EFSF Bill Constitutionality 'Questionable'
Chancellor of Justice Indrek Teder has found: the draft legislation for joining the EU's bailout facility may be unconstitutional, as claimed by the Social Democrats.
In a letter to chairman of Parliament's finance committee Sven Sester on September 25, Chancellor of Justice Indrek Teder said that the "conformity to the constitution is questionable" - something the leading opposition party had alleged.
Teder said the constitution does not flat-out prohibit state guarantees from being given to the European Financial Stability Facility but that legislation sets forth requirements as to how it should be decided.
The current State Budget Act does not allow Parliament to delegate the decision to the government. Nor does the law permit guarantees to be given to a private company founded in Luxembourg, which operates the EFSF.
"Parliament must thus amend the State Budget Act," said Teder. "Due to the extraordinary nature of the participation in the EFSF I recommend relevant and clearly defined special provisions to be established in legislation."
He also said Parliament must retain effective oversight over the country's obligations if it authorizes the government.
Teder said the issue should be discussed in a full session of Parliament, thus affording effective control and ensuring that the public is kept informed.
The draft legislation goes before the Parliament for a first reading on September 27.
Social Democrats Eiki Nestor and Rannar Vassiljev of the finance committee earlier called for a halt in proceedings because of a conflict with the State Budget Act.
While calling for the Social Democrats to be heard out on the important issue, government officials such as Finance Minister Jürgen Ligi said it would be "embarrassing" for the pledge to contribute to European stability to be postponed. "I hope the Social Democrats are simply wrong in an ordinary sense," Ligi told journalists last week.