This week, authorities sent letters informing these students that their tax refunds -- which would have been paid on December 2 -- will be garnished to make up for excess benefits paid to students because their income was higher than expected, for instance.
The students had already agreed to a repayment schedule with Kela. Yet even if they had followed these agreements conscientiously, they have in effect been unilaterally overridden by Kela without advance warning, they argue. Furthermore, officials do not usually take the step of attaching an individual's income unless they have ignored previous letters urging them to pay -- which were not issued in this case.
Read the fine print
Kela lawyer Antti Partanen says the institution is beefing up its efforts to recover money owed to it because of overpayment of benefits.
He notes that there is a brief sentence in the fine print of each student's agreement noting that tax returns may be garnished to recover funds even if payments are made on time.
According to State Bailiff Juhani Toukola of the National Administrative Office for Enforcement, Kela skipped the normal step of sending a warning letter before attaching the tax refunds "in order to avoid hassle". As there are only a few weeks until tax refund time, he says it wanted to avoid the situation where a debtor might have repaid the full amount due but still had their refund garnished.
Following vocal concerns that some students could end up with a black mark on their credit records through no fault of their own, Toukola announced that the planned garnishing of tax returns in these cases will not be noted in official registries.
Professor: Morally dubious
Along with student leaders, those critical of Kela's decision include Risto Koulu, professor of procedural law at the University of Helsinki.
He told YLE that subjecting a student who has made payments on time to the garnishment procedure is morally questionable.
According to Koulu, the clause allowing Kela to confiscate tax returns makes no sense, as the whole point of the repayment agreement is to give the student time to pay off his or her debt.
"In juridical terms, Kela is quite right, but morally I consider this to be dubious, because these people certainly did not understand that there was this loophole," he said.
