Both Saks and Sildam confirmed to AK that the conversation had taken place, on an informal basis at a social function.

During the course of the chat, which Saks said took place on June 9, Sildam, she said, had joined the dots between the promulgation of a package of legislation which had passed at the Riigikogu and required presidential assent – and the allocation of additional top-up funds to the presidential office, Saks went on.

In other words Saks implied a quid pro quo.

Saks told AK on Monday that: "I surely grasped that the president's office has financial concerns, while at the same time we needed to quickly put into effect a package of laws; the connection [between the two] arose on the basis of this conversation; that the work could be expedited."

Saks added that since the cat is out of the bag with the story, this meant that she was obliged to mention the conversation she had with Sildam on June 9.

For his part, Sildam confirmed that conversation had taken place, but that he was not using the promulgation of legislation as a bargaining chip.

Sildam told AK that: "Yes, indeed, I talked with Merike Saks, my good friend. I have not made any secret of it; everyone in the office who needs to know, knows about it. From my perspective it was just chatting, animated chatting on the sidelines of a reception."

Sildam said that the presidential office budget was a "hot topic" at that point in time, as was the internal political situation at the Riigikogu – where extensive filibustering had been used by the opposition parties.

"We certainly talked about the budget of the office of the president," he said. "But I can confirm that I have never asked for any deal or connected the budget of the office with the assent to legislation."

Saks told AK that she had not found the conversation to be jocular, and informed the Minister of Finance, Mart Võrklaev (Reform), of the fact and content of what was talked about.

"Had it just been a prank or a genuine joke, on my part, I wouldn't have informed the minister about this incident," Saks said.

Director of the Office of the President of the Republic of Estonia Peep Jahilo reiterated a statement which he had made earlier on Monday, to the effect that office which he heads up has never made the promulgation of legislation which has passed at the Riigikogu contingent on the president's office obtaining additional funding, over and above that set out in the state budget for this year.

A Postimees article which appeared on Friday first reported the allegation that the quid pro quo outlined above had been touted, without naming the source of this information or who proposed the deal.

All legislation requires presidential assent, in-line with the head of state's constitutional role.

The president's office has had to put on the backburner a planned official visit to Australia later this year, due to funding issues.

The situation is to be discussed by the Riigikogu's State Budget Control Select Committee, convened on an extraordinary basis – parliament is on its summer recess – on Tuesday.

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