Janakkala’s early-year finances close to target – end-of-year risks in tax revenues and unemployment development
The finances of the municipality of Janakkala in the first half of 2026 have been realised almost in line with the revised budget. The municipality’s and Janakkala Vesi’s combined operating revenues were 51.4 percent and operating expenses 49.7 percent of the full-year budget at the end of June. The spring measures to balance the economy are not yet much reflected in the June outcome.
The result for the January–June accounting period was a deficit of approximately €0.2 million. The result was clearly better than in the corresponding period last year, but it includes about €0.6 million of one-off income from the incorporation of Janakkalan sote-kiinteistöt Oy. According to the adjusted budget approved by the council in June, the full-year result is estimated to be a deficit of approximately €1.2 million.
– The municipality’s finances have developed in the right direction. In the original budget for 2026 a result of -€2.6 million was forecast. Because the deficit is now smaller in the forecast, this indicates that the adjustment measures taken have been necessary. According to the forecast the municipality’s finances will, however, still remain in deficit (approx. €700,000) and there are still uncertainties related to developments for the rest of the year. Therefore we cannot compromise on fiscal discipline, chief executive Riikka Moilanen states.
Operating revenues concentrated in the early part of the year, expenses close to the budget
Revenues have been increased by, among other things, capital gains from plots and the Virala campsite, income from timber sales and rental income from properties leased to the wellbeing services county.
The implementation of operating expenses was very close to the half-year target. In particular, purchases of services have been realised more slowly than budgeted. A short winter reduced, for example, snow-clearing costs, and savings have also been realised in meal, cleaning and specialist services.
Personnel costs were above the target at the end of June. The savings effects of the co-operation negotiations that ended in spring are not yet fully visible in the figures for the start of the year. The June outcome is increased by holiday pay that is paid in full at the end of June. In addition, municipal sector salaries will be raised at the beginning of August.
The tax revenue forecast has weakened from the spring estimate. In the revised budget tax revenues are estimated to amount to €42.79 million. According to the updated forecast in June the collection would remain at about €42.52 million, i.e. about €275,000 less than the budget.
– During the spring the tax forecasts have been positive for the municipality, and consequently the council also decided on a budget amendment for tax revenues in June. The most recent tax forecast at the end of June was weaker than earlier and reflects tax disbursements. On this basis the year-end forecast for tax revenue has been reduced, says finance director Juha Halen.
The general economic situation complicates predictability
Population development has been positive at the start of the year. Janakkala’s population was 15,896 at the end of June. In the second quarter the population grew by 44 people, mainly due to migration between municipalities.
Janakkala’s unemployment rate is still below the regional average. The share of unemployed in the workforce was about 9.5 percent in June, while in the Hämeenlinna sub-region the share was 11.6 percent and in Kanta-Häme 11.7 percent. The number of people on temporary layoff has also decreased from a year earlier. Youth and long-term unemployment have increased. The unemployment rate among under-25s was 19.1 percent in June, compared with 17.8 percent a year earlier. There were 257 long-term unemployed, i.e. 33 more people than a year earlier.
– The cost responsibility for high unemployment in municipalities will increase further as a result of legislative changes. Tight financial management must therefore be continued resolutely and with a long-term perspective, chief executive Moilanen continues.
There is uncertainty related to developments in interest rates and prices. Inflation was 2.1 percent in June, and the six-month Euribor had risen to about 2.6 percent. Rising interest and energy prices may increase the municipality’s costs during the rest of the year. During the remainder of the year the municipality will monitor in particular the development of tax revenues, the realisation of personnel costs, the employment situation and the progress of investments. A more detailed interim report will be presented to the municipal executive and the council in September.
Municipalities and joint municipal authorities report a forecast of the financial year’s result (KTPE) to the State Treasury during the financial year in August. The forecast is formed from municipalities’ and joint authorities’ budget data, which include known changes in income and expenditure at the overall economy level.
Municipal financial data can be explored here. (In Finnish)