Finance minister: State budget likely a tightening, not buckling of belts

Finance minister Martin Helme (EKRE) speaking on Thursday evening.
Finance minister Martin Helme (EKRE) speaking on Thursday evening. Source: ERR

The state budget is not likely to see any major changes, despite a need for the tightening of belts, finance minister Martin Helme (EKRE) said Thursday evening.

The coalition government cabinet met Thursday evening to discuss the budget for 2020, which it aims to put to a Riigikogu vote on Sept. 25. After the meeting, which lasted several hours, Helme noted that the run-in to the budget had started, but concrete numbers could not be revealed just yet.

The ministers present had got an overview of the state of Estonia's economy, but the economic forecast which will provide the main basis for drafting the budget is to be presented by the finance ministry Monday.

The state budget is drawn up every autumn for the forthcoming year, with an overall strategy for several years ahead, and governmental economic forecasts, appearing ahead of that. A significant proportion of the budget overview involves apportioning monies to each of the 11 ministries.

"When we drew up the state budget strategy in spring, it was clear that we needed to find savings within the next budget," Helme said after the meeting as reported on ETV current affairs show Aktuaalne kaamera.

"This requirement has not disappeared. The budget remains tight, but there is no catastrophe to speak of," Helme continued.

"The picture is, of course, changed by the fact that GDP figures have been revised to a large extent. But this will not directly bring about a huge change in the budget," he continued.

In fact, cuts that are needed are smaller than those forecast in spring, Helme said.

With regards to requests for additional funds put in by individual ministries, these are reviewed and prioritized in the course of budget discussions, Helme said.

"The take-home from today is that instead of asking for more, let's see how well we can manage within the limits of our existing resources. Perhaps we won't see any budget increases," he continued.

"We are certainly moving towards budgetary balance, but as a result of the GDP revaluation, it was concluded retrospectively that 2018 actually gave a larger deficit than thought, and in this sense the budget balance shifted over time, though it may not change much in terms of numbers.

Since the coalition wants the budget approved by the end of September, a vote a week ahead of that is needed, as there is a week-long recess at the Riigikogu at the end of the month. All five parliamentary parties, the three coalition parties which have a majority of 56 seats, and the opposition, which has 45 seats at the 101-seat Riigikogu, vote on whether to pass the budget.

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Editor: Andrew Whyte

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