Increases in discretionary government grants for the repair of private roads

On 8 December 2022, the Government issued a decree on temporarily amending the Private Roads Decree for 2023-2025. During these three years, private road cooperatives may receive discretionary government grants for such purposes as improving private roads at a higher rate than at present.

Inflation and the energy crisis have increased the repair costs of private roads significantly in recent years. Under the National Transport System Plan for 2021-2032, the state will increase the rate of discretionary government grants for private roads. The Government Programme also states that appropriations for the basic repair of private roads will be ensured and that the repair debt of the lower road network and private roads must be reduced.

The amendment aims to encourage private road cooperatives to improve and repair private roads and reduce the repair backlog. A well-maintained network of private roads improves security of supply and facilitates the transport of domestic timber, which is stacked on the verges of private roads, to the forest industry and energy production sites.

The maximum amounts of discretionary government grants will increase as follows:

- ordinary road improvements 50% → 70%

- key bridge projects 75% → 85%

- unplanned repairs caused by natural conditions 75% → 85%

- ferry sites and annually dismantled bridges 80% → 85%, at least 80%

- winter roads 65% → 70%

The Private Roads Decree supplements the Private Roads Act with more detailed provisions on discretionary government grants for the construction and maintenance of private roads, application procedures and payments.

Finland has 370,000 kilometres of private roads. They connect an estimated 30,000 businesses, 40,000 farms, 250,000 homes, 190,000 holiday homes and a large number of forest holdings to the public road network. While the owners are primarily responsible for financing private roads, the state and municipalities support their maintenance.

What's next?

The Decree will be valid from 1 January 2023 to 31 December 2025. Private road cooperatives can apply for discretionary government grants from the Centres for Economic Development, Transport and the Environment. The new Decree will also apply to pending government grant applications received in 2022 for projects where the work has not yet begun.

Parliament decides annually in the Budget on the amount of financing allocated to the improvement of private roads. Based on the Government's budget proposal, the appropriation for 2023 would be EUR 23 million, plus deferrable appropriations from previous years amounting to approximately EUR 44 million (non-earmarked appropriations).

Inquiries:

Susan Hindström, Ministerial Adviser, tel. +358 295 342 104, [email protected]