Estonian Defence Minister Hanno Pevkur announced his resignation on 2 September, taking political responsibility for a series of problems in the defence sector, including unreliable military inventory records, a criminal investigation and failed ammunition contracts linked to support for Ukraine.
The political crisis followed a National Audit Office report published in late August. It found that auditors could not verify the existence and quantity of military inventories worth around €1.2 billion. The finding did not mean that equipment worth €1.2 billion was missing, but that the ministry’s records were too unreliable to provide a clear picture of its stocks.
The audit followed criticism from the previous year. On 1 September, prosecutors confirmed that they had opened a criminal investigation into the accuracy of inventory balances reported in the Defence Ministry’s 2024 accounts. The investigation followed a report by opposition Centre Party MP Aleksandr Tshaplogin. No suspects had been named.
At the same time, problems emerged over ammunition contracts intended to support Ukraine. The Estonian Centre for Defence Investments (RKIK) signed several contracts with Datasel S.R.L., an Italian-registered company linked to an Indian business family. Around €60 million was paid in advance, but the promised ammunition was never delivered and the dispute went to court.
Eesti Ekspress reported that Datasel had no previous experience selling artillery shells when the contracts were signed. RKIK Director-General Elmar Vaher said he believed the contracts should not have been signed. The newspaper also reported that Pevkur and other senior officials had been informed about risks associated with the supplier. RKIK later identified problems with two other suppliers involving around €10 million and began preparing material for possible legal action.
Pevkur said advance payments were normal in the arms industry and that delays in defence contracts were common. However, criticism of the defence ministry intensified, and coalition ministers from Estonia 200 backed his resignation. Pevkur, who had served as defence minister since 2022, acknowledged that his departure came only months before Estonia’s March 2027 parliamentary election.
Prime Minister Kristen Michal said the Reform Party would discuss candidates for a new defence minister during the following week, with the successor expected to take the oath the week after. The government also ordered a review of Ukraine-related contracts and their risks by 10 September and an updated plan to address military accounting problems by 1 October.
Estonian media said the next minister would face the task of restoring trust in the defence sector while maintaining international representation and support for Ukraine. Editorials also highlighted the difficulty of finding a suitable replacement so close to the parliamentary election.
The resignation is likely to increase pressure on the Defence Ministry to improve its internal controls and accounting. The government’s reviews and the deadlines of 10 September and 1 October will provide the next key tests of how Estonia responds to the problems exposed in the defence sector.
