Läänemets: Having an agreement in place by Wednesday depends on Reform

Lauri Läänemets.
Lauri Läänemets. Source: Priit Mürk/ERR

Chairman of the Social Democratic Party (SDE) Lauri Läänemets told ERR that the sides will move on to the financial side of the potential coalition agreement this week, adding that having a broad outline before Midsummer Day depends on the Reform Party.

Läänemets said that SDE, Isamaa and Reform mapped out the sides' interests, major differences and topics in need of further debate during talks last week.

"In the field of energy, the Social Democrats had a lot of renewables proposals, while the working group also discussed Isamaa's electricity market reform plan. We had a separate working group for education topics," he said.

"We will start next week (Monday – ed.) by listening to the latter's proposals or results, after which, I believe, we will move on to the financial side of decisions. We will hopefully have the finance ministry's forecasts for what our tax change proposals and price of electricity compensation measures would cost by then."

Läänemets said that SDE believes hiking the basic exemption to €800 a month is the most effective way to fight inflation.

"Keeping in mind that lowering the excise duty on fuel might not work because it would still be expensive, whereas recent experience from Germany suggests the difference might disappear somewhere, as well as other relevant factors, I feel that the sides should come together in realizing that exempting €800 from income tax, to leave people with an extra €700 a year after taxes, is the most effective measure on the table today. It will also help entrepreneurs in alleviating pressure on hiking salaries. It has plenty going for it," Läänemets explained.

He said that the negotiators will try to have the agreement in place by the end of the three-week workweek leading up to the Midsummer holiday.

"[Whether this can be done] depends mostly on how much spending the Reform Party will agree to. Their position has been relatively conservative until now, while we have not gone into fiscal detail so far. /…/ The Social Democrats would like to support low and middle-income people. But the financial side of things will depend on what can be agreed," Läänemets offered.

He added that while he is convinced there will be a coalition agreement, the question is when.

"Ideally, we could have a conceptual outline by Wednesday, followed by all the necessary procedures after Midsummer Day. Unfortunately, whether that will happen depends on the Reform Party rather than SDE," he said.


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Editor: Marcus Turovski

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