In recent days, people have begun asking how much of the European Union's next budget period funding will reach rural areas and small towns, how places farther from centers will be supported, and what will happen to the EU support program LEADER. Members of parliament, municipal leaders and local action groups are asking this.

The answer is written in the Ministry of Finance's latest allocation table. Its authors have made a series of decisions that are political in substance. They have chosen which sectors will receive more money and which will lose. They have reduced LEADER and local services funding, left out the regional financial instrument, and placed LEADER under agricultural funding.

Each such choice determines in which part of Estonia investments can be made, services developed and local decisions taken.

The Ministry of Finance has said in advance that ministries may change proposals within the total amount assigned to them. Therefore, the Ministry of Regional Affairs and Agriculture may add money to LEADER, local services and regional entrepreneurship at the expense of another area under its responsibility.

In practice, I am directed to look for missing regional policy money from the same allocation of the Ministry of Regional Affairs and Agriculture (REM), which includes the 546 million euros intended for agriculture and food security. The allocation prepared by the Ministry of Finance forces the regional minister to choose between farmers' investments and local entrepreneurship, services and communities. The government has not yet confirmed this choice.

The allocation is called indicative. The government can change it on 8 September. If the government confirms the allocation, the same figures will be taken to the European Commission. Based on them, measures for the next seven years will be drawn up.

Cohesion policy is, according to its legal purpose, created to reduce regional development disparities. Article 174 of the Treaty on the Functioning of the European Union requires special attention to rural areas and areas with permanent demographic or natural disadvantages. According to the European Commission, most cohesion policy funding is concentrated in less developed countries and regions to help them catch up and reduce economic, social and territorial differences.

Estonia's working version does not ensure this goal. Measures of other ministries are counted as regional policy, even though their regional distribution, purpose and outcome have not yet been agreed. At the same time, funding for measures whose target and impact are already known is being reduced.

In the current funding period, 395.2 million euros from the responsibility of the Ministry of Regional Affairs and Agriculture has been directed to entrepreneurship, municipalities and communities. In addition, 82 million euros of CO₂ quota revenue and modernization fund resources and 48 million euros of financial instruments have been used for local government investments.

The structure of the new period is different, so not all amounts can be compared one‑to‑one. The direction of the allocation becomes clear measure by measure.

In the Ministry of Finance's proposal, REM's regional measures together with LEADER amount to 203.6 million euros. The 65 million euros for regional industrial and business areas has been moved under the Ministry of Economic Affairs and Communications. This money is not lost. Together with it, the volume of known regionally targeted measures reaches 268.6 million euros.

My proposal is 460 million euros: 125 million euros for regional entrepreneurship, 150 million euros for municipal services and crisis resilience, 140 million euros for LEADER, 20 million euros for public transport and 25 million euros for the development of the border region.

The difference between the Ministry of Finance's and my proposal is 191.4 million euros. In the Ministry of Finance's current allocation, this part of the regional package has no coverage. Of this, 96.4 million euros is missing from LEADER and local development funding, 45 million euros from municipal services and crisis resilience, and 50 million euros from the regional financial instrument.

The harshest decision concerns LEADER. In the first working version, 25 million euros was left for LEADER. After REM's opposition, the amount was raised to 43.6 million. In the current period, the volume of community development is 139.1 million euros. Even the improved proposal leaves LEADER with less than one third of its previous funding.

According to the Ministry of Finance's own material, the CAP earmarked allocation is already filled in full in the first stage. Therefore, the 43.6 million euros for LEADER is not an 85‑percent co‑financing share to which the rest will automatically be added later. There is no binding decision for any additional amount.

Over seven years, 43.6 million euros makes an average of 6.2 million euros per year for all of Estonia. The money is divided among 26 action areas. According to LEADER implementation data, as of August there were 1691 projects. The median support amount was 14,003 euros. Its impact comes from many local decisions, not from a few large objects.

Aegviidu Rescue Association received 34,493 euros to build a safe access to the station building and secure slopes. Pärnu‑Jaagupi Firefighting Association received 39,995 euros for purchasing a tank container that can carry both extinguishing water and drinking water needed for civil protection. The transformation of Kohila's old municipal building into an open community center received 99,309 euros.

These are rescue capacity, local service and entrepreneurship. A minister's office cannot know whether the slope at Aegviidu rescue station needs securing or whether Pärnu‑Jaagupi volunteer rescuers need a tank container — people on the ground know.

The core of LEADER is the right to local decision‑making. People in the region agree among themselves which investment changes their home area the most. The state provides the framework and monitors the use of money, but does not dictate from Tallinn what each village needs.

Cutting two thirds of LEADER funding reduces, along with the number of projects, local people's ability to influence the future of their region. This is currently called a compromise.

Even worse is placing LEADER under the common agricultural policy funding. According to the rule set by the Ministry of Finance, every euro added to LEADER must be found within REM's assigned total amount.

The prime minister has confirmed that 546 million euros will remain for agriculture and the food sector. I support this promise. Estonian agriculture needs this money to improve competitiveness, productivity, crisis readiness and food security. I will not take money from farmers to save LEADER. Nor do I agree with cutting LEADER on the grounds that money must be preserved for agriculture.

Contrasting agriculture with the rest of rural life is cynical. Agricultural enterprise needs workers, roads, electricity, rescue capacity and local services. People will not stay in rural areas if schools, transport, care services and the ability to participate in local development disappear alongside work.

LEADER must be brought back under the "Multicentric Estonia" priority and funded from cohesion policy resources. My proposal is 140 million euros, which would preserve the current volume and not take money from farmers.

The next difference concerns municipalities. In the Ministry of Finance's proposal, 75 million euros is allocated for developing local services and 30 million euros for crisis resilience. My proposal is 150 million euros in total.

The missing 45 million euros would allow reorganizing an entire municipality's or county's service network, developing joint services and making the investments needed for change. The goal is not to preserve every building — the service must remain available to people even when the population decreases and the current arrangement no longer works. Closing a service is cheap, but creating a new arrangement costs money. If the state funds cuts but not new solutions, retreat is called reform.

For entrepreneurship, I propose a 125‑million‑euro package. It includes ten million euros for regional entrepreneurship measures, 65 million euros for developing industrial and business areas, and 50 million euros for a regional financial instrument.

The 65 million euros for industrial areas remains in the Ministry of Finance's proposal and is under the responsibility of the Ministry of Economic Affairs and Communications. The location of the money does not free the ministry from the obligation to achieve a regional result. The measure must retain a binding regional target and measurable regional outcomes. REM must participate in shaping it.

Missing is the 50‑million‑euro financial instrument. Investments often remain undone farther from centers because real estate collateral value is lower and necessary capital cannot be obtained from banks. A company may be strong and the investment profitable, but the location worsens financing conditions. Regional policy must offset this difference.

The Ministry of Finance's table says that the remaining ten‑percent target level for rural areas will be met by measures of other ministries: water reform, housing, sustainable mobility, historic city centers and business support.

Some of this money will reach outside Tallinn, but that is not enough to call the measure regional policy. It has not yet been agreed how much must reach different regions, which obstacle will be removed there, and what will be done if money concentrates in larger centers.

In the allocation table, a political choice has already been made — the potential regional impact of other ministries' measures has been counted as funding in advance, while LEADER and municipal funding have been concretely reduced.

Other ministries' measures must also be assigned regional goals, principles for distributing money and measurable outcomes. If the agreed impact does not occur, the conditions of the measure must be changed.

The government should decide on the state plan's funding allocation on 8 September. After that, negotiations with the European Commission and the shaping of measures will begin. I will take my 460‑million‑euro proposal to the government on 8 September. In its current form, I cannot support the regional part of the state plan.

The Ministry of Finance has made its proposal. If the government leaves the allocation unchanged, the 43.6 million euros for LEADER will become a government decision instead of an officials' working version, and then every member of the government must be ready to justify this amount to local action groups.

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