Isamaa chair: State budget lacks clear goal
Isamaa chair Helir-Valdor Seeder criticized the state budget for the coming year Thursday, presented by the government this week, saying that it has no clear purpose.
Appearing on ETV news show "Aktuaalne kaamera" (AK), Seeder said that Prime Minister Kaja Kallas (Reform) had presented small victories in the Riigikogu on Thursday, but did not mention what the budget does not contain.
"If such an overall assessment is given to the budget, it is one without a clear goal, one which shows that the coalition parties have very differing views. One party talks about putting public finances in order, cuts and state reform, the other one is talking about raising subsidies, salaries, pensions and everything else," the opposition politician said.
Reform has been in office with Center since January, and the 2022 state budget is that alignment's first.
Seeder said that he is not satisfied, for example, that there is no solution in the budget for the rapid rise in electricity prices, although proposals have been made by both experts and opposition politicians.
Minister of Public Administration of the Center Party, Jaak Aab (Center), responded to Seeder's criticism of measures to increase electricity prices. He cited the abolition of excise duty increases in the spring of next year as one such measure. "We annulled the increase in excise duty this year and the increase in the coming years is flat as well and will cost the state purse €265 million."
In addition, Aab spoke about the use of low-grade wood to burn in Narva power plants. "It will definitely lower the price pressure on electricity," he noted.
Aab said that it is also planned to find a way to compensate for the increase in the price of electricity for the poor.
"Urmas Reinsalu said that we pay the renewable energy fee. It cannot be done, there are certain conditions for using CO2 money. However, it is possible to compensate for low-income families. And that was one proposal, but it was left unsolved, but we are hoping to solve it during the Riigikogu's procedure. So that more CO2 funds come from the quota trade, and it is possible to make such a compensation mechanism to provide additional support to low-income families with many children," Aab said.
Seeder is also dissatisfied with the budget deficit, which he says is too large. "Revenues are €13.13 billion and expenditures are €13.64 billion, just as if there is a deficit of €500 million. No. There are €716 million of investments to be added. In fact, the deficit is €1.2 billion," he said. He added that it would not be reasonable to cut the budget at this time either.
Aab said that not everything can be done and that balance needs to be found somewhere. "One of the things that goes through the opposition - I also heard Martin Helme's comments - is exactly that the deficit should be reduced faster, but on the other hand, these and these costs should be done. Not everything is possible, it's not such an easy task. Somewhere in the middle, this balance must be found and it is in this budget. It is our proposal and the Riigikogu can decide whether this balance is suitable," he said.
On Thursday, the government published the main indicators of the 2022 state budget.
The timing of the budget changes
Helir-Valdor Seeder noted in the broadcast that the core of the budgeting problem is that the government and politicians do not have time to deal with the budget, based on the summer economic forecast, which will be announced around September 10.
"The budget must be submitted to the Riigikogu by October 1. This means that officials have a total of three weeks to make political decisions in real time and formulate and discuss them. This is a completely abnormal budgeting process," he said.
Aab said that the government wants to change that. "Together with the budget, we have introduced an amendment to the budget law. We have also contributed to the technical side, our agencies have become more capable. We propose to prepare both the state budget strategy and the budget as one process in the autumn. I hope that next year we can delve deeper and more substantively," the minister said.
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Editor: Roberta Vaino