Estonian audit again finds problems in defence sector, but no officials plan to resign

The National Audit Office's summary audit published on 28 August largely confirms findings from previous years. Already in July 2024, the office had written to then-Defence Ministry Chancellor Kusti Salm, stressing the need to streamline work processes at the Estonian Centre for Defence Investments (RKIK) and the Defence Forces, and noting a significant volume of assets that had not been inventoried. The review found errors in procurement documentation, prepayments and inventory records.

Last year's audit already flagged similar issues, noting that organisational shortcomings at RKIK and the Defence Forces affect accounting for assets, expenses and claims, as well as budget execution. These unresolved, longstanding problems are compounded by risks from the sharp rise in defence funding, some of which have already materialised. For instance, since 2018 one supplier's account had held a prepayment of €9.6 million, effectively an interest-free long-term loan funded by Estonian taxpayers, since RKIK kept ordering goods from the same supplier for years without offsetting new orders against the prepayment.

This year's audit also notes that the Defence Ministry took on commitments not foreseen in the state budget — the state may need to pay an additional €70 million that was not budgeted. Chancellor Kaimo Kuusk said the potential cost stems from a legal dispute with a supplier that failed to meet its obligations, and it remains unclear whether the risk will materialise. Former defence minister Urmas Reinsalu accused the ministry of having promised not to let such situations recur. Kuusk responded that the issue would be fixed and that the explanatory note should have described this hypothetical risk.

No one takes responsibility

Defence Minister Hanno Pevkur did not respond to ERR's calls. Kuusk confirmed that the chancellor is responsible for the ministry's financial side but said he sees no grounds to resign himself, noting that the action plan drawn up last year has since become more specific, with responsible persons and deadlines assigned.

RKIK head Elmar Vaher acknowledged that some documents had been signed by people lacking proper authority, but denied any goods or money were missing, calling it a documentation issue. Colonel Valdo Veski, head of logistics at the Defence Forces General Staff, noted this year's audit found no problems with Defence Forces property records, though an exception that allowed equipment to go unvalued expired at the end of 2025, creating a €1.2 billion accounting gap. He does not expect major changes as a result of the Audit Office's recommendations.