“Scandinavia has been very good at looking after people at the very bottom end of the wellbeing scale and that’s a combination of income and mental illness. The welfare state, the redistribution, enables that,” he says. Wealth, taxes and welfareLayoffs and recent cuts to unemployment benefits have made the situation “much worse over the last year”, […]
“Scandinavia has been very good at looking after people at the very bottom end of the wellbeing scale and that’s a combination of income and mental illness. The welfare state, the redistribution, enables that,” he says. Wealth, taxes and welfareLayoffs and recent cuts to unemployment benefits have made the situation “much worse over the last year”, he says. But Jan-Emmanuel De Neve, editor of the World Happiness Report, says these figures “hide huge inequalities” that affect wellbeing scores. The International Monetary Fund puts British GDP – the value of all its goods and services – at .73tn compared to Finland’s 9.99bn.Most Finns’ wealth hovers around the average GDP, whereas in the UK, the average is deceptively high due to a few people with lots of wealth. While Finnish inflation has generally trended a little below the UK over the past five years, it has pulled further down in recent months, with the UK recording a rate of 2.8% in February compared to 0.5% in Finland.Daniel Beech moved from Colchester to Helsinki in 2004 to live with his wife. “Trying to find work here when you don’t speak Finnish and don’t work in IT is a massive struggle,” he says.Sara Karpanen, 37, says adjusting to British work culture was the biggest learning curve she faced when moving from the town of Hyvinkaa, southern Finland, to London in 2013. Each parent is entitled to almost 23 weeks leave, paid using a complicated formula based on income. It means that a worker earning £25,000 a year is entitled to £53 each workday.Given the praise for its welfare system, you may be surprised to learn that one of its key components, healthcare, is not strictly free.Finnish media reports its right-wing government is instituting cuts to welfare benefits and social healthcare services.The Finnish government’s statistics agency says the average price (excluding new builds) in the last quarter of 2024 was £2,174 per square metre, rising to £4,130 for new builds.”So there are a lot of things that could make someone less happy,” Jan says.“There’s not as much of a class attitude as in the UK.”Darren says it took him a year to find a one-bed flat near London, competing against queues of other applicants to pay more than £1,000 a month.Redistribution is funded by some higher taxes. VAT is levied at 25.5% (versus 20% in the UK), social security payments amount to approximately 9.3% (compared to the UK’s 8% National Insurance tax) and income tax is split into six bands up to 55%, compared to four bands up to 45% in the UK. It rose to 9.5% in January, according to Statistics Finland, compared to 4.4% in the UK. “It’s undeniably so much better in so many ways,” says Kjartan Kelly, 31, a personal trainer who moved from Cardiff to Tampere, a city of around 200,000 in southern Finland, in 2020. “But over time I realised that you can actually trust the Finnish system,” the father-of-two says.Education is free at all levels in Finland. At university, this includes EU citizens who want to study there.”The work culture is definitely healthier than what it was like in the UK, that’s for sure,” he says, adding that better wages and workers’ rights allow people more free time. But for any Britons sold on the Finnish approach, it’s not always plain sailing. “They see opportunities, possibilities for themselves and their children and they all the time have the trust that if life does not go as planned you have welfare system and the social security system.”People living in Finland rated their life satisfaction 7.7/10 on average, compared to 6.7 in the UK, in a survey of more than 150,000 people in 147 countries. Critical to explaining why Finland is happier than the UK are differences in work culture, wealth distribution and the cost of living, according to experts, expats and citizens. She feels there is an expectation in the UK that employees “prioritise work over anything else” and a culture that “emphasises hustle”. Helsinki deputy mayor Daniel Sazonov says Finns have “seen and felt the benefits” of the Nordic welfare model (which ensures a high degree of access to basic services and a wide safety net) and this is reflected in the results of the World Happiness Report. He points to more generous holiday and parental leave entitlements.This works out at similar levels per head – £38,130 in the UK and £40,800 in Finland – because the British population is 12.4 times greater.Beyond housing, Darren found energy and food were roughly the same price in both countries, but transport has proved more expensive in the UK. So much more expensive was the cost of living that he told his wife, Elina, and their two children not to follow him, as had originally been planned. It’s the same price as the mortgage for his three-bed family home just outside the Finnish capital, complete with a large garden.Offices are mostly empty by 4pm “so there is enough time for you to have a life outside of work”, she says. Personal trainer Kjartan, who is in the process of buying a house, agrees: “Working at Finnish wages, it’s really not that difficult to do. You just need to work for a few years.””You always live a little bit on edge, like you never know is your job secure or is there going to be another increase in something?”Jan-Emmanuel says that once a country becomes as rich as Finland or the UK, GDP growth no longer translates into more happiness. “When I first moved to Finland, I always felt a little bit funny about having to pay higher taxes,” say Darren Trofimczuk, 47, from Tunbridge Wells, who lived in Jarvenpaa, near Helsinki, between 2012 and 2023. Each year he takes a 500-mile train ride from Helsinki to Rovaniemi for a Lapland fishing trip that costs £18.50. At rush hour, the 34-mile journey from Tunbridge Wells to London Bridge sets him back £31. Finland performs slightly better in terms of healthy life expectancy (HLE), which will affect happiness scores, says Jan-Emmanuel.Work culture By comparison, a dentist’s appointment in the UK costs £26.80, while prescriptions cost £9.90 per item and, of course, GP and hospital visits are free.Cost of livingFinland is the happiest nation in the world, according to a new report that shows the UK lagging behind in 23rd place. The UK House Price Index puts the cost of an average house at £268,548, but British statistics agencies have not published data by square metre since 2016.“You felt comfortable with [higher taxes] because the money would be reinvested so you felt much safer within the system,” said Darren adding the government funded his master’s degree.Recent spending cuts by the Finnish government have also contributed to rising poverty, says Jan, a former professor at City of London Polytechnic and Finland’s Abo Akademi University. He feels any money put away is just on “standby” mode to absorb the next financial shock, rather than plan for the future.”I’ve been shocked. Living in Finland for 11 years, it was always a much more expensive country. But it’s, I think, the other way around now.”Kjartan, a former British Army soldier, says Finnish employers feel a greater sense of obligation towards their staff, which he put down, in part, to the country’s mandatory military service.It must be redistributed in a way that serves people’s wellbeing, he says, whereas Keir Starmer and Rachel Reeves appear too focused on “growth for the sake of growth”.”Let’s say you start a company and you’re employing people, you’re going to be less likely to want to exploit your workers if you’ve been crawling through the snow and mud with them, all in it together. By Brad Young, Money feature writer“It’s not necessarily that Finnish people work less, I think it’s actually more that we work more efficiently.”
