"It is gradually becoming clear, that we are in a deep economic crisis. Normal measures will not suffice — we need to move to a new stage," he said.
"Finland has been living absolutely beyond its means since 2007," said President Niinisto, who took office in 2012 and is a member of the liberal-conservative National Coalition Party.
"Wherever cuts are made, it doesn't matter, in someone’s opinion they will always come from the wrong place," said Niinisto, commenting on public protests against cuts to the education budget, which were held in June in Helsinki.
Thousands gathered in the capital to demonstrate against plans to cut hundreds of millions of euros from the country's education budget, spanning from early childhood education to university level.
In response to speculation that the increase is a consequence of spurious fears of a Russian invasion, Finland's Defense Minister Jussi Niinisto asserted that the increase was not related to preparations for armed conflict, but "rather an up-keep of learned military skills."
"This year we are training 18,000 reservists, which is already a satisfactory level. This is not a question of any war preparation," said Niinisto.
Military service is compulsory in Finland and lasts between 165 and 347 days. Reservists can later be called up for refresher courses, which last from five to seven days.