Indirect public administration

Indirect public administration comprises organisations which are not authorities, but which carry out public tasks or execute public powers. Indirect public administration, which functions under the supervision of the Government and ministries, is termed indirect State administration.

Indirect State administration supplements and supports the authorities in managing the tasks of the welfare society. Although the organisations of indirect State administration are not part of the actual State administration, they carry out statutory public tasks and, in some cases, execute public powers. In accordance with the Constitution, tasks involving significant execution of public powers can only be delegated to public authorities.

There are an average of fifty units of indirect State administration operating under Government supervision in Finland. Their size varies from large pension institutions to small fishery and reindeer herding associations.

Indirect State administration organisations can be categorized according to their task or legal position.

Indirect State administration categorised according to task:

• Units carrying out public administrative tasks, such as inspection, supervision and decisions on permits and financing, e.g. game management districts, which are authorised to issue hunting licences
• Units carrying out public services, such as services related to the maintenance of welfare services or expert services, e.g. forestry societies and the Central Organization for Traffic Safety in Finland
• Units operating on the markets, e.g. the Finnish Slot Machine Association (RAY)

Indirect State administration categorised according to legal position:

• Independent institutions under public law, which have their own budget, e.g. the Central Pension Security Institute
• Associations under public law, to which legislation gives the authority to carry out public tasks, e.g. forestry societies and fishery associations
• Limited companies, associations, foundations, etc., executing public powers or public duties, e.g. Veikkaus (the lottery organisation) and companies carrying out motor vehicle inspection.

The importance of indirect State administration increased in the 1990s, as the functions of the State were corporatised and privatised. Indirect administration has played a significant role as the production of public services has been dispersed and reformed to meet the requirements of customers in an improved capacity.

In addition, EU membership has resulted in new applications of indirect State administration in, for instance, technical inspection and supervision activities.

Transferring public powers and the management of public tasks to indirect State administration aims at increasing the independence and flexibility of the operations of organisations on this administrative level.