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Filip Mishevski August 9, 2021 4 min read
Veikkaus’ Revenue May Be Redirected to Finland’s State Budget
Finnish national betting agency Veikkaus recorded a drop in its revenue, which caused a negative influence on Finland’s science, sport, culture, youth work, health and social welfare sectors. That is why Antti Kurvinen, the Minister of Science and Culture, thinks the income of Veikkaus should be distributed differently, thus transfer it to the state budget.
Proposed Veikkaus Change Would Be Put in Effect in 2024
Kurvinen stated on Saturday that Veikkaus’ income is declining and that, if a change is not made, groups that benefit from its activity, including charities, will also have a negative income. According to Kurvinen, who just took his current position in May, the changes in the distribution of Veikkaus’ revenue should be put into effect in 2024, a conclusion he reached after researching the issue with entities that benefit from gaming.
Talking to the Finish news agency STT, Kurvinen stated that his solution would be to transfer the income from Veikkaus to the state budget at the beginning of 2024. As a comparison, he told the media that Alko does the same thing as its dividends and income are a part of the state budget and used for good purposes.
Erkki Liikanen, the former Bank of Finland Governor, also shares the same view on the situation, per Kurvinen. Liikanen proposed a reform that will direct gambling revenue a general government fund and include the beneficiaries to Finland’s budget framework procedure.
Redistribution of the Income Would Result in Cash Flow Predictability
The drop in revenue that Veikkaus experienced is caused by a decline in slot revenue due to COVID-19. That’s the same picture that is being seen everywhere. One of the gambling capitals of the world – Macau, is also trying to find solid ground. This is also accompanied by measures that are taken to make sure that people do not become addicted to gambling.
Kurvinen’s opinion on the situation is that if reform does not occur, a situation where all of the beneficiaries from Veikkaus’ income will end up with a decline in revenue. Redistributing the income to the state budget would result in cash flow predictability and that is very important for its beneficiaries. Kurvinen also noted that in recent years, Finland has found itself in a strange situation because the success of a gambling company determines the resources for Finnish sectors such as sport or high-level research.
Politicians Might Become Too Powerful
The only problem with this redistribution is the fact that funding all of the Veikkaus beneficiaries would depend on the decisions by politicians. Kurvinen does not deny that the role of decision-making by politicians would greatly increase, but, according to him, that is a lesser evil than the one that lies in uncertainty cuts in funding.
In the long run, making political value decisions would be less problematic than the one where the success of Veikkaus determines what opportunities lie for young researchers in Finland. Kurvinen was also asked about reforms to the Lotteries Act, although he declined to answer.
Kurvinen only stated that determining where revenue from betting is distributed and where slots are located, what is the law on the lottery, etc., are totally different questions. In highlighting Alko’s operations, he pointed out that the company holds a monopoly on the market and Kurvinen thinks it and Veikkaus are almost the same in terms of how both companies offer products that lead to suffering if they are excessively used and that is why they should be treated the same.
The profits from Alko are not subject to health care, social, or substance abuse education costs, but go to the state budget. He also pointed out that a parliamentary working group was agreed to be set up it will discuss the distribution of Veikkaus’ income.
Since the issue concerns other ministries, not just the Ministry of Education and Culture, the office of the Prime Minister is responsible for navigating the problem.
Kurvinen concluded that even though it is still not too late, time is running out. He thinks a working group should be set up as quickly as possible to explore the idea.