Tension in Estonia's Coalition

Res Publica is resisting the demands by the People's Union for higher direct subsidies to farmers in the 2004 budget and has discussed the possibility of forming a new coalition with the Pro Patria Union replacing the People's Union, LETA reported on 15 August, citing the daily "Eesti Paevaleht." Under such a scenario, the new coalition would have 54 instead of the current 60 deputies in the 101-member parliament. Agriculture Minister Tiit Tammsaar of the People's Union is adamantly requesting that an additional 200 million kroons ($14.5 million) be given to farmers so that their subsidies would represent 55 percent of those in the EU. Tammsaar is insisting on the higher subsidies, which were mentioned in the coalition agreement, because future EU subsidies depend on the level of subsidies paid in Estonia. The budget that the Finance Ministry proposed would provide only 40 percent of the EU subsidies.