The Estonian government submitted its supplementary budget bill to the Riigikogu on Thursday. To mitigate the effects of the crisis, local governments will receive €30 million, with another €100 million earmarked for economic recovery.
"€30 million earmarked for local governments can, for example, compensate kindergarten fees," Minister of Public Administration Jaak Aab (Center) says. "It can also be used to cover other expenses, such as delivering food to elderly or buying personal protective equipment."
The Unemployment Insurance Fund labor market support measure and other Kredex measures have a positive fiscal impact on the budgets of local authorities. If a company can continue paying its workers, the local government will continue to receive income tax due to the measures.
In order to cope with a crisis situation, it is necessary to keep the economy running, including carrying on with planned investments. "Local authorities need not fear that the state will reduce their revenue base," Aab emphasized, adding: "I encourage the local authorities to go ahead with planned investments. Excess reductions will worsen the economic recession."
€70 million was earmarked for cities and parishes for additional investments, for example repairing, renovating and demolishing buildings, renewing street lightning, etc. €30 million will be used to upgrade roads.
Editor: Anders Nõmm