Läänemets: SDE will be balancing element in planned government

Lauri Läänemets (SDE) speaking at Wednesday's coalition talks press conference. March 15, 2023.
Lauri Läänemets (SDE) speaking at Wednesday's coalition talks press conference. March 15, 2023. Source: Priit Mürk/ERR

The Social Democratic Party (SDE) will be a balancing element to the planned government coalition's two more right-wing parties, SDE chair Lauri Läänemets said in an appearance on ETV's "Esimene stuudio" Thursday night.

Läänemets acknowledged that, mathematically speaking, Reform and Eesti 200 combined have the requisite 51 seats for a majority in the Riigikogu, but that would also mean that every MP would always have to be present for votes.

"In reality, they, combined, don't have [the necessary number of seats]; they need a third party," he continued. "I think they both understand that the government needs a left-wing party that would balance them out and that would say, 'Stop! There are people in Estonia that need attention' and that there is significant regional inequality in Estonia."

The party chair spoke on Thursday's program about various topics currently being negotiated at ongoing coalition talks between Reform, Eesti 200 and the SDE, but according to him, they can't yet speak of concrete agreements.

He acknowledged that the new government likely won't manage to create a fairer tax system, but the Social Democrats' goal is to help people out of wage poverty.

"The Social Democrats' proposal to increase the minimum wage — that I believe we'll be discussing thoroughly," he continued. "And one way or another, whether through this promise or some other opportunity, we'll find a way to reduce wage poverty."

According to Läänemets, there has been a consensus at coalition talks on increasing teachers' wages, but everything will depend on the state's financial situation.

"What I can say is that the desire was there at the [negotiation] table, and if we're able to reach an agreement financially — and I believe we'll then have to reach an agreement on growing the revenue side — then it can be done," he explained. "Yes, what we discussed, at least, won't be possible next year, but it will in the coming years."

The SDE leader doesn't believe that tuition will be introduced for higher education. He added that the three negotiating parties are fundamentally in agreement on increasing study grants as well, but this will likewise depend on available money.

"The expenses side at the table is pretty big; the key lies in how we'll handle the revenue side," he underscored.

Local governments need chance to introduce taxes

According to Läänemets, there has essentially been a consensus at coalition talks that local governments need to be granted the right to impose their own taxes.

"For example, a lot of tourists visit the island of Vormsi," he explained. "They generate a great deal of waste, and every tourist could easily be asked [to pay] €0.50 or €1, and then the tourist will have also paid for the management of their own waste. Or a tourist tax in an area where tourists do bring in money, but might disturb people's peace somewhat as well. Allowing local governments to impose some sort of taxes like these is quite normal."

He believes tourist taxes would benefit tourism companies as well.

The Social Democrats would abolish the nationwide and tax exemption for land on which someone's home is located and hand over the right to implement that exemption to local governments, allowing each one to do so according to their means.

"Estonia's most expensive- and wealthiest area, Tallinn's Old Town, is currently tax exempt as well," he pointed out. "That isn't normal logic — that the wealthier you are, the less you pay."

The SDE chair believes the planned coalition government may keep small schools in the country's rural areas open as well.

"I think small schools remaining open throughout Estonia will happen," he said. "That is important. Local governments currently considering closing down six-class schools — I'd say wait. The state won't let life outside of major cities completely die out."

He would also give local governments the right to impose a congestion tax as well, to encourage people to use public transport in cities more. He did add, however, that he doesn't consider such a tax reasonable in more rural areas, which currently lack decent public transport.

Two major changes in Ida-Viru County

The planned coalition wants to appoint a special representative to Ida-Viru County that would help implement the transition to Estonian-language education as well as the use of funding from the EU's Just Transition Fund (JTF).

"The idea isn't that we're going to send a representative there to solve problems," Läänemets explained. "The idea is that two very big changes concern ida-Viru County. One is the transition to Estonian-language education — which is essentially Tallinn and Ida-Viru County. That involves a great deal of emotions, a lot of complex issues, fears. The other is the just transition as it applies to oil shale and the Green Deal. We want it to go quickly, better and in such a way that the government is with these people more, so that people would understand what the government is doing and the government would increasingly take these people's wishes into consideration."

He noted that only a very small portion of JTF money has been spent to date. "There are some pretty big challenges in terms of how to use it," Läänemets said. "We have to make every effort to ensure that the money that's meant for Ida-Viru County actually makes it there."

Potential sixty-seat majority

Last Tuesday, March 7, the 2023 Riigikogu-election winning Reform Party decided at a party board meeting to invite Eesti 200 and the Social Democratic Party to initiate coalition talks, Prime Minister and Reform chair Kaja Kallas announced at a press conference that day.

Both parties accepted the invitation, and talks began at Stenbock House the next day.

Reform won 37 seats in the 101-seat Riigikogu in the elections to conclude March 5. Together with Eesti 200's 14 and the SDE's 9 seats, the anticipated coalition would command a 60-seat majority in Estonia's unicameral parliament.


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Editor: Aili Vahtla

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