Minister: The Defense Ministry will take temporary control of EDF assets

The Ministry of Defense will follow the National Audit Office's recommendation to temporarily transfer management of the Estonian Defense Forces' assets to the Ministry of Defense, Minister Hanno Pevkur said.
A year has passed since the previous audit. The National Audit Office says work has been done, but there have been no results. Why is that?
The National Audit Office also says there have been results. If we compare the comments made by the National Audit Office last year with those made this year, I'll give you one example: the Estonian Center for Defense Investments received 36 comments. Of those, 32 have now been addressed and corrected, leaving four. Some of them may not even be possible to correct because they concern older contracts that are already in place.
We have hired a separate team to conduct inventories, we have amended our internal accounting rules and we have now ordered a full inventory. All the steps we have taken over the past year and which are now set out in the action plan should provide the National Audit Office with the assurance it is looking for that everything is also in order from an accounting standpoint. We know that, in substance, everything is in order.
You said Friday that taxpayers' money has, in any case, gone to the right place. But if we read the National Audit Office's criticism, doesn't it essentially mean that if there is as much confusion over inventories as the National Audit Office describes, we don't know whether what was paid for actually exists?
We know what we have paid for and what we are supposed to have in our possession. To put it very simply, we know exactly how many howitzers we have, how many shells we have; we know what is in our warehouses. The issue is more that the value of assets changes over time and when it comes to accounting for all assets and inventories, the Estonian Defense Forces is an enormously large organization. I acknowledge that, despite its size, the Defense Forces must have its affairs in order.
The National Audit Office's recommendation that this function be temporarily transferred to the Ministry of Defense is the right one and I certainly agree with it. We will bring it into the Ministry of Defense, put things in order ourselves and then hand it back to the Defense Forces.
What does that mean in practice? How long will things remain this way?
We have also looked at the experience of other ministries. For example, the Ministry of Education and Research took over all financial management from HARNO, the Education and Youth Board, put things in order and then handed it back. As a rule, it takes six months to a year. We hope we can put the functions we are taking over from the Defense Forces in order just as quickly and then hand them back. The Defense Forces must ultimately be responsible for ensuring that the shells are there and that all of them are properly accounted for.
The heads of the defense agencies have indicated that they do not intend to resign and the Ministry of Defense's permanent secretary has said the same. Do you see yourself as bearing any responsibility for this situation?
You know, I am responsible for Estonia's national defense every day, together with the entire team. But of course, we are looking into these matters. Ultimately, when it comes to taking inventory of these stocks and assets, there is a specific person somewhere who has failed to do a particular job, so of course we will look into that as well. We will examine it through internal audit and internal controls and our job is to assure the Estonian people that everything Estonia needs to defend the country is there.
Does that mean you will remain in office as defense minister regardless?
As long as I have the confidence of the prime minister and parliament. That's always how it is in politics: If parliament decides that you are no longer fit for the position, then you have to step down.
In its audit of the state's consolidated annual report, the National Audit Office found numerous serious problems in the activities of agencies under the Ministry of Defense's area of government, which it said increase the risk of misuse of state funds and assets. For example, the audit found that defense-related inventories have been incorrectly recorded.
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Editor: Marcus Turovski, Marko Tooming











