Michal is set to return as head of government, over 12 ministers – two fewer than in the last, Reform-Eesti 200-SDE administration – and split equally between the two parties.

He said: "This government is probably as different from the previous one as night and day. We actually haven't had a right-wing government in Estonia for a long time."
"From now, it will be friendly to enterprising and freedom-loving people. Regulations will be simplified, corporate income tax will disappear along with the departure of the Social Democrats, and the obligation to pay income tax from the first euro earned will be eliminated," he continued.

This was also the result of dialogue with business, he added.

"Estonia's top businesspeople came to the prime minister to help with this. And this work will be quite concrete — it won't be a lengthy report, but specific proposals for the economic cabinet, which we will start implementing," Michal continued.

"I think this government composition will definitely bring a new perspective and freshness. When I look at it as a whole, Karmen Joller is to take over the twin responsibilities merged under the Ministry of Social Affairs. With her prior medical experience, she will bring a new perspective to healthcare, while Signe [Riisalo] will continue her good work," the prime minister went on.

Riisalo (Reform) had been social security minister in the last administration, but her position was one of two which have been axed.

The other, climate minister, is a position Michal himself had held 2023-2024 X.
While Yoko Alender, who held the post most recently, has stepped down and Andres Sutt has been appointed new energy and environment minister, the climate ministry itself will continue to function in its current format, Michal added.
"The Climate Ministry, as such, will remain a ministry," he said.

"We are not spending time on relocating ministries. Andres Sutt's stance and preference is that his job description should also be better reflected in the title — this means standing for energy and the environment, in addition to all other related fields," Michal added.

This was also a case of clarifying things for the public, Michal said.

"Since there is another minister, the infrastructure minister, this might give the public a clearer picture of how these tasks are divided. And the ministry itself carries out the tasks assigned by ministers and the government agreement, so we are not wasting time on ministry relocations," he continued.

As to whether this would spell a change in Estonia continuing to fulfill its climate commitments to the EU, the prime minister said: "In all these major arenas — environment, energy, industry — that are even remotely related to climate policy, including housing and transport, now will come the second phase of negotiations."

"This was not detailed in the initial agreement," he added.

The government's recommendation is to postpone the sustainability report and later make it voluntary, he continued, drawing on the experience of Paavo Nõgene, Tallink CEO.

"Paavo Nõgene has vividly described how this consumes time. But if an entrepreneur feels that it benefits them or is necessary for their business, then they may carry it out. I have already made this proposal at the European Council," he said.

The incoming government also supports the recently announced LINK postponement and cancellation of the ETS2 system.

"We are likely moving toward reducing certain reports and regulatory norms with this government. But every step in its own time. We will precisely formulate these policies, choices, and specific actions, and then we will be able to describe them," Michal said.

A strong defense and foreign policy can also be expected from the new government, the head of government said.

Michal stressed the experience Sutt, a former government minister who has previous experience at Eesti Energia and the Bank of Estonia, and infrastructure minister candidate Kuldar Leis, who is an entrepreneur who most recently led the Tartu2024 culture capital program, would bring.

As for the latter, Michal said he "has long defended the Reform Party's colors and has also served on various councils during elections. Everyone who has interacted with him before – including myself, in the context of Tartu's cultural capital project and elsewhere – knows how lively and optimistic he is. I think this is needed in the government."

He also noted the experience the two new Eesti 200 ministers had – Taro with his experience in heading committees and day-to-day experience on the ground, and Terras, who will face major reforms including in public transport and the privatization of postal service Omniva.

The new ministers must be voted on at the Riigikogu before taking the oath of office.

A new government agreement was necessitated following the ejection from office of the Social Democrats nearly two weeks ago, leaving Reform and Eesti 200 to govern as a bipartite coalition.

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