National Audit Office: Future decline in EU support needs attention now

According to the Estonian National Audit Office, the assessments forwarded to ministries show that the state uses EuropeanUnion support also for financing activities necessary for the long term and the state should prepare for the situation where EU support will decrease in the new budgetary period.

On Wednesday the audit office published eight audits, which focus on the role of European Union support in the various areas of the functioning of the state of Estonia, and a report that summarizes them all. The annual report of the National Audit Office submitted to the Riigikogu in early November highlighted that the state should prepare for the situation where EU support will decrease in the new budgetary period – according to the Ministry of Finance by about 40 percent or 1.5 billion euros without considering the impact of Brexit - writes err.ee.

According to the ministries, 90 percent of the activities currently funded with EU support will remain necessary after 2020 as well. The state has functions and activities that have partly been funded with EU support instead of using the state's own revenue. A good example is the development of the road network, which will be financed with EU support to the extent of around 36 percent from 2014 to 2020. The implementation of the capacity for work reform has also mainly been funded with EU support and it is also used to finance the provision of several labor market services. Approximately 85 to 90 percent of the funds used to support entrepreneurship and regional development also come from EU funds, it is written in the general audit report.

The ministries hope that the necessary activities will be financed from the state's other revenue after the decrease in EU support. The activities that in the opinion of the ministries will remain necessary in the future are financed with EU support in the amount of 3 billion euros in the current period.

According to the ministries, a significant decrease in the funding of the activities financed from EU support that will remain necessary in the future would concern many functions and goals of the state.

The Ministry of Finance does not consider necessary drawing up a separate strategy for preparing for the decline in EU support because according to the ministry all such issues would be solved in the budget.

The National Audit Office finds that the Ministry of Finance should provide a detailed explanation, schedule and action plan in the state's budgetary strategy for 2019-2022, which would show how the state is preparing for the probable decrease in European Union support and which processes are used. The state's needs, possibilities and cost alternatives in the case of decreasing foreign support must be analyzed and treated in a comprehensive and understandable manner. The Riigikogu should also be included in the planning of the next budgetary period of the European Union in order to set more broad-based priorities.

Estonia has received billions of euros worth of non-refundable foreign aid since its independence was restored. During the 2014-2020 budgetary period the European Union is supporting Estonia from its structural and investment funds to the value of 4.4 billion euros. Approximately 3.5 billion euros of this amount is earmarked for the development of education, enterprise, transport, the information society and the environment as cohesion policy support and around 900 million euros for agriculture and fishery. The overview prepared by the National Audit Office does not touch on agriculture and fishery, since support for these fields is determined on a separate basis that is not linked to the country's GDP or GNI indicators.

In the last 10 years, approximately one half of the public sector investments and about 11 percent of the state budget expenditure of Estonia have been covered from foreign aid, mostly the support of the European Union.

Estonia will probably have significantly less support funding at its disposal in the budgetary period of the European Union that starts in 2021. The amount of money to be allocated to Estonia is not known yet, but even if the impact of the United Kingdom's withdrawal from the European Union is not taken into account, support funds will decrease by up to 40 percent or around 1.5 billion euros compared to the current budgetary period according to the initial estimates of the Ministry of Finance.

Editor: Dario Cavegn

Source: BNS

Read more news of Tallinn on our site

err.ee
nationalauditoffice eusupport
If you notice an error, highlight the text you want and press Ctrl + Enter to report it to the editor
1 view in december
I recommend
No recommendations yet

Comments

Post your comment to communicate and discuss this article.

Society
At the Riigikogu sitting beginning at 10:00 EET on Tuesday, Prime Minister Jüri Ratas (Centre) will provide an overview of the activities of the Estonian government in the implementation of EU policies. Chairman of the European Union Affairs Committee of the Riigikogu Toomas Vitsut (Centre) will also deliver a report, and representatives of the Riigikogu's parliamentary groups will present their positions, according to a Riigikogu press release. In his rep...
Society
Chairman of the opposition Conservative People's Party of Estonia (EKRE) Mart Helme has called on Helir-Valdor Seeder, chairman of junior coalition member Pro Patria to tie the latter's support for the state budget bill to a decision by the government not to support joining the UN Global Compact on Migration. "Pro Patria still has the chance to demand from its coalition partners [the Center Party and the Social Democratic Party (SDE)] that its stances be t...
Society
Political news portal Politico published its list of the most influential people in Europe next year last week, with fifth place going to Estonia’s cybersecurity ambassador Heli Tiirmaa-Klaar. Tiirmaa-Klaar takes her place in between well-known Europeans, after Secretary General of the European Commission Martin Selmayr and in front of Ukrainian presidential hopeful Yulia Tymoshenko. Politico believes Italy’s populist interior minister Matteo Salvini will...
Society
Representatives of the transport ministries of the Baltic states, Finland and Poland who met in Tallinn on Monday were of differing opinions regarding whether to remain in summer or winter time once the practice of changing the clocks twice per year comes to an end. A recent survey indicates that more than half of Estonians would prefer permanent summer time. Estonia, Latvia, Lithuania, Finland and Poland jointly acknowledged that the agreement to end the...
Society
Ida-Viru Central Hospital is having trouble with patients not showing up to scheduled specialist appointments. To combat this issue, beginning next year, the hospital will start charging visit fees for no-show appointments as well. Last year, patients at Ida-Viru Central Hospital failed to show up for scheduled appointments a total of nearly 9,500 times, accounting for some 5% of all hospital visits, reported ETV news broadcast Aktuaalne kaamera. "Patients...
Society
Tallinn city government finds that it is not reasonable to relocate the Tallinn Bus Station to the Ülemiste district near Tallinn Airport and that it should be left in its current location on Lastekodu Street. In connection with the preparation of an architectural idea competition and the drawing up of a detailed plan for the Ülemiste terminal in the framework of the Rail Baltic railway project, the city is drawing the attention of the Ministry of Economic...
Society
A criminal investigation has been launched into the Medita Clinic, one of the largest private sector bidders in public procurement tenders in the health sector in Estonia. The Northern District Prosecutor's Office initiated the investigation in accordance with the Penal Code section concerning the transmission of false information, according to ETV investigative show Pealtnägija. The Medita Clinic was the largest private provider of specialist medical care...
Society
The Tax and Customs Board (MTA) has signed an agreement with Online accommodation and hospitality marketplace Airbnb which enables hosts to automatically report earnings. The MTA and Airbnb held a joint press conference on Wednesday, announcing the agreement's signing as well as the new system and its rationale. The main premise, according to MTA deputy director Rivo Reitmann, is to keep things simple, meaning that Airbnb hosts who declare their income in...
Society
Luminor notified its clients that as of 1 January, the bank will be closing the accounts of Estonian e-residents that fail to fulfil due diligence. Hannes Oja, head of Anti-Money Laundering at Luminor Estonia, said that based on the Money Laundering and Terrorist Financing Prevention Act, banks are required to update the data of all of their customers, writes daily Eesti Päevaleht (EPL). As a result, all existing clients have to do so themselves on a regul...