NordenBladet – On Friday an honorary Estonian consulate was reopened in Bordeaux, France to enable better business links with the region of Nouvelle-Aquitaine. Jacques de Galzain has became Estonia’s new honorary consul in Bordeaux, France.
Andre Pung, the Director of the Western Europe Division at the Department for European Affairs of the Foreign Ministry, presented Jacques de Galzain with the honorary consul patent today. His consular region will cover Nouvelle-Aquitaine.
The new honorary consul and the reopening of the honorary consulate makes it possible to further deepen cooperation between Estonia and the Nouvelle-Aquitaine region, and boost business and cultural relations. It also enables Estonia to provide better consular services to Estonian citizens.
Estonia’s new honorary consul Jacques de Galzain is an auditor and a partner at Grant Thornton and the director of its Bordeaux office.
Pung thanked Estonia’s former honorary consul in Bordeaux, Christian de Barillon, for his long and excellent work and presented him with the Order of the Cross of Terra Mariana, 4th Class, issued by the decision of the President of the Republic of Estonia.
NordenBladet —Members of the Estonian Delegation to the NATO Parliamentary Assembly (PA) Ants Laaneots, Leo Kunnas and Sven Sester attend the Annual Session of the NATO PA in London.
Member of the delegation Ants Laaneots said that he intended to ask Secretary General of NATO Jens Stoltenberg in London what would be NATO’s response to the decision of the USA and Russia to withdraw from the Intermediate-Range Nuclear Forces Treaty. “I would like to know what NATO and the European Union intend to do to defend themselves against Russia’s intermediate range missiles because the EU itself does not have intermediate range missiles,” Laaneots explained.
Member of the delegation Sven Sester thinks that the main purpose of the NATO PA is the cooperation of member states in defence and security issues. “In order to meet the targets set for the alliance, governments of the allied states have to bring their defence expenses to the agreed-upon level of two per cent of gross domestic product. NATO increases the security of each member state, and Estonia continues to support fairer and more even distribution of expenses in contributions to operations and the presence of the allies,” Sester said.
The Committees of the Assembly will consider and assess several reports.
The Committee on the Civil Dimension of Security will discuss border security and addressing the refugee crisis. Corruption and human rights situation in Russia and Ukraine will also be spoken about.
The Defence and Security Committee will deal with responding to the Russian challenge, and the issues relating to nuclear deterrence and arms control. Transatlantic defence and security cooperation and renewing the strategy toward Iran will also be discussed. The Committee will also consider the resolution on supporting allied forces and their international partners’ efforts in Afghanistan.
The Economics and Security Committee will speak about British trade policy after the UK’s withdrawal from the European Union, including the trade relations with the EU, USA and Canada. The reports of the Committee also concern digital markets and cyber security, and the developments in North Macedonia and their NATO accession. The efficacy of international sanctions in relation to Russia will be discussed as well.
The topics of the Political Committee focus on the 70 years of the activities of the Alliance and the state of play of transatlantic relations. The reports analyse the challenges and opportunities for NATO in ensuring security and stability in Africa, and the regional security dynamics in the Gulf Region.
The Science and Technology Committee will consider technology trends and artificial intelligence in security. The main topic of discussion will be NATO in today’s cyber age, and strengthening of security and defence.
NordenBladet —The matter of significant national importance “The Future of Pension – Who Will Provide for the Elderly?”, initiated by the Social Democratic Party Faction, was deliberated at the Riigikogu today.
Presentations were made by the Head of the Management Board of Praxis Center for Policy Studies Tarmo Jüristo, Senior Research Fellow of Tallinn University Lauri Leppik, doctoral student of the University of Tartu and economic expert Kaspar Oja, and member of the Social Democratic Party Faction Riina Sikkut.
Tarmo Jüristo said that the theoretic net replacement rate of the Estonian pension system is the lowest in the European Union at around 40 %. Estonia has the highest at-risk-of-poverty rate in the EU among the over 65 year olds who live alone, amounting to nearly 80 %. As a large proportion of the people aged 65 and over receive income that is close to the poverty threshold, even the slightest drop in the relation between salaries and pensions leads to a rapid increase in the number of people living at risk of poverty, Jüristo warned.
“Estonia leads the ranking in Europe in the employment rate of people over the pension age, which is reflected in the lowest relation between the average length of retirement and of working career among the Member States. Whichever way you look at these numbers now, the current situation leaves no doubt that social problems will appear in the future, followed by political pressure to push Estonia’s pension system towards a wider choice. It is more than likely that there will be considerable pressure towards increasing the volume of funds in the Estonian pension system in the future,” Jüristo said.
The second pillar foundations in Estonia hold a total of EUR 4.5 billion. “This is the money we have been putting aside over the last 17 years individually and collectively, and it should reduce the burden of the next generation to fund our pensions,” Jüristo said. Jüristo sees further ways to enhance the second pillar disbursements system, which has already been considerably improved by the recent changes. “The risk profiles of foundations and the choice of foundation by the individuals across their life cycles can be further optimised, more information can be provided, and average service fees have plenty of room to come down. All this creates the conditions for higher productivity than has been achieved so far.”
Lauri Leppik spoke about the two fundamental ways of funding pensions. “The first is something we call permanent financing, inter-generation redistribution; and the second, what we call pre-financing, where every generation collects their own pension funds,” Leppik explained. Very many European countries use what he termed as a mixed model, i.e. using both permanent and pre-financed pension systems; sometimes such mixed financing is used within one pension system.
Leppik said that in a situation where the Estonian replacement rate of the first pillar with its permanent financing is one of the lowest in Europe, an individual who wants to rationally plan their future, not depend financially on their offspring, and disperse risks, but is able to save money only in small instalments, has very few opportunities, other than to turn to a pre-financed pension scheme. “Because it is not possible to buy additional pension from the state; the state does not provide that service, and sadly would also be unable to provide it,” Leppik said.
“Estonia’s second pillar pension foundations have attracted severe criticism, and I do agree that some of that has been well justified. However, we could view the second pension pillar as a cooperation effort between the public and the private sector. The private sector is providing a public service,” Leppik added.
Kaspar Oja focused on collecting pensions in the context of macroeconomics. He sees the topics around ageing and pensions gaining increasing importance in the society. In light of the demographic situation, less people are of the age to enter the labour market than in the age to leave it; over the last years, nearly 6,000 less have entered the market than left it, and Oja does not foresee this situation changing.
He does not think it’s enough to simply save for retirement. “In order to live off the pension alone, purely thanks to savings and with no insurance solutions, one should save up significantly more than would actually be efficient. In order for funded pensions to work, we need some sort of insurance solutions, we need the kind of payment solutions that would allow us to pay pensions in the long term,” Oja said.
Oja also said that the slowing down of Estonia’s economic growth reflects similar past developments in Finland. “The first pillar system, which is based on the tax revenue, is unlikely to ensure us growth as quickly as capital revenue would, if the investments have been made in sufficiently numerous instruments.”
Riina Sikkut stressed the need to remember that we are developing our pension system for the benefit of the people. She listed four aspects that should not be forgotten: people want to receive more in the future; theoretic knowledge that the people have does not translate into their behaviour – neither in taking care of their health nor their personal finances; there is massive inequality of incomes and assets – it would be useful to keep an eye on the income distribution curve when changing taxes, pensions, or any other benefits; children are not a pension pillar – the economic coping of an elderly person cannot depend on whether they have children, and what the financial situation of their children is like.
“We are already feeling a pressure towards an extraordinary increase in pensions, and we are seeing how difficult it is to secure even a seven euro increase,” Sikkut said. “In a situation where the percentage of working-age population is falling, we are unable to ensure a living pension from the current taxes. And of course it makes sense to find other solutions as well, whether they involve saving up for your own retirement, or something else. The second pillar can be improved but it would be irresponsible to jeopardise the coping of the future pensioners to such an extent for the benefit of short-term gains tomorrow,” she added.
During the debate, Indrek Saar (Social Democratic Party), Jürgen Ligi (Reform Party), Tõnis Mölder (Centre Party), Urmas Espenberg (Estonian Conservative People’s Party), Priit Sibul (Isamaa), Heljo Pikhof (Social Democratic Party), Oudekki Loone (Centre Party), Aivar Sõerd (Reform Party), Heiki Hepner (Isamaa) Kalle Grünthal (Estonian Conservative People’s Party) and Andres Sutt (Reform Party) took the floor.
NordenBladet —At today’s sitting of the Riigikogu, the Bill on Estonia’s membership of the European Space Agency that would allow a larger amount to be allocated to projects targeted at Estonia passed the first reading.
The Bill on the Ratification of the Rider Modifying the Agreement between the Government of the Republic of Estonia and the European Space Agency concerning the Accession of Estonia to the Convention for the Establishment of a European Space Agency and Related Terms and Conditions (49 SE), initiated by the Government, will provide for acceptance of the rider modifying the accession agreement in order to extend the integration period of Estonia’s membership of the European Space Agency (ESA) and to enable ESA to allocate a larger amount to projects targeted to Estonia.
Estonia became a full member of ESA on 1 September 2015. Under the Agreement between the Government of the Republic of Estonia and the European Space Agency concerning the Accession of Estonia to the Convention for the Establishment of a European Space Agency and Related Terms and Conditions, Estonia as a new member of ESA is entitled to six years of new member state status, and to participation in the Industry Incentive Scheme, targeted only at Estonia, in the amount of 500,000 euro a year. In 2018, the ESA reached the conclusion that the new member state status should last for nine years instead of six, and the minimum amount of a targeted allocation should be 750,000 euro a year in ESA’s opinion. The amount of this allocation has been determined in the ESA’s measure for new member states, which means that it will not affect Estonia’s contribution to the ESA or involve additional obligations. For the next six years, Estonia will enjoy better conditions than those initially agreed.
Two other Bills passed the first reading in the Riigikogu today:
The Bill on Amendments to the General Part of the Environmental Code Act and Other Acts (55 SE), initiated by the Government, will optimise the processes for environmental decisions and reduce the administrative burden in environmental law through consolidation and coordination of the proceedings for permits. The Bill is part of the codification of environmental law that was begun with the General Part of the Environmental Code Act. The requirements for the proceedings relating to environmental permits in the Acts of the special part of the Environmental Code will be systematised, controversies will be solved, and a basis for issuing a single environmental permit will be established. The Bill will eliminate parallel proceedings for environmental permits, reduce bureaucracy, and enable obligations arising from legislation to be fulfilled more conveniently and effectively.
The Bill on Amendments to the Consular Act and Amendments to Other Associated Acts (44 SE), initiated by the Government.
The amendments are intended to determine the list of consular acts in the event of which a consular secretary can also provide consular services. As the concept “consular secretary” is not in the current law at present, the concept is provided for in the Bill. Under the Bill, consular secretary is a member of staff working in a non-diplomatic post who can provide consular services, under the proposed amendments. The Bill also points out that the services will be provided under the supervision of a consular officer.
The amendments will not automatically involve the right of all consular secretaries to provide the services listed in the Bill, but the Bill will create the legal basis for such a possibility. The right to provide the services will be decided separately for each particular member of staff. Along with that, members of staff will be granted relevant access to the register of professional acts of a consular officer for registration of acts. Relevant training is a prerequisite for the right to provide the services and access to the register, among other things, with the aim of ensuring compliant and correct identification of persons.
Two Bills were dropped from the proceedings of the Riigikogu:
The Bill on Amendments to the Citizenship Act (37 SE), initiated by the Reform Party Faction, was intended to allow multiple citizenship for Estonian citizens who have acquired Estonian citizenship by birth. The Bill also provided for the possibility of resumption of Estonian citizenship for persons who had acquired Estonian citizenship before 26 February 1992 but who had been forced to renounce it or were deemed to have ceased to be Estonian citizens.
During the debate, Henn Põlluaas (Estonian Conservative People’s Party), Jürgen Ligi (Reform Party) and Oudekki Loone (Centre Party) took the floor.
The Constitutional Committee moved to reject the Bill at the first reading. 52 members of the Riigikogu voted in favour of the motion and 30 were against, and thus the Bill was dropped from the legislative proceedings.
The Bill on Amendments to the Basic Schools and Upper Secondary Schools Act and the Private Schools Act (39 SE), initiated by the Estonian Reform Party Faction, was intended to create the possibility for central evaluation of heads of school in terms of their work and development. With the implementation of the Bill, heads of school would have been given feedback with a view to supporting the professional development of heads of school. According to the explanatory memorandum, the amendments would have enabled to coach heads of school and, where necessary, to suspend them from the duties of head of school, if significant deficiencies were found in their work.
During the debate, Jürgen Ligi (Reform Party) and Siim Pohlak (Estonian Conservative People’s Party) took the floor.
The Estonian Conservative People’s Party Faction moved to reject the Bill at the first reading. 46 members of the Riigikogu voted in favour of the motion and 32 were against, and thus the Bill was dropped from the legislative proceedings.
NordenBladet – Estonia’s new ambassador to Sweden, Margus Kolga, presented his credentials to King Carl XVI Gustaf of Sweden on Thursday. The King and ambassador confirmed the good relations between the two countries and discussed Swedish-Estonian history.
Kolga thanked the Swedish state for the initiative of the Swedish-Estonian Cooperation Fund and acknowledged the support of the Swedish Foreign Service for the Estonian UN Security Council campaign.
The University of Tartu, it’s importance, and the role of Gustav Adolf Gymnasium in shaping the Estonian educational landscape were also discussed.
“Sweden is an important partner for Estonia both in Northern Europe, the European Union, and more broadly. Our common interests in security policy, our good and strong economic relations and ever-growing cultural exchanges provide a positive basis for further steps and new joint activities,” said Kolga.
Kolga started working for Ministry of Foreign Affairs since 2007 when he became director-general of the Political Department. Since 2010, he has been Ambassador to the Permanent Representation of Estonia to the United Nations in New York, and in 2015.
NordenBladet —The leaders of the Estonian national airline Nordica gave the Economic Affairs Committee of the Riigikogu (Parliament of Estonia) an overview of the situation and plans of the company, and the developments in the global aviation.
Chairman of the Economic Affairs Committee Sven Sester said that Estonia’s success was not possible without direct connections with the cities of other countries. Nordica was created for keeping these connections, but in Sester’s opinion, the company has distanced itself from its original purpose. “Therefore it is necessary to follow the performance and the setting of new targets of our airline very closely. If foreign airlines are not interested in Estonia and flying to Estonia, Nordica has to stretch its wings, because this is why the company was originally established,” he explained.
Sester added that according to the winter schedule of Tallinn Airport, it was possible to travel to 31 destinations with the planes of 13 different companies, but Nordica’s share in it had fallen to around ten destinations. “Due to competition and other difficulties, Nordica has suspended flights on certain routes, which is definitely not a good sign, but at the same time, the number of destinations together with other airlines is positive – in summer, it was possible to fly direct to 38 destinations, which is a new record of the latest periods,” Sester said.
Deputy Chairman of the Economic Affairs Committee Kristen Michal said that Nordica had been born out of the need to keep the connections that were necessary for Estonia, and to do it in a way that would be economically feasible. “The connections from Tallinn and Estonia yield a revenue of 100–200 million euro a year to the economy. The most important aspect for Estonia is having a company that can keep up and create competition, so that Tallinn Airport would work in the interests of customers,” he said.
Michal thinks that, at present, aviation is doing well, and Tallinn Airport has also done good work in creating new routes. “Nordica has to run itself so that, when competition decreases, it is capable of competing in the market – this is also the reason why it was established and is operating,” Michal said.
CEO Erki Urva and Chairman of the Supervisory Board Toomas Tiivel of Nordic Aviation Group AS gave an overview of the situation of the airline to the Economic Affairs Committee of the Riigikogu.
NordenBladet —At today’s plenary sitting, the Riigikogu concluded the first reading of two Bills that will ensure additional protection to people who work on ships.
The Bill on Amendments to the Seafarers Employment Act and the Maritime Safety Act (56 SE), initiated by the Government, will transpose into Estonian law two European Union directives, and Estonian law will be brought into conformity with the amendments to the Maritime Labour Convention of the International Labour Organization (ILO) that were passed in 2016.
Under the Bill, shipowners will have to conclude seafarers’ employment agreements with persons working on fishing vessels of less than 24 metres in length. At present, ordinary labour law regulation applies to persons working under a contract of employment on board such fishing vessels. Seafarers’ employment agreement ensures additional protection to workers. For example, the shipowner must ensure regular food and the provision of medical care on the ship. Fishing vessel means a vessel used for commercial fishing.
The Bill will also establish a financial security system to compensate for both abandonment of crew members and for costs for crew members in respect of occupational accident or disease. All shipowners whose ships must have a maritime labour certificate (ships of 500 gross tonnage or over) must have sufficient financial security. Liability insurance, a bank guarantee or another security that enables compensation to be paid may be financial security.
The explanatory memorandum notes that the minister responsible for the area will establish by a regulation the principles for evaluating the sufficiency and calculating the amount of the security. The Estonian Maritime Administration will evaluate the sufficiency of security upon the issue of maritime labour certificates. All ships flying the Estonian flag that have a maritime labour certificate already have liability insurance.
Under an amendment to the ILO’s Maritime Labour Convention, it is possible to extend an existing maritime labour certificate for up to five months upon expiry of the certificate. This is done where the ship has successfully passed the renewal inspection, but a new certificate cannot immediately be issued to the ship. Under the current law, there is no possibility to extend the certificate.
The Act enters into force pursuant to general procedure. Under the Bill, a transitional provision will be established under which employment agreements concluded with workers working on fishing vessels of less than 24 metres will be deemed to be seafarers’ employment agreements as of 1 January 2020. The employment agreements in force will have to be brought into conformity with the law by 31 December 2020.
The Bill on the Ratification of the Amendments of 2014 and 2016 to the Code of the Maritime Labour Convention of the International Labour Organization (75 SE), initiated by the Government, also passed the first reading.
The amendments of 2014 concern the obligation of the shipowner to have financial security for the event of abandonment of crew members and to cover contractual claims arising from occupational accident and disease. For example, liability insurance, a bank guarantee or another security that enables compensation to be paid may be financial security. For example, situations where the shipowner has left the seafarer without the necessary maintenance or has unilaterally severed their ties with the seafarer are deemed to be abandonment.
The amendments passed in 2016 concern the extension of maritime labour certificate in a situation where a maritime labour certificate expires and a new certificate cannot immediately be issued, but the ship has passed an inspection and it has been found to meet the necessary requirements for obtaining the certificate. In such a case, the validity of the maritime labour certificate can be extended by up to five months. Under the current law, there is no possibility to extend the certificate.
The amendments will affect in particular crew members and owners of ships flying the Estonian national flag and holding a maritime labour certificate, and the Estonian Maritime Administration. At the same time, the proposed amendments will have little impact because all ships holding a maritime labour certificate and flying the Estonian flag have P&I liability insurance, which covers the costs related to the repatriation and abandonment, and the injuries or death of crew members.
The Maritime Labour Convention was adopted on 23 February 2003 with the aim of establishing uniform principles to ensure decent working and living conditions for all seafarers. The Riigikogu ratified the Maritime Labour Convention on 23 February 2016, and it entered into force for the Republic of Estonia on 5 May 2017. Ninety-two member states of the ILO have ratified the Convention.
Two Bills were dropped from the proceedings of the Riigikogu:
The Bill on Amendments to the Environmental Charges Act (41 SE), initiated by the Social Democratic Faction. According to the Bill, at least 25 per cent of the environmental charges received into the state budget were intended to be distributed to the Ida-Viru County programme and the implementation of the activities specified therein. According to the explanatory memorandum, the amendment would bring around 20 million additional euro a year to the region.
The explanatory memorandum notes that the Ida-Viru County oil shale sector pays to the state the majority of the environmental charges accrued into the state budget, but that is not improving the local living environment as a whole in Ida-Viru County at present. Estonian oil shale industry companies pay an estimated average of 70% of all environmental charges.
During the debate, Peeter Ernits (Estonian Conservative People’s Party) took the floor. On behalf of the faction, he moved to reject the Bill at the first reading.
51 members of the Riigikogu voted in favour of the motion and 31 were against. Thus, the motion was supported and the Bill was dropped from the legislative proceedings.
The Bill on Amendments to the Citizenship Act (40 SE), initiated by the Social Democratic Party Faction, was intended to provide for the possibility to apply for Estonian citizenship by naturalisation to children of under 15 years of age who were born in Estonia and whose parent or parents either have undefined citizenship or are third country nationals and resided permanently in Estonia before 20 August 1991. The Bill will abandon the requirement of a residence permit of a long-term resident as a condition for applying for Estonian citizenship. The requirement that the applicant stay in Estonia legally on the basis of a residence permit or right of residence will be maintained.
During the debate, Jevgeni Ossinovski (Social Democratic Party) took the floor and called on to support the Bill.
Faction Isamaa moved to reject the Bill at the first reading. 74 members of the Riigikogu voted in favour of the motion and nine were against. Thus, the motion was supported and the Bill was dropped from the legislative proceedings.
The deliberation of the first reading of a Bill was adjourned due to the end of the working hours of the plenary:
The Bill on Amendments to the Citizenship Act (37 SE), initiated by the Reform Party Faction, will allow multiple citizenship for Estonian citizens who have acquired Estonian citizenship by birth. The Bill also provides for the possibility of resumption of Estonian citizenship for persons who acquired Estonian citizenship before 26 February 1992 but who were forced to renounce it or were deemed to have ceased to be an Estonian citizen.
NordenBladet —At today’s sitting of the Riigikogu, the Bill on Amendments to the Organisation of Research and Development Act (33 SE), initiated by the Social Democratic Party Faction, passed the first reading. It is intended to ensure stable funding of research and development by the state at the level of one per cent of GDP. This will support broad-based social development and facilitate greater added value of entrepreneurship.
“Science and higher education. Teachers’ salary, higher education and science, I would say, are an investment into the future. We have all agreed that defence spending has been fixed in law. Likewise, contribution to research also deserves to be set out in law as one per cent of gross domestic product as of 2022,” Katri Raik (Social Democratic Party) said when presenting the Bill.
The initiators of the Bill said in justification that the lag in the research and development funding hindered Estonia’s movement towards knowledge-intensive economy. The researchers’ labour market is international, and the limited research and development funding forces Estonian researchers to leave Estonia for countries with better research and development funding.
Member of the Riigikogu Mart Võrklaev took his oath of office.
During the open microphone, Jaak Juske took the floor.
NordenBladet —President of the Riigikogu Henn Põlluaas and President of Hungary János Áder met in Budapest to discuss challenges that achieving climate neutrality would set for energy security.
Põlluaas said that Estonia decided this week to join the European Union goal to achieve climate neutrality by 2050, this means that the carbon emissions of the country must not exceed its capture capacity. “We would like to focus on renewable energy solutions, but sadly technology today cannot offer us a quick substitute for oil shale. We can also expect investments that would be massive for a small country, as well as a socio-economic challenge because tens of thousands of jobs are tied to the oil shale industry,” Põlluaas said. He added that although the European Union does have support mechanisms for giving up coal, there are no support measures for oil shale.
The President of Hungary said that the new budgetary period of the European Union is currently being prepared, with an extra focus on climate related targets. He expressed his hope that these plans would also include measures for giving up oil shale.
This week, the President of the Riigikogu is on a visit to Budapest at the invitation of the Speaker of the Parliament of Hungary. The purpose of the visit is to promote bilateral relations and learn about the latest developments in Hungary. The President of the Riigikogu is accompanied on the visit by the Chairman of the Foreign Affairs Committee Enn Eesmaa, and member of the National Defence Committee Madis Milling.
NordenBladet —Head of the Estonian Delegation to the Parliamentary Assembly of the Council of Europe (PACE), member of the Riigikogu (Parliament of Estonia) Maria Jufereva-Skuratovski delivered a speech on labour migration from Eastern Europe and its impact on behalf of the Alliance of Liberals and Democrats for Europe (ALDE Group) at the PACE Plenary Session today.
In Jufereva-Skuratovski’s opinion, labour migration from Eastern Europe is a great problem. “Ukrainians stand out among the labour migrants from Eastern Europe – according to the data from 2017, there were more than 4.5 million of them. Besides the Ukrainians, there were 3 million Romanian, 2.5 million Polish and one million Bulgarian labour migrants. These are large figures, and if the labour migrants do not know how to stand for their interests, it will cause significant social problems for them and their families,” she said.
Jufereva-Skuratovski also spoke briefly about the situation in Estonia in her speech. “We, too, have very many labour migrants from Ukraine, and many of them come to Estonia with their families and children. There have been cases when labour migrants and their children do not have the necessary registrations, and the children therefore essentially have no right to study in school or go to kindergarten. I think that we have to find solutions to the problems concerning the labour migrants in cooperation with other countries,” Jufereva-Skuratovski said.
Estonia became a member of the Council of Europe in 1993. Our country is represented in the Parliamentary Assembly of the Council of Europe by the delegation appointed by the Riigikogu.