On Monday, the Riigikogu's State Budget Control Select Committee met to address an ambiguous message communicated to Minister of Finance Mart Võrklaev (Reform) by Internal Adviser to President Alar Karis, Toomas Sildam. At the meeting, Võrklaev said that as a result of the message, morally he is not in a position to grant additional funding for the president's office this year.
On June 14, Võrklaev informed the president's office that it would not be receiving any additional top-up funding from the government's reserves this year. Prior to this, Sildam had held talks with Võrklaev and General Secretary of the Ministry of Finance, Merike Saks, and the president's office had submitted an informal request for additional funding.
According to Võrklaev, Sildam's appeals presented him, Merike Saks and head of the prime minister's office Gerrit Mäesalu, with a moral dilemma. As minister of finance, approving the request for funds under such circumstances would, in Võrklaev's view have meant he was making a quid pro quo deal, as that was how he understood the message conveyed in his conversation with Sildam.
"When I received a call from the General Secretary of the Ministry of Finance, confirming that these things were also linked in her conversation with Sildam, the only thing to do was to send a letter to the president's office saying that we would not [make a deal to] resolve this funding [issue]," said Võrklaev.
According to Võrklaev, this also means the decision has been made to allocate no additional funds to the president for representation expenses in 2023.
"I have the impression that these things (the proclamation of the law and the allocation of extra money to the president's office - ed.) have been linked, and so I consider it right and proper not to have allocated the money. The minister of finance was put in a situation, where it is not possible to grant these additional requests," said Võrklaev.
What will happen to the budget for the president's office's next year will become clear once the state budget has been drawn up.
Võrklaev added, that conversations he has had with Sildam gave him the impression that he was not morally in a position to make a positive decision regarding the extra money.
At the same time however, Võrklaev did not describe Sildam's appeal as blackmail, with the minister adding that it was not clear to him whether Sildam had taken the initiative himself or had been asked to deal with the matter by the president's office. This is why he turned to the president's office rather than to law enforcement for clarification.
"And they (the president's office - ed.) would then decide what to do with that information. If we had made a statement (to law enforcement agencies), there would have been headlines stating that the government is forcing the president to make decisions by going through law enforcement agencies. In my view, I made the morally correct decision," said Võrklaev.
Saks, who also attended Monday's select committee meeting, previously told ERR that she did not turn to the Internal Security Service (ISS or KAPO) after her conversation with Sildam because she had not believed the conversation to have involved anything criminal, it had simply been awkward.
As for the conversation with Saks, on Monday Sildam admitted that he had probably gone too far with acerbic and dark humor during the conversation as a result of his frustration. However, he categorically denied offering any form of deal.
"The situation (having to ask for extra funds for the president's office) seemed humiliating. I certainly didn't offer any deal - could there have been a misunderstanding? Possibly," said Sildam.
Conversation also took place with head of the prime minister's office.
According to Sildam, he had conversations with several people about the president's office's need for additional funds. However, at no time did he suggest a link between the proclamation of the law and the extra funding, nor did he offer any kind of deal.
Urmas Reinsalu (Isamaa), who chairs the Riigikogu committee investigating the issue, said they had information that Sildam had also spoken to the head of the prime minister's office, Gerrit Mäesalu, regarding the same subject.
Sildam admitted that Mäesalu had indeed been contacted. "I think I said that we had a concern and then we talked about it. But there was no deal [made]. We understand that it is not within the competence of the presidential adviser to decide on the speed at which laws are promulgated," he said.
According to Mart Võrklaev, there are other people he knows of with whom Sildam spoke on the same subject. However, the finance minister repeatedly refused to name them during the meeting, saying it should be Sildam himself who does so.
According to Sildam, he was unable to remember who all the people he had spoken to about the matter were.
Võrklaev: The way things are done has changed
Sildam went on to say, that given the situation in which it was known that the president's office needed extra money, his behavior was natural.
"If it is known that there is a problem, then when I meet the Ministry of Finance, I ask [about it]- it's completely natural. When I talk to Mäesalu, I say, listen, we also have a concern. It's a somehow human form of communication," Sildam said
According to Võrklaev however, Sildam's conversations had the opposite effect and left him feeling it was not morally right for him, as finance minister, to make a positive decision regarding the funding. "Because my feeling was that these things are related and I don't think that's right," he said.
Võrklaev then commented on Prime Minister Kaja Kallas' (Reform) assertion last week that, while in the past it may have been normal to bargain money over the promulgation of laws, such practices are not acceptable today. The finance minister said, while Sildam's behavior may have been the norm 10 to 15 years ago, it is now no longer the case.
"Proper communication is required now even more so than in the past," said Võrklaev.
All parties involved confirmed that there has been no disagreement between the government and the president's office.
While two weeks ago, when the scandal first came to light, the media appeared to suggest the government and the president's office were at loggerheads over funding, both Sildam and Võrklaev confirmed that this is not the case.
"I would like to confirm that the institutions are not at odds. People have their differences and they will be ironed out," Sildam said.
According to Võrklaev, no disagreement has taken place either, and the fact that the funding scandal came to the public's attention the day after President Alar Karis criticized plans for the long-awaited car tax was simply a coincidence.
On Monday, the Riigikogu's State Budget Control Select Committee met to hear the parties involved in the dispute over funding for the president's office. The committee was addressed by Toomas Sildam, Merike Saks, and Mart Võrklaev, who represented Prime Minister Kaja Kallas.
The committee discussed the allegations that, in a conversation with Võrklaev and Saks, Sildam had connected the presidents' office's request for additional funding to the announcement of the laws last Tuesday. Head of the president's office Peep Jahilo, and Mart Võrklaev both attended the hearing.
Saks has previously said, that in a conversation in early June, Sildam had linked the announcement of the legislative package related to the car tax and the allocation of funding for the president's office.
Sildam called the incident a misunderstanding.
Võrklaev, who claims he had a similar conversation with Sildam at around the same time, only made the details public in early August.
Editor: Michael Cole