Palo wants to take over development of Ida-Viru County

Lennart Ruuda
, reporter
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Photo: PP

Minister of Enterprise Urve Palo wants to take the Ida-Viru County national development program away from Minister of State Administration Mihhail Korb as she finds the current plan is unable to kick-start life in the region.

Ida-Viru County is Estonia's problem child based on more than one socioeconomic indicator. Its population is shrinking and aging the fastest, its unemployment rate, number of people living in relative poverty, crime rate the highest.

That is why the government tasked the state administration minister with populating the Ida-Viru program with concrete activities aimed at improving conditions in the area. Korb, who is originally from the town of Kohtla-Järve, made it his priority to develop the area.

“In order for Ida-Viru County to be economically and culturally developed, sport a high-quality living environment, and be socially coherent, it is necessary for all ministries to contribute and pursue purposeful action,” Korb wrote to his fellow ministers toward the beginning of the year.

He received a rather sharp reply from Minister of Enterprise and Information Technology Urve Palo in March. Palo found that the current development plan should be discarded and replaced with a new activity program under her stewardship that would sport a clearer goal with specific targets, activities, and financing plans.

Palo says that the current development plan is inefficient and unable to deliver a sufficient impulse to the forsaken area. She believes the plan lacks focus and purpose. “The next regional development plan could be much more specific, sport sustainable financing, and be managed on the state level,” Palo said.

The minister has a concrete proposal as concerns financing: the environmental fees act should be amended in a way to give 25 percent of revenue from oil shale pollution taxes to a foundation, for example Enterprise Estonia, to be used to execute the Ida-Viru program.

Since pollution fees contribute nearly €43 million to the state budget annually, the money reserved for the county would come to around €9 million. Palo believes the money could be used to help attract foreign investments to alleviate, if only, unemployment in the area. The money could help develop the urban environment and housing fund,” the minister found.

“The housing situation is very poor in Jõhvi and Kohtla-Järve; investments are needed for renovation, construction, and demolition. Launching the Narva Free Stage theater center's creative incubator also requires funding, as does the language houses project,” Palo said. The minister added she has more ideas with which to liven up the county.

Palo's financing proposal is based on the fact that towns like Kiviõli, Kohtla-Järve, and Narva have never been compensated for damages caused by mining and processing of oil shale in the area. Money has only been made available to smaller rural municipalities in the mining region.

Minister Korb's reply to Palo states that the current development plan is substantial, and furthermore that it is working. “It has five specific, quantifiable goals,” Korb emphasized. Talking about problems, Korb said there is not enough money for activities.

When asked what he thinks about Palo's initiative to take over curating the program, Korb remained diplomatic and merely said his fellow minister is offering cooperation. “Considering the challenges in the county, we believe it is necessary to cooperate with the Ministry of Economic Affairs and Communications and others,” he added. Korb plans to take his program forward and present it to the cabinet in April.

As concerns using environmental fees to finance the program, Korb admits the idea has merit. “There are some strong arguments here; however, the matter requires further consideration.”

Minister of the Environment Marko Pomerants was critical of Palo's idea. He stressed that pollution taxes paid on mining oil shale need to be used specifically for reaching environmental targets, which is what the environmental investments center is doing. That is why Pomerants is against handing funds over to Enterprise Estonia for example.

Pomerants agrees, however, that national programs in Ida-Viru County should be managed through clear goals, indicators, and activities.