The objective of the administrative reform is the establishment of capable local governments that can develop every aspect of local life, so that people can live well.
- Previous mergers of local governments have demonstrated that better and more accessible services are provided with joined forces and the competitiveness of the region improves.
- Pursuant to law, a local government must guarantee compulsory basic services for its residence, but this cannot always be done if the present fragmented administrative arrangement continues.
- Only a capable local government can balance public authority and be an equal partner to the state and businesses.
Mergers of Local Authorities
Government of the Republic has encouraged and promoted the voluntary process of merging municipalities throughout recent decades to establish municipalities with greater territory and number of inhabitants, nevertheless it has not had significant influence to the local government system as a whole.
The Government of the Republic appointed to office in 2015 was the first one to agree upon implementing administrative-territorial reform of local authorities during 2017 elections. The purpose of administrative reform was to support the increase of the capacity of local governments in case of offering high quality public services, using regional prerequisites for development, increasing competitiveness, and ensuring a more consistent regional development.
Administrative Reform Act was passed in June 2016 to implement the reform and alter the administrative-territorial organization of cities and rural municipalities.
According to the law local authorities must be able to independently organize and manage local life and perform functions arising from law. Administrative Reform Act stipulated that in order for local authorities to be able to ensure professional capability necessary for organizing functions arising from law and provide quality public services to all the residents of a local government in accordance with the purpose of administrative reform all local governments must have at least 5,000 residents (criterion for the minimum size of a local government).
Local governments which did not meet the criterion for the minimum size of a local government had to submit a proposal for the alteration of administrative-territorial organization for the deadline set in law (1.01.2018). Law granted the Government of the Republic with the right to initiate the alteration of administrative-territorial organization of those local governments that did not meet the criterion or failed to submit the proposal on their own (15.02. 2017 at the latest).
Financial motivation for voluntary amalgamations were increased for the reform: voluntary amalgamation grant was doubled to 100€ per inhabitant (with the minimum amount of 300 000€ and maximum amount of 800 000€ per municipality involved in a merger). Additional grant of 500 000€ was established for fulfilling the recommended criteria of 11 000 inhabitants 500 000 €.
Additionally, compensation for former mayor and council chairman was doubled (one-year salary) and guarantee set in law for not decreasing state grants for the next 8 years due to amalgamations (i.e. if the size of the grant allocated from the state budget in the year following the year of the merger is smaller than it would have been individually, the decrease in the grant caused by the merger would be compensated for the period of 8 years).
Before the Administrative Reform Act was passed mergers of local authorities were regulated by the Territory of Estonia Administrative Division Act and Promotion of Local Government Merger Act.
There were state organized merger consultants who provided support for the local authorities involved in the merger process.
Main arguments for supporting municipal mergers is that they enable:
- to formalize administratively the long-term cooperation already in place;
- coordinated development the whole region;
- better ability to apply for European Union project support for major development and in investment projects in the entire region for a balanced and coordinated development;
- offer residents better services and hire more employees and officials with higher competence;
- increase the administrative capacity of the local authority, which will ensure the specialization of the officials and the rise in the quality of public services;
- to improve and intensify the public transport traffic, etc.
Additional Information
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Collection of articles: Administrative reform 2017 in Estonia (see below) (PDF)
- Administrative Reform Act
- Territory of Estonia Administrative Division Act
- Promotion of Local Government Merger Act
- Overview of local government mergers in Estonia before (1996-2014) and during the reform (2017) (21.43 KB, DOCX)
- Administrative reform blog (in Estonian)Collection of articles: Administrative reform 2017 in Estonia
Results of Local Government reform
As a result of the local government administrative-territorial reform (LG ATR) the number of municipalities decreased from 213 to 79.
Additional information (in Estonian)
- FAQ about the ATR (PDF)
- Manual for the preparation of amalgamation process (PDF)
- Recommendations for the name selection of amalgamated municipality by the Place Names Board (PDF)
- Analysis of the financial implications of local government mergers (PDF), extras of the analysis (PDF) and presentation (PPTX)
- Analysis of the territorial-administration reform carried out in Latvia and of its implications (2011) (PDF)
Collection of articles: Administrative reform 2017 in Estonia
The aim of the collection is to provide a comprehensive overview of the central choices and processes of administrative reform. It can serve as the basis for further analysis of the results and impact of the administrative reform and it could be used as a learning resource for planning and implementing complex reforms in the future, even outside of Estonia.
The articles are analytical accounts of the main features of the recent reform process, written by experts familiar with the implementation of the administrative reform.
- Full collection of articles: Administrative reform 2017 in Estonia (PDF)
- The Design of the Process of the Administrative Reform – Ave Viks (3.19 MB, PDF)
- The Main Political Attitudes and Arguments Prior to the Administrative Reform: Why was it successful this time? – Argo Ideon (101.97 KB, PDF)
- The Attitudes of the General Public toward the Administrative Reform 2013–2016 – Hella Kaldaru (74.54 KB, PDF)
- The Principles and Legislative Choices Underlying the Administrative Reform – Olivia Taluste (2.74 MB, PDF)
- In What Way Should the Preparations for the 2017 Administrative Reform Have Been Different and Why? – Sulev Mäeltsemees (109.97 KB, PDF)
- The Central Criteria for the Administrative Reform: Why stipulate 5,000 and 11,000 residents? – Veiko Sepp, Rivo Noorkõiv (216.06 KB, PDF)
- The Merger Negotiations Initiated by Municipal Councils – Mihkel Laan, Kersten Kattai, Rivo Noorkõiv, Georg Sootla (PDF)
- The Execution of Government-Initiated Mergers – Kaie Küngas (2.67 MB, PDF)
- The Background Factors and Trends of the Administrative Reform – Rivo Noorkõiv (2.48 MB, PDF)
- The Development and Dilemmas of Estonian Local Government from a European Perspective – Georg Sootla (367.82 KB, PDF)
- Plans for the Administrative-Territorial Restructuring of Estonia from 1989 to 2005 – Madis Kaldmäe (1.13 MB, PDF)
- To What Extent Did the Administrative Reform Take into Account Long-Term Changes in Settlement Structure and the Global Competitiveness of Localities? – Garri Raagmaa (5.99 MB, PDF)
- The Merger Contracts Signed During the 2017 Administrative Reform – Mikk Lõhmus (1.86 MB, PDF)
- Fifty-One Shades of Public Engagement – Sulev Valner (1.47 MB, PDF)
- The Changes Made to Place Names in the Course of the Administrative Reform – Peeter Päll (389.92 KB, PDF)
- The Transfer of Villages from One Municipality to Another – Rivo Noorkõiv, Mikk Lõhmus, Kersten Kattai (2.43 MB, PDF)
- The Protection of the Constitutional Guarantees for Local Government during the Administrative-Territorial Reform – Vallo Olle, Liina Lust-Vedder (4.71 MB, PDF)
- If You Dislike a Court Judgment, No Explanation Will Do – Priit Pikamäe (1.08 MB, PDF)
- The Light and Dark of Administrative Reform at the County Level – Neeme Suur (3.25 MB, PDF)
- The New Territorial Pattern in Estonia – Veiko Sepp (439.62 KB, PDF)
- The Need to Reform the Estonian Local Government System from an Outside Perspective – Jüri Võigemast (129.34 KB, PDF)
- Administrative Reform as Part of State Reform – Külli Taro (147.68 KB, PDF)
- Lessons from the 2017 Administrative Reform – Airi Mikli (122.63 KB, PDF)
- What Was Achieved with the Administrative Reform and What Remains to Be Done? – Arto Aas, Mihhail Korb, Jaak Aab (3.4 MB, PDF)
- A Timeline of the Key Events of the Administrative Reform 2015–2017 (65.22 KB, PDF)
New legal opportunities for inter-municipal co-operation
During the reform legislation regarding the municipal co-operation and associations of local government was amended.
Regulation of joint agencies and joint administrative agencies was established in Local Government Organisation Act in order to allow local governments to cooperate in implementing tasks with public authority (e.g. supervision, managing joint school service area (administration and service provision compared to joint-school (service provision) which was already legally possible to establish). Joint administrative agency or joint agency is formed for the performance of joint functions based on a contract under public law. The latter also stipulates the regulation joint agency is governed by (generally the regulation of a local authority of its location).
Regulation of regional associations of local authorities was established in addition to the county associations of local authorities existing currently. The latter was amended and a possibility to form a joint association for two or more counties was added.
Some new joint tasks were also assigned also local governments from county governments by law. These included:
- planning the development of the county (i.e. composing county development plans as a part of the state strategic planning);
- organizing regional public transport (via jointly established public transport centers);
- coordination of regional health promotion, security councils and cultural cooperation.
Local authorities may decide the form of the co-operation for these tasks (except for the public transport), assigning it either to a (1) county or regional association of local authorities, (2) to one of the local authorities on the basis of a co-operation agreement or (3) to another co-operation body of local authorities (joint agency).