Pihlajalinna Oyj - Company Announcement

Pihlajalinna Plc:The government plans temporary legislation to limit outsourcing contracts

Pihlajalinna Plc Stock Exchange release 5 February 2016 13.45 EET

The government plans temporary legislation to limit outsourcing contracts

The Ministry of Social Affairs and Health and the Ministry of Finance prepare
temporary legislation to limit municipalities and joint authorities' social and
healthcare complete outsourcing contracts to be presented to the parliament as
soon as possible. The temporary legislation would be effective until the end of
2018 when the organizing responsibility of social and healthcare would move from
the municipalities and joint authorities to the independent regions.

The objective of the ministries is to safeguard the objectives of the social and
healthcare reform and to prevent the municipalities' own solutions with which
the municipalities have tried to control the rising of the social and healthcare
costs and to retain the local services.

Such solutions are for example large real estate investments and complete
outsourcings where the services are bought fully or mostly from a private
service provider with a long term contract.

In the release published by the ministries today it is stated that the
investments that improve productivity and are otherwise appropriate will be
secured.

Pihlajalinna Plc CEO Mikko Wirén: Social and healthcare reform is a massive
administrative reform. I hope that the constitutional legislation experts
evaluate the constitutionality of the temporary legislation. It would also be
justified that the ministries would genuinely explore the cost efficient
outsourcing models that can be fitted as a part of the national social and
healthcare reform preparation process. I'm pleased that the ministries release
confirms the fact that the current outsourcings contracts will continue without
interruption also after the social and healthcare refom enters into force. I see
no reason to forbid outsourcings which according to the effectivity research
have been found to create significant savings and operative productivity in a
short period of time.

The temporary legislation is still in preparation state and Pihlajalinna has no
information if its final form. It is too early to evaluate its impact to
Pihlajalinna business operations. Pihlajalinna will continue to monitor the
preparation of the legislation.

Further information

Mikko Wirén, toimitusjohtaja, Pihlajalinna Plc, 050 322 0927

Terhi Kivinen, SVP, Communications, Marketing and IR, Pihlajalinna Plc,
+358 40 848 4001, terhi.kivinen@pihlajalinna.fi

Distribution

Nasdaq OMX Helsinki

Key media

investors.pihlajalinna-konserni.fi






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