First Reading of the Draft Act on the 2024 Supplementary Budget (456 SE)
Session: 15th Riigikogu, 3rd sitting, plenary session
Date: 2024-06-10 18:07
Total Speeches: 55
Membership: 15
Agenda Duration: 1h 14m
AI Summaries: 55/55 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
First reading: Regarding Bill 456 of the 2024 Supplementary Budget Act, initiated by the Government of the Republic. The presentation was delivered by Finance Minister Mart Võrklaev. To reduce the budget deficit, a negative supplementary budget was prepared, incorporating 183 million euros in revenue and expenditure balancing measures. The objective is to maintain state finances at a sustainable level and ensure the minimum deficit level of 3% of GDP, with national defense and related sub-areas being prioritized. The need to refine and coordinate the budget stems from the pessimistic assessment provided by the spring economic forecast and the weakening of tax revenue collection. A specific characteristic of the supplementary budget is the agreement on 115 million euros in savings measures and 68 million euros in revenue measures, alongside the acceleration of investment implementation, aiming for 70% of investments and investment grants to be covered by commitments by the end of August. Opinions were divided during the debate, but the final decision was to conclude the first reading. Proposals with specific deadlines will be discussed on June 12 at 4:00 PM, and the Center Party’s motion to reject the first reading failed. The general direction involves a collective effort to meet the Maastricht criteria and preserve critical funding areas for security, healthcare, and research and development (R&D).
Decisions Made 2
The first reading has concluded; the next steps for the draft bill are as follows: the deadline for submitting amendments is June 12th at 4:00 PM.
The proposal by the Center Party faction to reject the bill during the first reading did not pass; the voting result was: 15 in favor, 50 against, 1 abstention. The first reading of the bill has concluded.
Most Active Speaker
Andrei Korobeinik, representing the Estonian Centre Party faction, right-wing. He was the most active speaker, drawing attention to issues and submitting numerous questions and comments. He structured the debate around topics crucial for voters, including accelerating investments, the soundness of budget measures, and the balance between revenues and the scale of spending.
Aseesimees Toomas Kivimägi
AI Summary
The Riigikogu now proceeds to the second item on the agenda: the first reading of Draft Law 456, the government-initiated bill on the 2024 supplementary budget. Minister of Finance Mart Võrklaev is invited to present the report.
Rahandusminister Mart Võrklaev
AI Summary
The Parliament adopted the 2024 state budget, and the government subsequently introduced a negative supplementary budget. The purpose of this supplementary budget is to ensure fiscal sustainability, reduce the deficit below 3% of GDP, and narrow the gap between revenues and expenditures. It incorporates €115 million in savings measures and €68 million in revenue measures, while also seeking to accelerate the implementation of investments and preserve defense capability and the state's economic flexibility.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Speaker Toomas Kivimägi thanked the audience, invited them to ask questions, and then asked Aleksandr Tšaplõgin to answer.
Aleksandr Tšaplõgin
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
He asks how the supplementary budget might affect the outlook for economic recovery, and whether economic growth was even considered when drafting it.
Rahandusminister Mart Võrklaev
AI Summary
Finance Minister Mart Võrklaev stated that the government is focusing on economic growth, ensuring that 70% of investments and investment grants are covered by commitments by August, with the goal of reaching 100% coverage by the end of the year. He added that the government will not knowingly reduce investments and will make adjustments if necessary. Furthermore, the negative supplementary budget will maintain the sustainability of public finances with a 3% deficit and stimulate the economy, all while monitoring the impact of interest costs and the country’s credit rating.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi invited Vadim Belobrovtsev to take the floor.
Vadim Belobrovtsev
Profiling Eesti Keskerakonna fraktsioonAI Summary
He asks why the budget drafting was left until the last minute, and whether the reason is the fear of making unpopular decisions before the elections, or simply disrespect toward the Riigikogu.
Rahandusminister Mart Võrklaev
AI Summary
Finance Minister Mart Võrklaev said that due to the worsening of the economic forecast, a negative supplementary budget was quickly prepared through consensus in order to bring the 2024 budget back to its intended level. He added that this measure is open to the public and the Riigikogu (Parliament) and is not related to elections.
Aseesimees Toomas Kivimägi
AI Summary
Vice-Chairman Toomas Kivimägi invites Andrei Korobeinik to the stage.
Andrei Korobeinik
Profiling Eesti Keskerakonna fraktsioonAI Summary
Andrei Korobeinik argued that even though the general budget is fixed and there won't be any savings made on security, the Ministry of the Interior's cuts still hit security—for example, the purchase of police cars is being postponed—and he questioned whether these cuts don't, in fact, concern security.
Rahandusminister Mart Võrklaev
AI Summary
Mart Võrklaev said that in 2024, the Ministry of the Interior will not face major savings measures or cuts; instead, the budget grew by 23 million, and a one-time sum of 3 million will be added, along with a transfer from previous years. As a result, money remains unused, and the problem is not a lack of funds or a decrease in security. Rather, resources have simply been added, and they are not always used for their intended purposes.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi asks Margit Sutrop to take the floor.
Margit Sutrop
Profiling Eesti Reformierakonna fraktsioonAI Summary
Margit Sutrop pointed out that the reduction of the state budget decreases the research, development, and innovation budget, and the 1% of public sector RDI expenditures does not align with the 0.77% requirement set out in the Frascati Manual, because the Ministry of Finance includes various additional costs that support research, which the agreement does not cover.
Rahandusminister Mart Võrklaev
AI Summary
In the supplementary budget, we will allocate 1% of GDP to research and development, as agreed, because tax revenues are not growing according to forecasts, and the state cannot spend more money than it has, which is why the deficit is about 1.1 billion, and this funding will come from borrowed money, but the agreement remains in force.
Aseesimees Toomas Kivimägi
AI Summary
Vice-Speaker Toomas Kivimägi invites Anastassia Kovalenko-Kõlvart to take the floor.
Anastassia Kovalenko-Kõlvart
Profiling Eesti Keskerakonna fraktsioonAI Summary
The report indicates that the total cuts to operating grants provided to foundations and companies amount to 6 million euros (5 million allocated to the Foundation for Entrepreneurship and Innovation and 2.5 million to the tourism sector). The anticipated effect is a revenue reduction of 20–30 million euros, clearly showing that short-term savings will result in greater future damage. How were such short-sighted decisions ever approved?
Rahandusminister Mart Võrklaev
AI Summary
Minister of Finance Mart Võrklaev said that the state must plan spending in line with revenues, and if revenues are lower, expenses must be scaled back. He added that for the Entrepreneurship and Innovation Foundation, the specific area for savings is up to them to decide, following the ministry's guidelines, even though budget forecasts anticipate a drop in revenues.
Aseesimees Toomas Kivimägi
AI Summary
Vice-Chairman Toomas Kivimägi called Aleksei Jevgrafov forward.
Aleksei Jevgrafov
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
I ask why the Health Minister’s stance on maintaining or increasing services contradicts your supplementary budget bill, which proposes a 1% reduction in operating costs for hospitals, given the increased number of patient consultations and the expiration of contract funding at the end of the year.
Rahandusminister Mart Võrklaev
AI Summary
Finance Minister Mart Võrklaev stressed that he is neither attacking nor operating with a "quick loan mentality," and he called for a substantive and constructive debate. He noted that the state budget is running a large deficit and argued that cutting healthcare costs is reasonable—for instance, by reviewing management and personnel expenditures by 1%. He added that without additional funds, expenses must be covered by borrowing, even though having more money would allow for better resource allocation.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi invites Andrei Korobeinik to the stage.
Andrei Korobeinik
Profiling Eesti Keskerakonna fraktsioonAI Summary
Andrei Korobeinik references the interviews given by Andrus Ansip, pointing out that the economy has been declining for nearly three consecutive years. He then poses questions regarding the supplementary budget, specifically concerning the scale of the cuts to special welfare services—particularly those for children—and whether such cuts are justified. Furthermore, he expresses skepticism about the EAS proposal and questions its overall sensibility.
Rahandusminister Mart Võrklaev
AI Summary
The state is currently reviewing historical expenditures, identifying areas for savings at the level of every ministry, and streamlining the organization of services. Furthermore, although some sectors have more planned resources than necessary, there are no plans to reduce specific support for anyone.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi asks Vadim Belobrovtsevi to come forward.
Vadim Belobrovtsev
Profiling Eesti Keskerakonna fraktsioonAI Summary
Vadim Belobrovtsev voiced concern that the media is portraying the supplementary budget as merely the tip of the iceberg and a trifle, and he asked the minister whether he could give us assurance that he would not present a second negative supplementary budget to the Riigikogu this autumn.
Rahandusminister Mart Võrklaev
AI Summary
Finance Minister Mart Võrklaev stated that the supplementary budget was adopted to streamline the country's finances, as the 2024 budget requires cutting costs and implementing tax changes in order to bring the deficit down to 2.9%, or approximately 1.1 billion euros. He added that although the economy is showing the first positive signs, it is still necessary to continue reducing expenditures and await the adoption of these tax changes by the Riigikogu (Estonian Parliament), so that supplementary budgets will not be needed during the 2025 budget process.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi invites Anastassia Kovalenko-Kõlvart to come forward and speak.
Anastassia Kovalenko-Kõlvart
Profiling Eesti Keskerakonna fraktsioonAI Summary
He/She thanks the minister, accuses the government of blaming the Center Party, and holds Kaja Kallas responsible for the economy. He/She also recalls the Reform Party's earlier pre-election funding and notes that the figures related to the cuts presented in the explanatory memorandum are inaccurate, while simultaneously asking how much these cuts will actually reduce revenues.
Rahandusminister Mart Võrklaev
AI Summary
Finance Minister Mart Võrklaev explains that the negative supplementary budget measures reduce the collection of turnover tax (VAT) and income tax, and this impact, which must be taken into account when reducing the budget deficit, is detailed on pages 11–12 of the explanatory memorandum.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi thanked the participants and stated that there were no further questions. He then announced that Annely Akkermann, Chairman of the Finance Committee, would present the discussion held in the Steering Committee and the decisions that were adopted.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann described the discussion held in the Finance Committee, during which they assessed the sufficiency of the 183 million euro saving measure, addressed compliance with the Maastricht criteria and the necessity of improving the GDP figure by 2.6%. Furthermore, it was decided to submit the draft bill to the plenary session for the first reading and to provide additional information to the Finance Committee.
Aseesimees Toomas Kivimägi
AI Summary
The Deputy Chairman thanked [the assembly] and requested one question be asked, calling upon Aleksandr Tšaplõgin to present it.
Aleksandr Tšaplõgin
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
He/She asks whether the Commission discussed the supplementary budget’s impact on the prospects for economic recovery.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann pointed out that this hadn't been discussed by the committee, and while general theory suggests a deficit ought to stimulate economic growth, in reality, it causes inflation, making it a highly ambivalent measure.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi called upon Aleksei Jevgrafov to speak.
Aleksei Jevgrafov
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
The speaker asks whether the one percent reduction in hospitals' operating costs was discussed in the committee, and what the rapporteur's attitude toward it is.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann notes that the minister spoke about this in their presentation, but it did not receive further discussion in the committee, and she considers this reasonable and believes that increasing the 1% residue should not be very complicated.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi thanked the participants and concluded the question period. He then opened the floor for debate and invited Urmas Reinsalu to speak on behalf of the winning party, the Isamaa faction. Reinsalu subsequently requested an additional three minutes.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu claimed that the coalition's budget is overstated and that actual governing costs will not decrease. He called on the government to listen to the will of the voters and adjust its policy, and promised that Isamaa would present a comprehensive alternative supplementary budget focusing on cost savings and avoiding tax increases.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi gives thanks and yields the floor to Priit Lomp, who represents the Social Democratic faction.
Priit Lomp
AI Summary
The speaker thanks everyone and requests three additional minutes of time.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi said that the speech would last a total of eight minutes.
Priit Lomp
AI Summary
He asks why he was not introduced as the representative of the party of the candidate who received the most popular vote and achieved the best result.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Chairman Toomas Kivimägi spoke about the election victory.
Priit Lomp
AI Summary
Priit Lomp said that the supplementary budget must be approached substantively, not through across-the-board cuts, in order to protect local governments and the social sector, and to keep national defense and internal security intact. He also stressed taxing the wealthy to increase revenue, which is why the Social Democrats are supporting the supplementary budget.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi offered his thanks and gave the floor to Andrei Korobeinik on behalf of the Centre Party faction.
Andrei Korobeinik
Profiling Eesti Keskerakonna fraktsioonAI Summary
Andrei Korobeinik criticizes the supplementary budget as a plan rooted in lies and cuts, which introduces income tax on the average pension and slashes funding for welfare services for children with special needs, internal security, and the Police and Border Guard Board. He stresses that the country is being poorly governed and that alternative budgets reveal the true long-term costs, meaning this supplementary budget cannot be supported.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Speaker Toomas Kivimägi said that the debate would be extended by three minutes.
Andrei Korobeinik
Profiling Eesti Keskerakonna fraktsioonAI Summary
Andrei Korobeinik criticizes the government's economic policy as having an "SMS-loan mentality" and outlines three steps to save the budget: abolishing tax breaks for the wealthy, reducing the number of state officials, and implementing a special profit tax on banks. He warns that without these changes, the economic recession will continue both this year and next year.
Aseesimees Toomas Kivimägi
AI Summary
Deputy Speaker Toomas Kivimägi asked Maris Lauri to take the floor on behalf of the Reform Party faction. The speech will last a total of eight minutes. He stressed that the text includes the phrase 'to reject' and that there must be no interruptions.
Maris Lauri
Profiling Eesti Reformierakonna fraktsioonAI Summary
Maris Lauri confirms that the financial standing of the Estonian state is poor, and the deficit will grow if the budget is not quickly corrected. Consequently, spending must be wisely reallocated and debts reduced, and substantive decisions must be made by August to find a common understanding and ensure the country's financial resilience.
Aseesimees Toomas Kivimägi
AI Summary
Kert Kingo was invited to speak on behalf of the EKRE faction, and the total duration of the address is eight minutes.
Kert Kingo
AI Summary
The Riigikogu is urged not to cut critical services for children, including rehabilitation, special welfare services, family mediation, increasing the competence of substitute care, the Children's House, spiritual care, counseling for abandoning violence, and psychosocial crisis aid, because reducing these services would create greater societal costs in the future and are necessary to ensure a sustainable, safe, and healthier future for Estonian society.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi announced that the lead committee's proposal was to conclude the first reading of Draft Bill 456, but the Estonian Centre Party faction submitted a proposal to reject the first reading, and he will put it to a vote.
Aseesimees Toomas Kivimägi
AI Summary
The first reading of Proposal 456 has concluded, and it failed to gain support (15 in favor, 50 against, 0 abstentions). The deadline for submitting amendments is June 12 at 4:00 PM. The procedure for the first item on the agenda is finished; in fact, we have already moved on to the second.