Heiki Loot, Government of Estonia: Exclusive Interview

By on 21/04/2015
Heiki Loot, State Secretary, Estonia

Heiki Loot is one of Estonia’s longest-serving state secretaries, having served 12 years in the post. He tells Global Government Forum about the changes he has overseen during his time in office and his plans for the future

On March 1, the people of Estonia took to the polls. But it took almost a month for a new government to be formed. The relatively long negotiation period was due to a “complicated election result,” Heiki Loot, state secretary to the Estonian government and head of its civil service, explains. “The Reform Party came out as clear winner but in order to have a sufficient majority in parliament it was necessary to form a three-party coalition, instead of two which was the case under the previous administration. That created a need to combine election programmes of three parties – the liberal Reform Party, the Social Democratic Party and the conservative Pro Patria and Res Publica Union. This was not an easy task – everybody had their sometimes costly promises and red lines.”

Loot, however, is no beginner to this. In his 12 years as state secretary, he has been part of the formation of five governments. Having served three prime ministers, Loot is the longest serving state secretary – otherwise known as cabinet secretary – in almost 25 years. Even though state secretaries have traditionally been appointed for indefinite terms, Loot explains, his predecessors typically stayed in post no longer than four years.

What is his secret? “The most important thing is trust,” he says. “You have to do your best advising the prime minister so that your political masters see that you can be trusted. You have to realise that you are serving the government, you are not a political master yourself: you have to respect the decisions which have been made.” He adds that getting along on a personal level is important too: “When the chemistry between the prime minister and state secretary does not match, there is no reason to stay in office – it’s important that there is a connection and that the co-operation is smooth.”

So when did Loot begin to learn how to be a smooth government operator? He started working for the Estonian government some 20 years ago. It was an exciting time to join: in 1991, Estonia regained its independence after 47 years of Soviet occupation. And in 1992, a new constitution came into force. New thinkers had to be brought into the civil service – people who could help shape the state, looking to the West for inspiration rather than East.

Loot was one of these people. Fresh out of law school, he was taken on by the newly established Supreme Court where he became assistant to the chief justice in 1994. Just a year later, he was promoted to lead the Department of Public Law in the Ministry of Justice. At the young age of 24, he was asked by his minister to largely replace his team of 10 staff because “most of them were not fit for purpose”, he says. “The minister told me: ‘Here’s the department, here are the legal reforms we need to do, it’s up to you how you find suitable people – just go ahead’.”

Out with the old, in with the new

The reforms his team was about to embark on involved public and criminal law, as well as civil service law. “When you start doing new legislation,” he says, “you have to be able to read comparative information from other countries, so you need foreign languages.” Most of his team lacked language skills, which is why Loot replaced them.

“I had to invest a lot of time and energy finding the right people,” he says, adding that most of the new recruits were students still at university. This, he says “was the only chance to get a new perspective into the team, they were very keen to study, to look at the Western experience and to adjust it to our constitution.” Those team members who remained – “some of the older generation”, ran the day-to-day business, while the new reforms, Loot says, were given to the new arrivals.

Loot’s approach was no exception. During the first years of Estonia’s regained independence, about 10,000 “old-minded” civil servants were exchanged for “new-minded” officials, representing a third of the entire workforce. At the senior levels, Loot says, “most were changed.”

After five years of leading the Estonian Public Service Academy – a university of applied sciences responsible for the training of civil servants run and financed by the government – Loot was first appointed state secretary of the Republic of Estonia in August 2003.

Appointing top civil servants

As state secretary Loot oversees the Government Office, which includes nine separate units aimed at supporting the prime minister and executing the government’s core business. The Government Office is also home to the Top Civil Service Selection Committee – the independent body overseeing senior civil service appointments. The committee, which is chaired by Loot and also includes private sector experts, is responsible for organising and running open competitions for all top civil service posts, with some exceptions. It screens candidates and suggests shortlisted applicants to the relevant minister for final appointment.

While the committee’s recommendations are not binding, Estonia’s civil service law includes a rule aimed to “make it difficult for a minister to go against the committee’s opinion”, Loot says. If ministers do decide against the committee’s applicants, they “cannot just put their own candidates forward,” Loot says. They have to decide on the basis of the committee’s proposals. Permanent secretaries, on the other hand, are appointed by the Cabinet, on ministers’ recommendations, but these candidates are also screened by the committee.

Loot argues that these processes ensure civil servants’ impartiality and neutrality – qualities particularly important to maintain because Estonia’s small population offers only a small pool of “qualified people”.

Estonia’s digital revolution

Estonia now is one of the most internet-dependent countries in the world: Estonians vote, and pay tax, online; their health records are online and, their ID cards offer them access to a wide range of public services. Schoolchildren as young as seven are taught how to programme computers, and the government holds digital cabinet meetings with citizens able to comment on government policies on the Internet.

But Estonia has not always been such a digital economy: “I remember when I started at the Ministry of Justice in 1995, I received my first salaries in cash,” Loot says. “Previously, all banks were state-owned and people would only use them if they had savings. But most people didn’t have a lot of savings. So doing financial transactions with the help of banks was largely unknown to Estonians.”

The creation of a banking system was a “big transformation” for Estonian society and brought about a lot of other change too. As people became used to electronic banking, they quickly accepted digital ways of conducting other business such as signing official documents.

So how did it all come about? Estonia’s digital revolution happened in the late 1990s. After regaining independence and reforming most of its institutions, government leaders asked: “What’s next for Estonia?”, Loot says. “Of course, we were striving for NATO and EU membership, but the question was: ‘What will be the next big thing we are going to change in our society?’ The answer was IT.” In 1996, Toomas Hendrik Ilves, then ambassador of Estonia to the USA and later president of Estonia, proposed a project to heavily invest in the development and expansion of computer and network infrastructure in Estonia, called Tiger Leap.

Tiger Leap was the first building block on the road to a digital society, Loot explains. Key to enabling the digital delivery of public services, Loot says, was the creation of many decentralised IT systems, rather than “one mega system”. Each department developed its own IT system specific to its needs, but, thanks to a technical infrastructure called X-Road, all the separate systems and databases could “speak with each other.”

To protect citizens’ privacy, Estonia has put in place a number of safeguards: “First of all, you give consent to your data being processed,” Loot says. “Another measure is that every citizen can always check who in government has accessed his/her data and for what purpose.” There have been cases of public officials abusing their access to personal data, Loot admits. “Some police officers have been removed from office because they checked some information for their personal use or because their relatives asked them to.” Every time a government employee accesses data, it is publicly recorded with “the exact time and purpose,” he says, enabling authorities to detect abuse.

Reforming the civil service

Loot has also overseen some significant reforms to the Estonian civil service over the last 10 years: in 2005, the first competency framework for senior civil servants was adopted and this has since been used as the basis for selecting and developing senior civil servants. Previously, the development of top civil servants was in the hands of individual public-sector organisations.

Another priority which grew in urgency was to better join up government departments. This discussion was bolstered by the OECD Public Governance Review of Estonia, commissioned by the Estonian government and published in 2011, which concluded that the country needed structural as well as cultural changes to overcome its fragmented set-up. Estonia, the report said, “cannot ignore this issue, and will need to take an integrated and innovative perspective when developing solutions.” It said that, “due to its small size, Estonia cannot afford to be fragmented” and called on the government to “identify ways to build greater cross-sectoral collaboration, and better integrate strategic and budgetary planning.”

Getting departments to work together is not easy, says Loot. Estonia has been run by coalition governments since it regained independence in 1991. This, Loot explains, has meant that different departments have been governed by politicians from different political parties, which has “strengthened the culture of rivalry between departments – including among civil servants.” To combat this culture and achieve a whole-government approach, Loot says, “we had to build a joint senior civil service starting with the permanent secretaries.”

Heiki Loot, state secretary, Estonia (left) and Peter Ong head of civil service, Singapore (right), in discussion at the Global Government Summit, November 2015.

Heiki Loot, state secretary, Estonia (left) and Peter Ong head of civil service, Singapore (right), in discussion at the Global Government Summit, November 2015.

Creating a team spirit

To foster a team spirit, Loot started a new tradition in 2006. Since then, he has been taking all permanent secretaries on trips once or twice a year sometimes to meet with their counterparts in other countries. So, having a “joint pool of senior civil servants, as well as the team spirit among permanent secretaries, is the only basis on which you can build a successful co-operation and coordination model,” Loot says.

Another suggestion the OECD made was for the Estonian government to introduce a small number of strategic goals, summarising all of the government’s objectives. This was useful advice, Loot explains, as “with coalition agreements, every party wants to see as many of its own priorities and promises in the coalition agreement as possible, so you end up with hundreds of objectives which need to be accomplished or implemented during the government’s mandate.”

The responsibility for formulating these goals, Loot says, falls to the senior civil service: “It is our duty to translate the coalition programme into strategic goals and, during that process find the instruments to implement them,” Loot says. Estonia, he adds, has three strategic goals: reducing child poverty; reducing taxes on labour; and continuing to spend 2% of GDP on national defence.

Reorganising the centre of government

Amidst the number of reforms Loot has driven forward, his biggest achievement is the reorganisation of the Government Office: in order for the office to be able to “do the strategic planning work as well as the government policy coordination,” he says, “we had to reshape the model of the Government Office”, which had been responsible for too many areas.

The Government Office had been, he explains, “responsible for the National Archives, for example”. Responsibilities for the civil service were scattered across departments: “The Government Office was responsible for the development of the civil service as a whole; while the Ministry of Finance overlooked civil service pay; the Ministry of Justice did the legislation of the civil service; and the Ministry of Social Affairs led on civil service pensions; “So we decided to give away the so-called side functions to departments, for example, responsibility for the National Archives was given to the Ministry of Education and Research.” Other functions, such as any civil service-related policies were moved to the Ministry of Finance. This helped us to focus on and to bring to the next level of quality, the core business of the center of government: that is planning, coordinating and communicating government policies.”

Five-year terms

Another significant change Loot has led affected the length of senior civil service appointments. While previously most appointments were made on a permanent basis, Loot oversaw a reform which in 2013 introduced five-year terms. “In order to implement innovation, your top people need to be open to change,” he says. “And when you have a culture where people remain within one sector or one department for a long time, they get used to a very specific way of working. So we thought the only way to give people the impulse to see and implement new ideas and to be innovative was to make them rotate.” At the end of their five-year-terms, senior civil servants have to re-apply for their post but are encouraged to apply for a different position altogether.

Loot beyond 2018

The new law also applies to Loot and his term will come to an end in 2018. Will he re-apply for his post? “No, enough is enough!”, he says. “Doing the same job for so long can become boring.” he says jokingly, but later adds: “We need to be serious about the rotation and mobilisation of people so we all need to move around.”

Loot wants to stay in the civil service though, and 2018 will certainly not be a boring year for Estonia: from January to June 2018, Estonia will hold the EU presidency. “For a small country like us of 1.3m, it’s going to be a challenge to run the EU Presidency. It means that our civil service has to prepare itself. It means that we will have to perform all the same functions which big states are performing: we will have to chair some 200 working groups within the EU on topics we may not know very well. And our ministers will have to be in good shape; they have to be qualified in foreign languages, EU politics and policy to chair successful meetings.”

The other big event in Estonia in 2018 will be the centennial of the state. “So, not only will we have to do tough work running the EU presidency, but at the same time, we’ll have to celebrate!”

About Winnie Agbonlahor

Winnie is news editor of Global Government Forum. She previously reported for Civil Service World - the trade magazine for senior UK government officials. Originally from Germany, Winnie first came to the UK in 2006 to study a BA in Journalism & Russian at the University of Sheffield. She is bilingual in English and German, and, after spending an academic year abroad in Russia and reporting for the Moscow Times, Winnie also speaks Russian fluently.

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