The panel noted that there was no certainty that the government was making a sufficient effort in reforming the state and gave the government a score of three out of five in April.

Praxis management board chairman Tarmo Jüristo said that the report highlighted important shortcomings both in the implementation of the administrative reform as well as in finding answers to the question of what kind of state Estonia can and wants to support.

"Looking toward the future, the key question is how to achieve a balance in the income and expenses in the state budget and how the government will help to achieve that," Jüristo said. "In addition to renewal, there is also a need for a vision for the state reform — big changes require a view which spans further than one government cycle."

He said that life would not come to an end after local elections and the Estonian EU presidency and that preparations for new challenges should already be made.

"The proportion of EU support in the state budget will decrease notably in the future," Jüristo warned. "What will it mean from the viewpoint of state reforms? These questions lack a clear answer and there is no certainty that the government is making a sufficient effort toward developing the state's future strategy."

Although in the first quarter of the year the State Reform Radar had emphasized the need to more resolutely move forward with the administrative reform, the progress made in the second quarter with regard to merging together local governments has been contradictory.

Toomas Tamsar, head of the Estonian Employers' Confederation, said that despite the fact that the Riigikogu terminated the activity of county governments and approved a long-awaited regulation on establishing joint agencies for local government authorities, which will aid cooperation between local governments, there were still many uncertainties regarding the distribution of public functions and funding.

Aivo Adamson, member of the State Reform Radar panel, said that the primary factor behind the "not satisfactory" verdict was a delay in important decisions, a lack of ambitious vision and poor quality in mangement.

"A standstill in governance, tax policy and social welfare cannot be broken if policies are still drawn up in a closed manner," said Adamson. "A great danger lies in path dependency — there have been instances recently in which the new ruling coalition steps on the same rake as previous governments, sometimes violating the principles of good governance."

The State Reform Radar publishes quarterly evaluations of the progress being made on Estonia's ongoing state reform. The grade is determined by a 13-member panel including Aivo Adamson, David Vseviov, Heldur Meerits, Jaak Aaviksoo, Külli Sarapuu, Küllo Taro, Maarjo Mandmaa, Olari Taal, Taavi Veskimägi, Tarmo Jüristo, Tiina Randma-Liiv and Toomas Tamsar.