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Sitra ready to fund personal budget pilots

A review by the Social Legislation Working Committee has found a case for drawing up test legislation to allow for the piloting of personal budgets. In light of this Sitra has reaffirmed its commitment to fund and support these pilots in a number of local authority areas.


Tuomo Melin

Leading Specialist, Social and Health economist, The Finnish Innovation Fund Sitra


Test legislation allows practical piloting

In April 2012, Sitra proposed test legislation on personal budgets for social and healthcare services. A personal budget would increase patients’ and their carers’ decision-making power, their autonomy and freedom of choice for obtaining services – all designed to make everyday life easier. A personal budget would also allow users to source other services, such as rehabilitation, glaucoma follow-up, mammography services and support for disabled people. The potential for implementing a personal budget system for family care was surveyed in a project funded by Sitra in Tampere.

Tuomo Melin, a leading specialist at Sitra, explains the thinking behind the scheme: “A personal budget represents a new way of operating that emphasises the role of the public in service development and as the best experts in their own lives. The public should be encouraged to make decisions for themselves. If citizens live their lives without the opportunity to decide, they learn not to make any decisions.”

“Drawing up test legislation on a personal budget would be a clear, practical message from political decision-makers to reinforce the position of citizens and decision making in service production. No more festive speeches, reports and considerations – what we need now is test legislation on a personal budget. Sitra is prepared to fund municipal piloting,” says Melin.

A personal budget – autonomy and freedom of choice?

The concept of a personal budget refers to a model in which the customer chooses the service providers and services that he or she wishes to use. A personal budget is granted on the basis of a means test carried out by public social and health officials to determine a requisite care and service plan. The customer’s needs must be converted into a budget, i.e. an allotted sum of money that the customer may then use to purchase care or appliances.

The aim is that customers can decide where and when to buy services. Through their selections, customers can influence the content of their care and services. The services offered by local authorities, organisations, commercial enterprises or even neighbours could be used. The approach is based on giving customers the power to control their lives. Responsibility for their own budget provides the customer with the choice to select services which helps them to live an independent life and operate as an autonomous member of society in all walks of life.

Widening choice, promoting equality

Sitra’s starting point is that all citizens must have freedom of choice, irrespective of their income. Personal budget specification and pricing emphasises citizens’ equality and freedom of choice.

The content basis for test legislation on a personal budget would be that:

  • The personal budget system will not remove the obligation of the municipality to offer care services;
  • All citizens and customers have the right to a personal budget regardless of their income;
  • The well-being of the customer must not be endangered;
  • The customer has the right to decline a personal budget. The concept of a personal budget is understood in a wide sense to enable the purchase of many different services to best meet the customer’s needs.

In the approach, the municipality would decide on:

  • the personal budget’s implementation;
  • its application to different customer groups;
  • monetary value and computing formula.

The customer has no subjective right to a personal budget. The municipality will decide on the introduction of a personal budget, and on the services included. In test legislation, no customer groups should be excluded from the personal budgeting system. Municipalities must have the option to decide which customers a personal budget is offered to. However, municipalities should not grant the customer a personal budget if:

  • the customer is unable to independently obtain services crucial to their well being;
  • the customer misuses their personal budget;
  • the operating capacity of the customer or their caretaker weakens to a significant extent.

In addition, the customer’s urgent care and care independent of their will should be excluded from test legislation on a personal budget.

More information: Tuomo Melin, Leading Specialist, Sitra (, tel. 040 183 4158)

Download PDF: Personal budget: a customer-oriented model of operations in family care (Finnish only) by Mari Patronen, Tuomo Melin, Minna Tuominen-Thuesen, Eeva Juntunen, Sirpa Laaksonen and Wilhelmiina Karikko. Sitra 298, Publisher: KL-Kustannus Oy, Helsinki 2012

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