Last year, the Social Insurance Board paid a total of €840 million in state family benefits. Of this, €490 million, or 58%, was allocated to various family support measures – childbirth, child and family allowances. Parental benefits, often referred to as "maternal salary," accounted for €349 million, or 42%. In comparison, pensions amounted to €2.644 billion.

The coalition's austerity plan includes cost-saving measures involving child benefits, with a consensus to primarily reduce support for wealthier families.

"We need to move towards needs-based support, meaning that from a certain income level, these benefits are reduced because the need for them is significantly lower. Providing uniform support to everyone is simply beyond the state's and taxpayers' means, and it is not necessary," explained Minister of Education Kristina Kallas (Eesti 200).

The threshold defining wealthier and poorer families is expected to be determined by an analysis to be completed by the end of the summer. According to coalition partners, the most reasonable way to save on child benefits is to lower the ceiling for parental benefits.

"Everyone will still receive parental benefits, but the highest amount will no longer be as large. Currently, it is three times the Estonian average salary, which exceeds €4,700. This could be one area for discussion to help the government form a unified position," stated Minister of Social Protection Signe Riisalo (Reform).

Changes are also likely for the support provided from the third child onwards. The government is currently considering whether to eliminate this support for wealthier parents, regardless of the number of children. The Social Democrats are hesitant about this approach.

"I feel that this would have been done a long time ago if it were simple because the other side of needs-based support means that the state needs much more real-time information. Frequently updated information about what types of families children live in and their situations is not available," said Minister of Health Riina Sikkut (Social Democratic Party).

Praxis labor and social life analyst Katre Pall also points out that moving to a needs-based system would create a complex structure and increase bureaucracy, for which the state may not be prepared.

"Children may move between households, living in one and then another. This raises technical questions, such as whether only the biological parents' income is considered and which dependents are included. We have these blended families, and it's difficult to compile a complete picture of family composition, as there is a lack of good baseline data," commented Pall.

Final decisions regarding child benefits will be made during the government's autumn budget discussions.

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