State budget to undergo first audit this spring

The "Superministry" complex in Tallinn. Source: Siim Lõvi/ERR

The Estonian government decided at its December 19 cabinet meeting that they should move forward with the proposal first floated last spring to audit the state budget. The goal of the audit will be to identify automatic but, in the government's opinion, unnecessary expenses in the state budget at the expense of which budgetary funds could be redirected elsewhere. The plan is to start auditing the state budget on a regular basis.

The goal of the audit will be to make the spending of taxpayers' money as efficient as possible, and free up funds in the state budget for the achievement of new goals that are important to the government. The government believes that an audit of the state budget will help shine a light on the relevance of state services and activities, which will help them make better reasoned decisions regarding what services and to what extent the state should offer.

The Ministry of Finance will submit an analysis together with proposals for the planning and use of the state budget to the government at state budget strategy 2021-2024 talks, as a result of which the government will also be able to make decisions involving the state budget audit. According to current plans, the state budget audit will become an annual part of the process of drawing up the state budget strategy, the ministry explained.

"The state budget audit is part of the state reform," Ministry of Finance spokesperson Ott Heinapuu told ERR on Monday. "The goal is an efficient state that offers services reasonably and directs attention and funds there where there is a shortage of them. With this restructuring, we want to achieve better results with the same funds, or the same results with fewer funds."

Develop, improve, make more efficient

At the same December cabinet meeting, the Ministry of Economic Affairs and Communications together with the Ministry of Finance were tasked with drawing up a plan by March for making the public sector's work more efficient with the help of e-state solutions together with proposals that would improve Estonia's budgetary position in the years to come.

The government also tasked the State Shared Service Centre (RTK) and the Ministry of Finance with drawing up improvement plans for the consolidation of state support in accordance with terms of reference and submitting proposals to the government regarding the consolidation of accounting services by this January, the consolidation of support implementation services by this May and the consolidation of document management and archival services by next March.

Two additional improvement plans should be completed by next spring with support from the Organisation for Economic Co-operation and Development (OECD) as well, one of which is to be used to improve the efficiency of investment management and the other to improve the efficiency of museum funding from the state budget.

For the first time, this year's state budget is fully activity-based, meaning it consists of sectoral programs in addition to the budget described in expenditures. The government will set performance targets for these programs, for the achieving of which state agencies will offer services at agreed-upon quality levels, volumes and prices.

"Every euro in the state budget is tied to a service, and every euro has a goal," Heinapuu explained. "As a result of the great deal of groundwork done during the drawing up of the activity-based budget, the government will have a better overview than before of the cost of services offered by the state. The groundwork done will also help us conduct the audit, and it will be easier for the government to make decisions based on data from an activity-based budget."


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Editor: Aili Vahtla

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