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Minister sees no conflict of interest in Nortal's personalized state involvement

Tiit Riisalo.
Tiit Riisalo. Source: Priit Mürk/ERR

Minister of Economic Affairs and Information Technology Tiit Riisalo (Eesti 200) said that both Nortal and the company Cybernetica are contributing to the creation of Estonia's personalized state concept. The minister does not see a potential conflict of interest in the contribution of Nortal, which is led by Priit Alamäe, a founding member of Eesti 200.

On Monday, at an event held by the Ministry of Economic Affairs and Communications to introduce the vision of a personalized state, a representative from Nortal, Andres Raieste, who is also a member of the Eesti 200 party, spoke. Nortal's CEO is Priit Alamäe, who has been one of the authors of the personalized state idea and is also one of the founders of the Eesti 200 party. ERR asked Minister Riisalo about Nortal's role in developing the personalized state.

"In this specific matter, as well as in the broader context of Estonia's technology development, we have always worked together with the private sector. This has been one of our strengths since the late 1990s when we started building a digital state. And of course, we maintain this tradition. And the same principle was applied to the creation of this document (the white paper on the personalized state – ed.). There's no point in concocting it out of thin air in the ministry's offices, and if we have practitioners, then we should primarily consult with them," Riisalo commented to ERR.

"When we talk about cooperation with the private sector, it's gratifying to note that over the years, Estonia has developed very strong professional organizations. The Estonian Association of Information Technology and Telecommunications is one of the strongest among them. There's the personalized state, but also other developments that we discuss. For example, a white paper on e-identity is in the works. We are in the final stages of an AI data economy book. Naturally, we discuss these documents with them and the companies with the relevant expertise contribute. And there's no denying that Nortal is one of Estonia's leading digital economy companies. And of course, in projects related to building personalized states, they have extensive international experience, and we are very grateful that these people found the time and opportunity to contribute to this work, which has also seen contributions from other companies, a whole host of government agencies, and naturally the IT houses within the Estonian state system. This document is a kind of collective creation, so to say, open source for public use," Riisalo explained.

"It's no secret that Nortal is very competent, as are AS Cybernetica and many others who contributed," he added.

How did Nortal contribute to the personalized state?

ERR asked for specifics on how Nortal contributed to the personalized state program.

"In this case, it was based on both the vision of Eesti 200 and the minister. We formulated a mission statement and went from there. Then, in the Ministry of Economic Affairs and Communications people stepped forward as project leaders and began to progressively involve competent authorities and competent private entrepreneurs, and that's how it came about," Riisalo explained.

Asked whether there could be a conflict of interest in Nortal's contribution, Riisalo denied any such risk.

"I absolutely do not see any conflict of interest here. If we're talking about people contributing their knowledge in their free time. There are also other entrepreneurs in Eesti 200. They work in various companies. Inevitably, some of them also have dealings with the state. I personally do not see any problem here," Riisalo said.

"I understand what you're referring to. I find this context negative and unfair. One aspect is that there is no one specific company involved in all these projects. Perhaps sometimes they are, if there's some very specific know-how needed. When we talk about e-identity and cryptomathematics and we want the Estonian system to be future-proof, then we don't have many choices – we go and talk to Cybernetica, because they have the know-how. It's another matter that when the Estonian state starts ordering such a solution, of course, it will be done through public procurements. And as far as I understand, the procurement system in Estonia works very well and is transparent," Riisalo stated.

Riisalo mentioned that if any member of the Association of Information Technology and Telecommunication were to see that a competitive advantage was being created for one company or another, they would signal this.

"We have other companies in the same sector that operate internationally. But many of them are not as large and, consequently, have less time to contribute. If there's any suspicion, which I think is completely inappropriate, that this somehow creates financial advantages for someone, then the project is led by the Estonian Information System Authority (RIA). They are the ones who actually implement this, carry out the developments, and announce procurements as necessary. The larger ones are open across Europe. In my opinion, we cannot talk about giving anyone a competitive advantage here," he added.

The personalized state was one of Eesti 200's election promises, which also made it into the coalition agreement. Implementing the personalized state would require €200 million, which, according to the party, the government could borrow.

The personalized or personal state concept aims to render an individual or company's communication with public institutions more personal, streamlined and convenient by offering people and companies public services based on their individual needs and the data they have shared with the government.

Riisalo: The concept of a personalized state needs more explaining for some

The idea was briefly discussed in the government coalition last week during the state budget strategy discussion. Coalition partners have so far been cautious about the personalized state initiative. According to Erkki Keldo, the leader of the Reform Party's parliamentary group, the idea is still raw, and he wants to see a more detailed plan. Eesti 200's other coalition partner, the Social Democratic Party (SDE), is also skeptical. The party leader, Lauri Läänemets, said that Estonia first needs to invest in education, healthcare and energy, and only then could additional investments in IT systems be considered.

Tiit Riisalo acknowledged that more explanatory work needs to be done within the government coalition. "This is a very big part of the work; explanatory efforts need to be made. There are people who understand quite easily the perspective this actually opens up for us, while others need more clarification," Riisalo said.

The IT minister mentioned that on January 30, Eesti 200 introduced its initial views to coalition partners. "For us, this was actually somewhat the beginning of the state budget strategy negotiation process. And I think this is very good because, as you may recall, last year this was done with tremendous haste, within a few days, when it wasn't possible to calmly calculate, discuss and weigh things. Now we have half a year for this, and we've put forward the first vision, but a thought-out vision, on how we build this and what could be the cost," Riisalo stated.

He mentioned that by summer, Eesti 200 will come with very thought-out and calculated plans that explain why the personalized state is necessary, what benefits it brings in different areas, and what justifies the potential investment.

ERR also asked Nortal CEO Priit Alamäe, about Nortal's role in developing the personalized state and whether he sees a potential conflict of interest in Nortal's participation.

​Priit Alamäe's comment

"Äripäev published on December 7, 2015, an essay by Nortal's CEO and a member of the then Pro Patria and Res Publica Union (IRL), Priit Alamäe, titled 'Personalized State – Let's Make It Faster,' which was also declared the winner of Äripäev's essay contest in March of the following year. I was then, and remain now, convinced that Estonia's digital reputation is of stellar value for both our economy and foreign policy, and it must be preserved and developed.

Since Estonia was ahead of the rest of the world in its digital development at that time, we were able to speak confidently about things the rest of the world could not even dare to dream of. In the last decade, the rest of the world has started to catch up with us in their digital development, and those same ideas that were published in December 2015 have now, in various forms, made it into the megatrends promoted by the OECD and, for example, Gartner (Post-Digital Government, Human-Centered Design, Insight-Driven Decisions).

We work on e-governance projects worldwide and have always tried to spread global best practices in Estonia because we must always learn from the best. Today, although Estonia is a clear leader in the world, we too have enough areas from which to learn. I am sincerely pleased and proud that some of the ideas I proposed in 2015 have made it into the white paper published by the Ministry of Economic Affairs and Communications (MKM), to the compilation of which, in addition to MKM's experts, contributions have been made by the Estonian Information System Authority, the Center of Registers and Information Systems, the Estonian Rescue Board, the Social Insurance Board, the Health Board, the University of Tartu, AS Cybernetica, AS Nortal, the Estonian Association of Information Technology and Telecommunications, the Ministry of Finance, the Ministry of Social Affairs, the Ministry of Defense, the Ministry of the Interior, the Ministry of Rural Affairs, the Ministry of Foreign Affairs, the Ministry of the Environment, the Ministry of Justice, and the Association of Estonian Cities and Municipalities.

Founder of Nortal Priit Alamäe. Source: Priit Mürk

This is a very ambitious and broad-based initiative, which can only be welcomed. Estonia has a unique opportunity and capability in the world today, based on our existing technological and legislative infrastructure, to take the next step in digital development and secure our position as a global digital leader for the next decade. And this is in addition to the value that good services and efficient state governance provide to Estonia as a place to live and do business.

I also watched the presentation online yesterday, and it was mentioned that this white paper is now open source and everyone is invited to contribute their ideas and constructive criticism to create versions 2.0, 3.0, and hopefully 10.0, and to implement the good ideas contained therein.

Last year, the e-Estonia Showroom had 6,000 visitors coming to familiarize themselves with our digital society, and I believe that the vision outlined in this white paper largely answers the question "why should international delegations come to Estonia in 10 years?"

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Editor: Aleksander Krjukov, Marcus Turovski

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