E-state sitting on ticking bomb

Development and maintenance of state information systems takes €135 million from this year’s state budget. That makes up 1.31 percent of the budget – much less than we spend on national defense.

We also spend less on our IT-state than the Finns, whose corresponding spending makes up 1.41 percent of the budget, not to mention Denmark where it is 2.4 percent. The Ministry of Internal Affairs has the biggest IT budget – €32 million – followed by the defense ministry on €15 million and social ministry on €12 million.

Some registers not touched

The stark realization started manifesting this winter, when all ministries communicated their IT budget needs for the next four years. It turned out that current funding falls some €240 million short of what would be needed.

That is the sum the Estonian e-state is missing. The annual IT budget for the next four years is currently that same €135 million. Ministries need an additional €60 million a year for critical updates to systems that should have been replaced years ago.

Deputy Secretary General of the Ministry of Economic Affairs and Communications (MKM) Siim Sikkut said that information systems and ICT infrastructure have been underfinanced for years, including critical IT systems supporting public services.

“Estonia has had and still has structure funds money to procure new equipment and develop new systems; however, things that have already been built and developed need constant maintenance and updating to ensure reliability and that we keep with the times,” Sikkut explained.

Secretary General of the Ministry of Internal Affairs Lauri Lugna said that analyses show that 44 percent of software at the core of internal security IT systems has become completely outdated and is working far beyond its intended lifespan. The weapons register has been unchanged for 15 years, and no one dares touch its source code – something might give.

“We have basic needs that are not being met; we are literally living on a ticking timebomb,” Lugna said. His meaning is that all state information systems are linked in a vital network and a single block falling out of place could bring down the entire tower.

The secretary general said that the effects go beyond that and also concern business. “Should Estonia’s e-story bust or develop holes at one point, it will be more difficult for our companies to market themselves in the world, and our e-success story might turn into an e-disaster,” Lugna said.

Siim Sikkut added that MKM and the finance ministry have gone over ICT strategies and applications of all administrative areas and concluded that it is vital to boost the state’s IT budget by around €30 million a year for a total of €113 million over four years.

Ministries put the missing funding at €60 million a year. “We must consider places where we can save money and our capacity for making use of it – such a leap would not be feasible all at once. An extra €30 million a year can ensure the survival and development of the e-state,” Sikkut ventured.

The Ministry of Justice that manages, among other things, the business register and courts’ IT systems asked for an extra €8.9 million for 2019-2022 but was only given €3.4 million by MKM.

“Upkeep of existing systems requires more and more resources. There is that much less left over for new developments. While these few developments also add to the cost of maintaining systems in the long run,” said the ministry’s press representative Kristin Rammus.

European subsidies to fall

She also said that the tendency of concentrating on hardware and software in ICT developments while human resources are left without attention is troubling.

Estonia must also keep in mind that major IT developments will be funded using EU means over the next four years. After that, developments should be included in the base budget.

That would require another estimated €20 million euros starting in 2023.

“Estonia has two major stories: the story of its pristine nature and its e-story. I’m genuinely afraid that if we do not invest in the latter, it might implode on us,” Lauri Lugna said.

The finance ministry refused to comment on the e-state’s need for funding – the budget strategy is not a matter of public record before decisions are made, we were told. The cabinet is expected to discuss the matter in coming weeks. The question is of nothing less than the sustainability of Estonia’s IT-state. Today, missing sums are nearly half of existing ones.