TALLINN, 6 November 2003 - The SAO audited the activities of the Ministry of Education and Research in compensating the students for travel expenses and found that the funds allocated from the state budget for benefits were used to cover other expenditure as well. Also, the practical arrangements of compensating for expenses varied from school to school because of the different interpretations of legislative provisions.

According to the Public Transport Act, students engaged in daytime study and university students engaged in full-time study received a compensation from the state budget for up to 100 % of the price of the public transport ticket until the autumn semester of this year. The audit revealed, however, that the practical arrangements of paying these benefits and verifying the student’s entitlement to the concession varied from school to school.

In the opinion of the SAO the unlike treatment of the students of different schools is very much a result of the ambiguity of the Government Regulation governing the compensation for travel expenses. The SAO made several proposals to the Ministry concerning the clarification of the said Regulation. In his response, the Minister of Education and Research informed that the Ministry supports the proposal of the SAO to amend the Regulation governing compensation for travel expenses in order to set identical requirements to target groups and provide for the uniform interpretation and application of the Regulation. Also, it should be possible to recover the benefit in cases where false information has been knowingly submitted.

Furthermore, the audit revealed that financial planning is not transparent. The guidelines for planning in the budget the amount necessary for compensating for travel expenses are unclear. Public upper secondary schools, boarding schools for the disabled and sanatorium schools with a boarding facility as well as vocational schools receive funding on the basis of applications and lists of students. However, it is not clear whether the school should, for budgeting purposes, take account of all the possible trips or make provision for the possibility that the students do not make all the possible trips. As a result, some schools have unused budget funds, but some have a deficit.

The SAO addressed the Parliamentary Finance Committee, pointing out that the Ministry of Education and Research has violated the State Budget Act. In the preceding year 45 million kroons were allocated for the implementation of the system of study allowances and half of this amount was charged to a reserve. Since the Study Allowances and the Study Loans Act did not enter into force on the planned date, the supplementary budget provided for using the reserve for scholarships and as compensation for travel expenses.

However, less than 8 million kroons of the 22.6 millions in the reserve were used for this purpose. The rest of the funds were used for the following major categories of expenditure: payment of allowances to students studying abroad, formal education of teachers within the adult education system, development of educational field of study in Estonian institutions of higher education, increasing the mobility of teachers and students, and other projects. Some of the said amount was used to cover the operating costs of the Archimedes Foundation and the Accountancy Office of the Ministry.

In doing so, the Ministry has ignored the requirement of the State Budget Act according to which the Minister may not alter the purpose of expenditure set out in the State Budget Act. The funds were allocated for the payment of study allowances and the aforesaid expenditure, especially the financing of the operating costs of a foundation and the supplementary financing of the Ministry’s Accountancy Office, cannot be considered as the use for intended purposes of the funds earmarked in the state budget for the payment of scholarships and study allowances.

The SAO communicated the audit report to the Parliament and it is expecting the Parliamentary Finance Committee to take a position on this issue.


Sven Soiver
Press Representative of State Audit Office
Telephone: (372) 640 0787
GSM: (372) 53 414464
E-mail: [email protected]

• Posted: 11/6/2003 12:00 AM
• Last Update: 10/2/2015 3:54 PM
• Last Review: 10/2/2015 3:54 PM