Last week, it was reported that more than €2 billion of the 2025 budget had not been used, which is a similar amount to the year before.

This means that €1 out of every €10 the government planned to spend or invest was not used.

Viola Mäemurd, head of the financial department at the Ministry of Finance, told ERR that the reality is more nuanced.

Of the €2 billion, about one-third, or €618 million, is revenue from the sale of carbon dioxide quotas.

"In the case of CO2, all quota sales revenue received is currently shown as unused budget from the previous year, even though the government decided last September which projects the money would be used for in the coming years," she said.

Another €874 million is external support, such as European Union funding, which the state has planned from the outset to spend over a longer period.

Of the money the Riigikogu had specifically allocated to be spent last year, preliminary data shows that €390 million remained unused. This is about a third less than the year before and is the smallest amount in the past six years.

"For example, the budget surplus was reduced because the budget for the transition to Estonian-language education was planned last autumn for the correct years, meaning the years when those costs actually arise. Since leftover funds have been a focus for two years, administrative areas have also worked to reduce them," Mäemurd said.

New methodology

To avoid further confusion, the Ministry of Finance is now planning to change the methodology used to calculate the leftover funds.

In the future, unused money will only be used to refer to funding intended to be spent in a specific year. Money that can be used at other times will be removed from this category.

Mäemurd said under the new method, the amount of money left unused in the state budget could decrease significantly.

"We are not planning for a completely zero leftover, but the goal would be for ministers to consciously manage the execution of their budgets and the leftover amounts and keep them as low as possible," she said.

The official said each minister now decides how the leftover €390 million should be spent. These decisions will be made by the end of May.

For example, a minister may decide that activities originally planned for last year will instead be completed this year.

If some of the money remains unspent, it will be returned to the state budget.

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