revenue||EUR 1,081 billion|
|Expenditure||EUR 1,081 billion|
|Result||EUR 0 million|
|Total investment (net)||EUR 222,2 million|
|Loan amount per resident||EUR 3728|