Government proposal regarding housing allowance

By Styrelsen
16.10.2017

The National Union of University Students in Finland SYL believes that the Government proposal to make changes to the housing allowance, which was published today, will harm both students and society. The norm for housing allowance when renting part of a property, which is being proposed by the Government, would make shared accommodation less attractive and would reduce the housing allowance of Finns living in shared accommodation and in studio flats which are smaller than 20 square metres by up to 20 per cent. The proposed change to reduce the maximum housing costs for those renting part of a property would be particularly harmful to students living in shared accommodation in areas with low maximum housing costs. Even those offering student housing without aiming to make a profit, such as foundations for student housing, would not be able to offer all their shared properties at the price of the maximum housing costs.

“It has only been two months since the students were included in the general housing allowance, and it is incomprehensible that there are already attempts to reduce students’ housing allowance. The proposed change would push students to move to more expensive studio flats rather than more affordable shared housing. The proposed norm for housing allowance when renting part of a property will have an impact on students’ willingness to move into shared accommodation, especially as this option is already made less appealing by questions regarding the interpretation of households and cohabitation,” SYL’s President Riina Lumme says.

“In practice, this proposal will have the largest impact on students, as other low-income groups are able to supplement their reduced housing allowance through social assistance, which students are not entitled to. You could ask yourself: have the students not been punished enough? The 80% norm for housing allowance when renting part of a property will also affect shared student accommodation. There is already less demand for this type of accommodation since the general housing allowance was introduced. If these properties stay empty, society will lose out in two ways: on the one hand because state subsidised housing is underutilised, on the other hand because the Government is subsidising the higher rents that students pay on the open market through the housing allowance,” board member Jani Sillanpää states.

“At SYL we hope that the Government would find other ways to solve the problems relating to affordable housing that meets requirements than by punishing those on the lowest incomes. Introducing the norm for housing allowance when renting part of a property is estimated to bring savings of approximately 4 million euros per year. We suspect that through these measures, the Government will push students to move into studio flats. The proposal will very quickly have the opposite effect than what was intended, and housing expenditure will continue to grow if shared housing is not an affordable option for students. In this case, both students and society would suffer,” Lumme sums up.

Further information:

President Riina Lumme, 044 906 5007, riina.lumme@syl.fi

Social Policy Adviser Silja Silvasti, 041 515 2233, silja.silvasti@syl.fi