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Natalya Akindinova, head of the Institute “The Center of Development” of the National Research University - Higher School of Economics
The effectiveness of budget expenditure is a household name.
Everybody knows that much expenditure is ineffective, excessive, and should be cut.
Moreover, it should be done in the context of the worsening economic situation
– the budget doesn't have huge sums, as it used to.
And the group of experts faced the dilemma.
They could choose the concept of the so-called “budget manoeuvre”,
i.e. assume that some spheres of budget expenditure are top-priority while others are not,
and some redistribution of resources is possible between them.
In fact it was suggested in the Strategy-2020 that the top-priorities are education, healthcare, and infrastructure,
while less important are defense, law-enforcement activity, subsidiaries to enterprises, and so on.
The second concept means searching for ways to save in all spheres.
Considering the result which we have, the second concept seems to win
because the suggested means of saving touched on almost all spheres.
And to a large extent the cuts will touch on the spheres which were thought to be top-priorities
by the authors of Strategy-2020.
So there are rather developed measures in education and healthcare;
they will reduce expenditure on social security, even though this sphere has suffered the least;
and of course the pension system.
The majority of measures suggested in the report are aimed at development of legislation,
improvement of order and transparency, searching for internal reserves, but it doesn’t say exactly which reserves.
In general the report has few moments on increasing expenditure, except for two investment projects
– construction of the Central Ring Road and the road between Moscow and Kazan –
there are certain sums allocated to these projects.
It becomes clear that cutting social expenditure is needed
to improve the situation in the budget and financing such projects.
Vladislav Onishchenko, first deputy head of the Analytical Center under the Russian government
The report is not a done deal.
It is one of positioning, but nobody says that the decisions which will be made will correspond to the suggested draft.
They partially correspond to the goal which the authors of the report had.
The authors tried to show certain opportunities and support or oppose them.
Two issues should be separated.
The issue of improvement of effectiveness of budget money is one problem.
The issue of lacking money for plans of the budget in 2014 is another problem.
We can try to solve them by the same means or by different means.
As for 2014, for example, we have no resources to finance the budget we want,
as we lack money - according to the forecasts for economic growth, we don't have so many tax-payments and other revenues.
Alright. So we should find an opportunity to finance expenditure which we cannot finance today or we should cut them.
One possible variant is an increase in loans.
It is a possible option.
The volume of state debt is not so big – a part of expenditure, for instance, investments could be financed using loans.
Why should they be financed using current revenues at the expense of social expenditure or any other current expenditure?
Investment is a thing which will be used by future generations;
and a part of them could be financed by revenues of future periods, i.e. by the debt service.
Secondly, the budget consists of a certain volume of current liabilities
which have already been adopted and of additional expenditures which departments ask for doing something.
For instance, they reconsider their plans, and it appears that for some reasons they lack money
– this is called additional financing.
One of the simplest ways which was usually implemented in the past and probably would be implemented in the future
is to state that there would be no extra expenditure in a situation of saving the economy.
It reduces tension from the budget in the next year and also is the simplest and most obvious measure.
It doesn’t cut any adopted social liabilities, investment liabilities, defense liabilities, and so on.
The question on improvement of effectiveness of current expenditure is another thing.
We can discuss why the authors of the report point at these directions.
I don’t exclude that it is a provocation for discussing issues which are not usually discussed.