HELSINKI \u2014\u00a0The significant spending increase sought by Finland’s Armed Forces Command (AFC) is unlikely to happen in 2016 as the newly elected center-right government grapples with how\u00a0to reduce a hefty budget deficit and re-energize a recession-hit economy<\/p>\n\n\n\n
Although government parties the Center, National Coalition and the Finns favor raising defense spending against a backdrop of growing aggression by Russia in the region, the fiscal priority is focused on using new <\/span>austerity -driven <\/span>measures to cut the projected US$6 billion budget deficit in 2016.<\/p>\n\n\n\n “The budget for 2016 is unsurprisingly tight, and savings will be looked for in all core areas of spending,” Finance Minister Alexander Stubb said. Finland’s overall debt burden is forecast to increase to $121 billion in 2016. The government is aggressively pursuing public spending cuts of $1 billion to $1.5 billion.<\/p>\n\n\n\n The armed forces Finnish Armed Forces (FAF) <\/span>has seen a steady decline, in real terms, in its annual budgets since 2006. The military budget accounted for 1.4 percent of GDP in 2006, dropping to 1.34 percent in 2014 and . The budget fell to <\/span>1.28 percent of GDP <\/span>in 2015 when total defense budget <\/span>spending slumped by about\u00a02 percent to $2.9 billion.\u00a0<\/p>\n\n\n\n For 2016, the government will ask the military FAF <\/span>to proceed with further cost-savings measures to free up capital that can be channeled into core operating areas while bolstering procurement spending capacity.\u00a0<\/p>\n\n\n\n The government is expected to require the armed forces FAF <\/span>to find $80 million to $100 million in savings on military staff and administration functions alone in 2016. Additional capital savings are to be transferred from non-core functions to operating units, materiel procurement, and conscript and reservist training.<\/p>\n\n\n\n “Transferring monies from one area to another is counterproductive. Bolstering materiel investments while cutting back on operations is also foolish,” Mika Oranen, chairman of the Finnish Non-Commissioned Officers Union, said. (FNCOU \/ Aliupseeriliitto).<\/span><\/p>\n\n\n\n The armed forces\u00a0made its case for a substantial real increase in the 2016 budget on the grounds that apart from force modernization, readiness capability and training costs, its the organization\u2019s <\/span>economic situation needed to improve ahead of future big-ticket expenditures to replace on the replacement of <\/span>the Air Force\u2019s 60 F\/A-18 Hornet jets and the Navy\u2019s core surface fleet.\u00a0<\/p>\n\n\n\n Defence Minister Jussi Niinist\u00f6 has offered assurances the FAF the assurance <\/span>that the existing level of spending on conscript and reservist training will be maintained.\u00a0<\/p>\n\n\n\n However, the cutbacks could restrict\u00a0negatively impact on <\/span>force training and exercise\u00a0budgets, reducing the active role of high cost use <\/span>equipment costly to use<\/span>, such as F\/A-18 Hornet multi-role <\/span>fighters and NH–<\/span>90 tactical troop transport helicopters, in future operations and exercises.\u00a0<\/p>\n\n\n\n “Training of Finnish conscripts and reservists will not suffer. Next year’s budget ensures 2.5 training staff for every conscript unit. Additionally, we intend to maintain our reservist training levels at 18,000 participants every year,” Niinist\u00f6 said.<\/p>\n\n\n\n Notwithstanding, Niinist\u00f6 has yet to outline whether the savings <\/span>cuts sought will be limited to 2016\u00a0or will <\/span>extend over the period of the present government\u2019s four-year term in office, which ends in 2019.\u00a0<\/p>\n\n\n\n If this is the case, then the military FAF <\/span>is facing static annual budget levels and added pressure to reduce its operating-base cost levels up to 2020.<\/p>\n\n\n\n The projected level of funding in 2016 and up to 2020 will also fall short of a recommendation to government by the Parliamentary Defence Committee (PDC),\u00a0which supports a program of spending focused on modern equipment and bolstering the armed forces’ FAF\u2019s <\/span>war-time strength from 230,000 closer to its previous level of 350,000 trained soldiers.<\/p>\n\n\n\n