The City of Turku controls 63 subsidiaries, of which 54 are consolidated in the consolidated financial statements. Of the consolidated subsidiaries, three are foundations and 26 are housing and real estate companies. There are 25 consolidated associated entities and three joint municipal authorities. Three subsidiaries and five associated entities have been consolidated through the sub-group of the Joint Municipal Authority of the Hospital District of Southwest Finland.
At the end of the financial year, the balance sheet total was EUR 1,927.7 million. The increase compared to the previous year was EUR 139.6 million (7.8%). The surplus for the financial period increased equity by EUR 39.0 million (4.8%). The equity ratio increased by 1.4 percent points, being 44.2% at the end of the year (45.6% in 2020 financial statements). A level that exceeds 50% can be regarded as the general target level for municipal economies.
The City’s liquidity remained good throughout the year. At the end of 2021, the City’s cash reserves amounted to EUR 83.2 million (EUR 139 million in 2020 financial statements), not including investments in the City’s own funds. Cash reserves decreased by EUR 55.8 million in 2021. The cash reserves consisted only of cash, deposits in a payment transaction accounts and other deposits. The level of the cash reserves has had to be lowered due to penalty interests imposed by banks, i.e., negative deposit fees.
The City's investment expenditure was EUR 140.8 million in 2021 (EUR 75.8 million in 2020). An adjustment of EUR -4.6 million to the acquisition expenditure of investments made in previous financial periods has been considered in the comparison data. A financing share of EUR 2.1 million (EUR 3.4 million in 2020) was recorded for the investment targets. EUR 33.8 million (EUR 24.4 million in 2020) in capital gains were recorded. The investment expenditure fell below the budget of EUR 29.4 million.
The operating cash flow was positive by EUR 67.3 million (50.2 in 2020 financial statements) The increase in internal financing was influenced by central government’s measures to support municipal tax funding as well as the good development of municipal tax and corporation tax revenue and compensation for land use agreement payments and proceeds from realisation of assets.
The internal financing adjustment items correct the capital gains from non-current assets, which are presented in the investment cash flow – as well as losses amounting to a total of EUR 32.1 million.
Revenue from central government transfers amounted to a total of EUR 306.3 million, being EUR 30.2 million (-9.0%) less than the previous year. In 2020 and 2021, the Government granted support to cover the impacts of the coronavirus pandemic. In 2020, the aid was paid through central government transfers, while in 2021 the aid was granted as grants.
Determination of Turku’s tax revenue
Basis for tax revenue
Income tax rate (%)
Property tax rate (%):
During the year, the coronavirus pandemic, which has continued for another year, had a strong impact on the operating environment. However, the impact of the prevailing economic trend on both the general economy and the economy of the Turku region was more positive than expected.
The amount of labour used in person-years (all personnel) during the period 1 January – 31 December 2021 was 10,781.3. The use of labour in 2021 was 10,464.3, excluding employed persons, pupils and trainees, participants of relocation experiments and disabled persons in subsidised work.
The turnover data specific to the Turku sub-region produced by Statistics Finland will be available until the end of September 2021. The effects of the coronavirus pandemic have been reflected in the development of turnover and number of employees in both the Turku sub-region and the entire country. The decrease in turnover in all business sectors that began in the second quarter of 2020 continued in the Turku sub-region in the first quarter of 2021. In early 2021, turnover in the region decreased by 3.9% (entire country -0.3%) from the same date in the previous year.
The City's current financial plan contains a lot of uncertainty. The financial plan was drawn up in the autumn of 2021 with the help of the information available at the time. The health care and social services reform will change the tasks and funding of municipalities from the beginning of 2023. There is still no detailed information available on the changes to the funding of municipalities.
After the municipal elections in June 2021, Turku City Council made a historic decision exactly one hundred years after adopting the city manager model, the Council elected a mayor and three deputy mayors instead of a city manager. Before selecting the mayors, the City Council decided to approve the Mayor’s Programme for 2021–2025. It is particularly important that all the delegation groups committed themselves to the Mayor's Programme.
The summary presents the main points of the city of Turku's 2021 financial statements.
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