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HELSINKI, Sept 16 (Reuters) - The Finnish government agreed on Wednesday to 2021 budget spending of 64.2 billion euros ($76.1 billion) and a deficit of 10.8 billion euros, below an updated estimated 2020 deficit of at least 17.6 billion euros.
The centre-left government, which previously estimated a 2020 deficit of at least 18.9 billion euros due to the coronavirus crisis, said it was spending to pay for related expenses and to boost recovery by increasing employment, while sticking to its goal of becoming carbon-neutral by 2035.
"The government's budget proposal is reflationary in its entirety," Prime Minister Sanna Marin told reporters.
The additional spending means that Finland's public debt will rise to above 71% of its gross domestic product this year and near 75% in 2022, from 59.4% in 2019, Bank of Finland estimate showed.
In absolute terms, Finland's central government debt will rise to an estimated 135 billion euros by the end of 2021, the government said, from nearly 125 billion at the end of August 2020.
"Health, work and protection, that is what next year's budget and the government's work in general is about, Minister of Science and Culture Annika Saarikko said.
The government said it would seek to balance the budget over the longer term, particularly by investing to create at least 36,000 new jobs by the end of the decade.
Measures to increase employment include extending the compulsory education age to 18 from 16, lowering day care costs and offering better jobseeking services, while applying for new jobs will become obligatory to receive benefits, it added. ($1 = 0.8440 euros) (Reporting by Anne Kauranen; Editing by Kevin Liffey and Alexander Smith)
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