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Thousands protest against unemployment benefit cuts in Helsinki

HELSINKI (Reuters) - More than 7,000 Finns rallied on Friday in Helsinki to protest cuts to unemployment benefits, with strikes halting public transport in the capital and closing harbours and factories around the country.

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The demonstrators, mainly union activists, gathered outside the Government’s Palace and called on the centre-right government to revoke a new law that pushes the jobless to take on short-term jobs or risk of losing some of their benefits.

Around 200,000 industrial, transport and construction workers went on strike, and other unions encouraged their members to join the demonstration in Helsinki.

“My promise to you is, that when the Social Democrats (SDP) is in the government, we will cancel this,” Antti Rinne, the leader of the biggest opposition party, told the crowd.

Unions are powerful in Finland, and SDP has close relationship with them.

Finnish Technology Industries estimated that the one-day strike cost its member companies 230 million euros ($287 million) in lost revenue.

“Why isnt the metro, the busses or the trams running? They’re blocked by the left’s soapbox. Party politics from the 70’s”, Sampo Terho, minister for European affairs and leader of the co-ruling Blue Reform party, wrote on his Twitter account.

The Finnish economy has recovered from a slump and is now growing briskly. But at 8.4 percent, its jobless rate remains higher than unemployment in other Nordic countries, putting a strain on public finances and a generous welfare system in the face of an ageing population.

The government has sought to solve the fiscal problem with spending cuts, healthcare reforms and a 2016 labour reform pact, which cut workers’ benefits for the first time in a century.

The new “activation model” law reduces monthly unemployment benefit by 4.6 percent if claimants fail to do 18 hours’ work in three months and actively seek new employment. That violates the 2016 pact, unions say.

“The government has let us down. We agreed to the competitiveness pact with the condition that unemployment benefits stay untouched. And now they’ve done it anyway,” Jani Polla, a metal worker who had traveled from south-western city of Turku, told Reuters.

The government has promised to give more money for services to support jobseekers, noting that the activation model was part of a larger reform package which has been negotiated together with labour unions.

Reporting by Tuomas Forsell, editing by Jussi Rosendahl, Larry King