Rural Affairs Ministry withholds approval for food security bill
Estonia's food safety will depend on around a dozen major producers in the future. But the Ministry of Rural Affairs considers some obligations to be too much for companies and did not give the bill its blessing.
Sirje Potissepp, head of the Estonian Food Association, said on several occasions during the coronavirus crisis, when Estonia was short on masks, tests and vaccine doses, that major food producers should be treated as vital service providers. It seems the government has received the message, with new civilian crisis and national defense legislation offering the title to several major producers.
"The focus is on service providers that have the most profound effect on the functioning of the state and society;" said Galina Danilišina, adviser at the Government Office's security and national defense coordination bureau.
The framework for food security was developed with the Ministry of Rural Affairs and includes seven retail chains and eight food producers. The former were picked based on market share, the latter based on market share, turnover and the total number of producers in the field. It was agreed that Estonia still needs pasta, meat, milk and several other types of food even in the most serious crisis.
The dairy sector would be the responsibility of five firms: Väätsa Agro, Estonia OÜ, Valio Eesti, E-Piim and Nordic Milk. Bread would be the purview of Eesti Pagar, cereals that of Tartu Mill, while HKScan Estonia would be in charge of providing meat.
The status comes with a series of obligations. "They will need to ensure the continuance of vital services in every situation," Danilišina said.
Companies are disgruntled by the obligations side of the incoming legislation. "We had not counted on what the bill entails and could not have foreseen it in our worst nightmares," Sirje Potisepp said.
The Ministry of Rural Affairs will specify most requirements in separate regulations, while some rules that automatically apply to vital service providers are laid down in the so-called crisis law.
HKScan Estonia CEO Markus Kirsberg highlighted the cybersecurity requirement. The bill obligates vital service providers to be prepared to continue production even if Estonia loses all communications access to the rest of the world.
"A completely harebrained idea in this day and age," Kirsberg said. "The state should concentrate on making sure we have internet access and protecting those links instead of obligating companies to adopt outdated solutions," he added.
The Rural Affairs Ministry also finds that if the bill is passed in its current form, international groups that increasingly rely on cloud computing services would have to start erecting server parks next to their barns and production buildings. Alo Aasma, the ministry's deputy secretary general in charge of administration, admits that strict cybersecurity clauses are the reason the ministry refused to approve the bill.
"It would perhaps be much more sensible to require critical food producers to have satellite data links," Aasma said.
Galina Danilišina said it makes no difference to the Government Office how communications are handled as long as the service continues. She said that the phrasing of the bill will be adjusted should it prove necessary.
However, cybersecurity requirements aren't the only thing worrying producers. Markus Kirsberg said that companies are expected to continue production at 75 percent capacity inside 30 days of the start of a crisis.
"75 percent of what," Kirsberg asked. "Products suitable for human consumption or total turnover? Do we interpret it as production value, and should it include all products or those dubbed crisis goods?"
Kirsberg said the government and companies need to agree on specific products that should be manufactured in a crisis. "It may be sensible to produce baloney, while it remains questionable whether we should keep making chicken Kyiv."
But the questions do not end there. Should the company continue populating farms with chickens if it takes them 40 days to grow into broilers, or should it continue inseminating sows even though it will be a year before that will culminate in any meat products. Kirsberg said companies have no certainty or answers today.
Galina Danilišina said that more precise rules should be phrased in ministry regulations. Alo Aasma emphasized that the debate should not get stuck in the percentage. "Let us say the 75 percent marker needs to be seen as a general principle and treated with certain reservation."
Who will pick up the tab?
The sides believe that the specifics will be hashed out eventually. But the question of who will cover companies' expenses remains. The same question was asked by fuel retailers when obligated to install generators in gas stations and telecoms when they had to make sure cell towers could operate autonomously. Now, it is the turn of food producers.
"Ensuring food security is also the state's obligation. Unfortunately, that is not what the bill tells us. What we can see is additional obligations for companies," Potissepp said.
"Just as is the case for other vital service providers, [food] companies would cover the cost of risk analyses and plans, trainings, as well as expenses tied to service continuance," Galina Danilišina said. "It is a financial obligation for the company itself. Because any financial contribution from the government would immediately classify as state aid."
"What needs to be done to comply with state regulations should be a matter for the government, HKSCan CEO Markus Kirsberg said, adding that anything the business side of a company cannot use constitutes unnecessary expenses. "We are business enterprises after all," he said.
Sirje Potissepp said that while some support is available, it usually reaches smaller enterprises and not the large companies expected to ensure food security.
Neither Potissepp nor undersecretary Aasma could say how much of the responsibility should fall to the state and how much to companies.
"I can only say that the Rural Affairs Ministry is putting the finishing touches on a regulation that will direct €10 million toward food security. Major food industries will also share in that pot," Aasma remarked.
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Editor: Marcus Turovski