Mayor’s budget proposal for 2027: Balancing expenditure growth while investing in learning

In the proposal, the city’s operating expenditure amounts to approximately EUR 1.53 billion, which is 2.7% higher than the 2026 forecast. The budget proposal is guided by the Espoo Story and the goal of halting the growth of per-capita debt and returning it to the end-of-2025 level by the end of 2029.

The economic outlook remains uncertain. For example, tax revenues and land sale revenues are expected to be lower than previously forecast. Both are highly dependent on Finland’s economic situation, and its development will also affect the city’s ability to achieve its budget-balancing targets.

“The budget proposal will halt the growth of per-capita debt, but it does require difficult choices and savings, also in staff costs. Fortunately, as the capital of children and youth, we are still able to make additional investments in learning,” says Mayor Kai Mykkänen.

The operating expenditure for education will increase by approximately EUR 14.2 million compared to the 2026 forecast. Additional funding will be allocated to changes in the pupil structure, increasing the number of places in general upper secondary schools, and strengthening literacy.

It is proposed that the monthly additional fee of EUR 50 per child collected from families whose children attend service voucher day care centres be removed. This change would reduce costs for families using service vouchers and cost the city approximately EUR 1.4 million.

Expenditure on employment services will increase by approximately EUR 7.9 million compared to the revised 2026 budget allocation scheme. The increase is related to unemployment benefits, training programmes, coaching services and financial support.

Not all services will receive additional funding. Expenditure on cultural services will be reduced by approximately EUR 1 million through savings in staff, facility and service costs.

In the budgetary framework for 2027–2029, the city aims to reduce its borrowing needs by approximately EUR 222 million in total. The goal is to achieve a permanent annual reduction of around EUR 68 million in borrowing needs.

Investments of approximately EUR 28 million planned for 2026–2029 will be postponed because of changes in project schedules. For example, the following projects will be postponed: Niipperin päiväkoti by three years, two day care centres in Olari by two years, and Laurinlahden koulu ja päiväkoti and Kurttilan koulu by one year.

In terms of staff costs, the city is aiming to achieve savings of approximately EUR 7.3 million in 2027 and EUR 9.7 million by 2029. Following the autumn 2026 cooperation negotiations, it is estimated that 80 employees will be made redundant. In addition, 60 positions would be eliminated through retirements, the expiry of fixed-term contracts and the elimination of vacant positions. The number of employees to be made redundant may still decrease if other work can be offered. At the same time, the organisation will be developed to better serve Espoo residents.

“In these times of change, we need good leadership, dialogue and cooperation. Our staff are the city’s most important resource, and we want to take care of their wellbeing in this challenging situation,” Mykkänen says.

In the proposal, the municipal income tax rate will remain unchanged at 5.3 per cent. It is proposed that the real estate tax rate for unbuilt sites be increased from 4.43 per cent to 5.00 per cent.

The City Council will decide on the 2027 budget at its meeting on 3 December 2026, starting at 16:00.