OREANDA-NEWS. October 01, 2014. Minister of Economic Affairs and Infrastructure Urve Palo said some people have launched a psychological war as the result of the government's effort to procure a new domestic ferry operator for the next 10 years.

Speaking on ETV's “Kahekone” program on Thursday, Palo said one company, Vainamere Liinid, has run the domestic ferry service for the past two decades. Although the service has been good, there have been investments made into new ferries, and the operation runs smoothly, she said.

The only problem is the cost to taxpayers, and the state must create competition to save on subsidies, she said.

“Looking at how the private sector has sent out public letters it is definitely a psychological war to influence me. But I will ignore it. I have participated in many serious negotiations. And I can assure you that telling the media where the aim is is not a tactic of talks,” Palo said.

Palo's ministry recently declared a tender to find a new domestic ferry operator a failure, having only attracted one bid, and that bid was from the current service provider. The ministry has now begun direct talks with the current company and state-owned Port of Tallinn.

Vainamere Liinid criticized the tender, saying there is little chance of building four new ferries by the fall of 2016, when the new contract enters force. The tender required new ferries.

Palo's predecessor, Juhan Parts, has criticized the new government's approach, saying the current subsidies are too high and the state should own the ferries. Parts has suggested renting each ship on a route to different companies, thus creating competition.