SKAIS2 — used by the Social Insurance Board to process benefits, family allowances, pensions, and maintenance support — became notorious more than a decade ago for missed deadlines and ballooning costs. Ministers pointed fingers at each other, and millions of euros in state funds were wasted.

Now TEHIK is making a new attempt, launching a procurement to close SKAIS1 and migrate its services to SKAIS2 or other appropriate systems.

Juta Urbalu, SKAIS program manager at TEHIK, told ERR that SKAIS1 has reached the end of its technical life cycle and no longer meets modern requirements.

"It makes no sense to keep patching the system indefinitely. SKAIS1 and SKAIS2 currently run side by side, meaning the state must maintain two different technological environments, interfaces, and processes. That increases workload, costs, and technical risk," Urbalu said.

Epp Laanepõld, head of TEHIK's welfare domain, explained that SKAIS1 is an old system mainly used by officials, while SKAIS2 is newer and supports self‑service and many current e‑services.

She said further development will focus on self‑service, data exchange, and system flexibility. "So far, external development partners have played an important role, and we will need them for the long-term program as well. Existing contracts are ending, which is why we announced a new procurement," she added.

The new framework agreement will allow TEHIK to gradually develop and maintain social protection systems over the coming years and move from isolated solutions toward a more coherent and manageable ecosystem. "The maximum possible volume of the procurement is €28 million over five years. This is the upper limit of the framework, not an amount automatically spent," Laanepõld said.

SKAIS1 to be fully shut down in two years

Work will be ordered as needed through separate contracts. Larger developments over €600,000 will be competed again among framework partners.

The procurement is divided into five parts: benefits (the logic for calculating allowances and pensions), technical work for the new architecture, finance, user channels and general components, and a general section for ordering major developments through separate competitions.

According to Urbalu, SKAIS1 still contains about 15 services, each with a defined migration path. The largest and most complex is the old-age pension, with more than 320,000 recipients.

"Services will be moved out of SKAIS1 gradually, necessary data will be preserved, and the old system is planned to be fully shut down in 2028," Urbalu said.

She noted that SKAIS2's technical platform also needs updating. The system currently uses Oracle's database platform, but will gradually transition to open‑source PostgreSQL.

The goal is to reduce licensing costs and technological dependency, simplify system management, and create better conditions for future development and cloud adoption. The transition will be done module by module, not as one large change.

Financial accounting and service logic also need simplification. "Over the years, the system has accumulated many exceptions and complexities, leading to more manual work and making legal changes harder to implement. The goal is not to copy the old complexity into the new system. Before migration, service logic will be reviewed, simplified where possible, and more processes automated," Urbalu explained.

For users, the updates should mean more reliable and smoother service. Pensions and benefits must reach the correct bank account on time, and system updates should be as invisible as possible.

For Social Insurance Board employees, the changes mean fewer manual tasks and better oversight. For the state, it means a system that is easier to modify and develop in the future.

Clear responsibilities to prevent past failures

Given SKAIS2's troubled history, the question is how to avoid repeating past mistakes.

Urbalu said the biggest change is in management and responsibility. One problem in the earlier development was unclear roles and responsibilities — something the National Audit Office also highlighted.

"Now we have a clear model: the Ministry of Social Affairs is responsible for strategic direction, the Social Insurance Board for services and business needs, and TEHIK for the technical solution and development," Urbalu said.

The program manager has a mandate from all three parties, and each workstream has a named responsible person. Steering group decisions, deadlines, and responsibilities will be documented to prevent decisions from getting lost between organizations and to keep the program's direction stable over several years.

Another change: development did not start immediately. "First we mapped the existing system, the desired future solution, and the technical work needed to move from one to the other. This gives us a sequence — what prerequisites must be in place before migrating the next service," Urbalu said.

New development needs will be assessed based on whether they support program goals and fit the new architecture.

"The third change is the development approach. We are not building one big system that only becomes ready at the end. Services and technical components will be migrated step by step. Before moving on, we can check whether the new solution works and whether the plan needs adjustment," Urbalu explained.

All services continue to function

Budget management will also be phased. The €28 million is the maximum possible volume, not a fixed cost. "Work will be ordered based on specific needs and outcomes, and larger developments will be competed again. This allows us to manage scope, priorities, and costs throughout the program," she said.

Urbalu acknowledged that the work is large and time‑consuming. It is one of Estonia's critical payment systems, so the goal is not speed but control. "The most important measure is that services continue to function during the update and people receive their pensions and benefits on time," she said.

Funding for the updates is included in the state budget. According to Laanepõld, TEHIK highlighted the need to modernize the Social Insurance Board's systems during last year's budget planning, aiming to move them to a more modern technical foundation, improve resilience and reliability, and reduce manual work and the risk of errors.

"We received additional funding for the updates and have spent nearly a year preparing so that old services can be gradually moved to new solutions," Laanepõld said.

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