Identifier
Created
Classification
Origin
09TALLINN145
2009-05-22 14:36:00
CONFIDENTIAL
Embassy Tallinn
Cable title:  

ESTONIA'S PM DIMISSES COALITION PARTNER BUT

Tags:  PGOV PREL EN 
pdf how-to read a cable
VZCZCXYZ0006
RR RUEHWEB

DE RUEHTL #0145 1421436
ZNY CCCCC ZZH
R 221436Z MAY 09
FM AMEMBASSY TALLINN
TO SECSTATE WASHDC 1152
C O N F I D E N T I A L TALLINN 000145 

SIPDIS

E.O. 12958: DECL: 07/23/2018
TAGS: PGOV PREL EN
SUBJECT: ESTONIA'S PM DIMISSES COALITION PARTNER BUT
GOVERNMENT CONTINUES

CLASSIFIED BY CDA Karen Decker for reasons 1.4 (b) & (d).

REF: TALLINN 144

C O N F I D E N T I A L TALLINN 000145

SIPDIS

E.O. 12958: DECL: 07/23/2018
TAGS: PGOV PREL EN
SUBJECT: ESTONIA'S PM DIMISSES COALITION PARTNER BUT
GOVERNMENT CONTINUES

CLASSIFIED BY CDA Karen Decker for reasons 1.4 (b) & (d).

REF: TALLINN 144


1. (C) On May 21, Prime Minister Ansip jettisoned the smallest
partner (Social Democrats - SDE) in the ruling coalition
after the Government failed to reach agreement on 383 Million
EUR (6 billion eeks) in budget cuts. This weekend, Ansip's
Reform Party and its remaining coalition partner (Isamaa and
Respublica Liit - IRL) are expected to open negotiations to
replace SDE with the People's Union, an opposition party with
six seats in the parliament. (Note: IRL and Reform together
control 50 of 101 seats in the parliament, leaving them one
vote shy of a majority. End Note.) While President Ilves
signed off on Ansip's request to fire the three SDE Cabinet
Ministers (Finance, Interior and Population),he issued a
public statement calling on Ansip to "seek a new political
mandate from the parliament." Ilves does not have the legal
authority to require Ansip to step down and Ansip has made
clear he does not intend to resign as Prime Minister.


2. (SBU) The split in the coalition has been coming for weeks
as coalition partners (Reform, SDE and IRL) engaged in
contentious negotiations over budgets cuts and implementation
of a new labor law (reftel A). The situation came to a head
May 15 when the Reform Party publicly announced it would open
consultations with other parties in order to get the support
it needs to push its negative budget through the parliament
(before summer recess starts on June 15). On the morning of
May 21, the government approved a package of cuts totaling
approximately 217 million EUR (3.4 billion eek) - just over
half the amount necessary to keep the GOE's budget deficit
small enough (3 percent) to stay on track for euro zone
accession in 2011. Immediately following the cabinet meeting,
citing an inability to bridge the remaining differences with
SDE, Ansip announced he would seek the President's approval to
eject the three SDE ministers from the government. (Note: the
current Ministers of Agriculture, Justice and Social Affairs
will oversee the portfolios of the dismissed ministers until
new ones can be appointed. End note.) In his public remarks,
Ansip castigated SDE for using "its membership in the
government as a platform to enhance SDE's public profile"
ahead of the upcoming European Parliament (June 7) and local
government (October 18) elections. He also committed to
continue the GOE's conservative fiscal policies.


3. (C) By dismissing the Social Democrats, Ansip has removed
the biggest impediment to reaching agreement on the rest of
the necessary budget cuts. It is very likely that Reform/IRL
will press ahead on the budget in parliament even as jockeying
to replace SDE continues. The leaders of the People's Union
are scheduled to meet on Monday to discuss Reform/IRL's offer
to open coalition negotiations. At the same time, the Greens,
which also hold 6 seats in the parliament, have also expressed
a willingness to support Reform/IRL's budget proposals.
(Note: Both Reform and the Center Party - Estonia's largest
opposition party - have rejected the possibility of going into
coalition together. A near-term reconciliation between Reform
and SDE is also unlikely. End Note.)


4. (C) COMMENT: Ansip's determination to stay in office and
replace SDE rather than dissolve the coalition bucks political
tradition in Estonia. It is clear, however, that Reform and
IRL are hoping to avoid dissolution of the government and
preserve some stability as Estonia attempts to keep its
Eurozone hopes alive. Post will continue to monitor this
situation and provide updates. END COMMENT.

DECKER