Second interim report of the year published
The economy of Espoo is recovering from the COVID-19 pandemic. Although the operating margin deficit, or net expenditure, is assessed to be EUR 55 million weaker than predicted in the budget, accrued tax financing (taxes and central government transfers) is assessed to be EUR 84 million more than anticipated. The annual margin is forecast to be EUR 53 million better than budgeted.
Economy of Espoo
According to the July interim report, external operating income in January–July totalled EUR 214 million, which is 4.6% more than in the corresponding period last year. Operating revenues are forecast to be EUR 7 million more than budgeted.
External operating expenditure is also estimated to run over budget by EUR 66 million, a 7.6% increase from 2020. The overruns include COVID-19 related costs, such as sampling, tracing, personal protective equipment and vaccination costs, to the amount of EUR 59.6 million. In addition, overruns are predicted in the purchase of substitute care of children, housing for persons with disabilities, long-term care for the elderly, and mental health and substance abuse services. Furthermore, the increased number of long-term unemployed raises the costs of the municipal component of labour market subsidy.
The operating margin deficit, or net expenditure, is assessed to be EUR 55 million weaker than budgeted.
Tax financing (taxes and central government transfers) totalled EUR 1,134 million from January to July, and is anticipated to be EUR 84 million more than budgeted.
From January to July, the market value of Espoo funds grew by EUR 5 million as a result of support measures for economies recovering from the COVID-19 crisis, increased corporate earnings and positive expectations arising from the easing of the crisis. The funds’ revenue forecast has been raised to EUR 37.6 million for 2021.
The annual margin is forecast to be around EUR 190 million, EUR 53 million better than budgeted.
The result is forecast to be around EUR 4 million in the July situation.
The total amount of investments is assessed to be approximately EUR 350 million, and net investments approximately EUR 317 million.
Realisation of performance targets
A total of 41 performance targets were set for the year 2021. Out of the performance targets, 19 are expected to be achieved fully and six partially. For the three performance targets, it is not yet possible to make an assessment. Thirteen of the performance targets are not expected to be achieved by the end of the year. The overall picture appears challenging, in particular as regards the economic, employment and well-being targets, which are also the most affected by the COVID-19 pandemic.
More information on the interim report (in Finnish): https://www.espoo.fi/fi/talouden-seuranta