Prime minister: 'We want to resolve the situation'

Prime Minister Kaja Kallas (Reform) Photo: Remo Tõnismäe

The coalition council will convene on Monday to discuss further energy price compensation measures. Prime Minister Kaja Kallas (Reform) says in an interview that the sides will do everything they can to reach an agreement.

Were there consultations over the weekend?

Consultations with various parties, including with [chairman of coalition partner the Center Party] Jüri Ratas were held throughout the weekend.

Could the new week bring clarity in terms of additional measures? Might we see concrete proposals on Monday?

We have been working toward that goal the entire weekend, discussed electricity market bottlenecks, considered how sellers could offer favorable prices, especially as concerns private consumers’ fixed contracts.

We also focused on the fact that legal persons have developed liquidity problems in the conditions of soaring electricity prices and how to solve it, how to offer them help to avoid a snowball effect where one bill going unpaid causes another set of bills and then employees to go unpaid. That is not something we want to see happen, which is why we have been discussing what kind of help the state could offer businesses.

Does that mean that various proposals rather than specific instruments are on the table?

Parties have made several proposals. We will discuss all of them and decide which ones are feasible.

How much flexibility and preparedness for compromise can be found in the Reform Party and the Center Party in your opinion? Or are the sides rigidly clinging to their positions?

The one thing we all agree on is that the situation is complicated. Home consumers are in trouble after receiving shocking power bills [for December] as are legal persons who have failed to manage risks or fix prices. We all see the situation the same way.

But we cannot forget that we have several measures in place already. We have lowered the power transmission fee for all consumers by 50 percent and the gas transmission fee by 100 percent, as well as introduced a targeted measure for median income households.

Local governments started processing applications in early January, with the first sums paid out more or less as we speak. The measure is designed to help 380,000 households. We need to have clear data to suggest the current measure is not working, helping people. And then we must decide how to change it.

We must not forget that support and benefits come out of the taxpayer’s pocket. We are responsible for making purposeful use of taxpayer money.

For example, Latvia has a measure for 110,000 households that will receive €10-30 a month. Heating benefits will only reach 10,000 households in Lithuania. The volume in GDP of Estonia's existing measures is many times that of schemes employed in Ireland, Norway, France and Italy.

We now have two choices. We can either pay everyone’s way – pay everyone a little – or we can aim benefits at people who really need them. That is why we must look for ways to make the existing measure work if it currently doesn’t. That is our negotiating position.

I believe we both want to resolve the situation, considering that the problem is far from short-term.

Could the new week bring a concrete solution and clarity even if you cannot fully agree on something?

The thing with benefits is always that those who qualify will find they are too little, while those who don’t say the former are ill-deserving. They cannot be used to make people happy. We cannot simply pay everyone’s electricity bill. Power is not free.

That said, we will do everything we can to arrive at the best possible solution.

However, we first need to answer the question whether existing measures are not enough. We have changed and improved them twice already. Allow me to recall that we went from the power transmission measure to gas transmission, followed by the first variant of the targeted measure aimed only at least fortunate families that was then bumped up to include median income families. Therefore, we had already changed the measures twice before we had information to suggest they are not sufficient.

The existing targeted measure is forecast to cost a certain amount of money. Is the government willing to allocate more funds to support companies and individuals?

Additional measures will require addition funding. We will not be dialing back existing ones.

How expensive could these new measures be? What kind of sums are we talking about?

That depends on what will need to be done, what we will decide. We need to pinpoint the problem current measures fail to address.