€117 million from supplementary budget to go on second pillar payments

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State budget law draft legislation. Source: Riigikogu kantselei

An important part of the supplementary budget formed due to the continuous coronavirus crisis is not related to the COVID-19 crisis, but to the pension reform, and this will cost €117 million from the government's reserve, daily newspaper Eesti Päevaleht (EPL) writes.

Even though the previous government canceled the state's contributions to the so-called second pillar of the national pension scheme, and these will be recovered on August 31, Jüri Ratas' (Center) government promised to compensate for this, though from 2023.

Current finance minister Keit-Pentus Rosimannus (Reform), however, says that a section in the law which accompanied the pension reform immediately instructs an individual withdrawing the money from the pillar to compensate for any missed payments.

"This derives from the law, and was written in on the budget line by the previous government, but there wasn't any money to cover it. Now, €117 million will go to the government's reserve, from the supplementary budget," Pentus-Rosimannus said.

The supplementary budget has been issued in response to the continued coroanvirus pandemic, similarly to last year's supplementary budget, issued in April 2020.

The Reform/Center coalition agreement contains a point on what the new coalition wanted to do in terms of pension payments recovery, i.e. to accomplish this earlier than September. Pentus-Rossimannus said that this would have meant increasing the deficit by another €77 million.

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Editor: Roberta Vaino

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