Kallas told Monday's "Aktuaalne kaamera" (AK) that she had asked the Center Party for more time to hold discussions. The Social Affairs Committee has already said it will start handing the bill, which is back by four out of five parties in the Riigikogu.

She said Center cannot say where the €300 million to fund the changes will come from.

AK asked Kallas if she thinks the issues will be resolved.

"This time, the solution was not sought within the coalition, but firstly from outside the coalition. That is why the situation is different. Even today, our request to show goodwill, to give us time for discussion, was not answered. So the situation is certainly complicated," the prime minister said.

Ratas, the Center party chairman, denied this and said Reform knew the party wanted to discuss this bill in advance.

AK asked him where the money will come from: "Like all other things in the budget of the Republic of Estonia, it will come from the taxpayers and it will be discussed in September."

He said Center wants to adopt the bill before Midsummer's Day. Kallas reiterated that this will only happen if the coalition collapses and reforms.

"If we look purely at the political reality, then the coalition agreement foresees that the Center Party and the Reform Party will vote together. If we look to find a consensus outside this coalition, then the political reality shows that this coalition no longer exists," Kallas said.

Both Kallas and Ratas have called the situation an "ultimatum".

Ratas told AK Center is not negotiating with other parties to form a new coalition.

Chairman of EKRE Martin Helme said Center has not discussed the issue with EKRE for months. He said the party would be ready to join a new coalition if Center made a proposal.

Background

The bill presented by the Center Party last Thursday (May 12) would boost the monthly child allowance benefit to €100 per child plus €700 a month for those raising three to six kids and €900 for people raising seven kids or more.

Andres Kalvik, a spokesman for the Center Party, said that the draft had been signed by members of all the other parties in the Riigikogu, except Reform.

Center Party whip Jaanus Karilaid said 54 signatures have been added to the bill out of 101, enough to pass the bill. The party wants the bill passed before Jaanipäev, Midsummer's Day, in June.

Reform Party whip Mart Võrklaev told ERR that Reform and Center agreed to discuss hiking family benefits in the 2023 state budget. He said entering the bill into proceedings is an uncoordinated step that will not have a positive effect on the health of the coalition.

Last month, Estonia's inflation was 19 percent, the highest in the Eurozone. Parties have been working to offset the rise in living and energy costs.

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