Translated material
Lenten year
The Moscow City Duma approved the 2009 budget
The Moscow City Duma yesterday approved the most modest budget since the 1998 default. Moreover, this forced frugality, apparently, was not easy for the drafters of Moscow’s main financial document. At least, as the head of the city’s finance department, Yuri Korostelev, noted with regret yesterday, Moscow is accustomed to pursuing an active investment and social policy. But even with the so-called “protected items” of expenses remaining unchanged (on salaries of public sector employees, provision of benefit recipients and pensioners) and in the social sphere, officials had to look for reserves for savings.The Moscow budget, which was initially drawn up even before the crisis, approached the third reading in a fairly sequestered form. In particular, according to Mr. Korostelev, “based on the actual understaffing of regular positions,” next year the cost of paying state employees and civil servants will be reduced by 5%. In addition, all city institutions “have been given instructions to limit the maximum savings in consumed utilities,” and therefore these expenses of budgetary organizations will be reduced by an average of 3%. “We, as planned, will increase the salaries of public sector employees three times a year, and will also increase city pensions to two subsistence levels and fulfill previously announced obligations for other additional payments of a social nature,” while the city’s chief financier repeated like a mantra.
According to calculations by the head of the budget and financial commission of the Moscow City Duma, Igor Antonov, on average, spending on social services compared to the first version of the budget will be reduced by 5.9%, to 525 billion rubles. Much more seriously, officials decided to save on the construction of social infrastructure. Thus, according to Mr. Antonov, the cost of construction of social housing will be reduced by 27 billion rubles. Of the 2.7 million square meters of residential space required for 2009, only 1.8 million square meters can be built at the expense of the city, says Marina Ogloblina, head of the Moscow Department of Economic Policy and Development. However, officials, as previously reported, will purchase the remaining areas for social housing from developers.
By 4.5 billion rubles. capital investments in the medical sector will be reduced, as a result of which the city will be missing seven new clinics. According to Ms. Ogloblina, due to the reduction in investment intentions of urban developers and the decrease in the volume of new housing, the capital will be able to temporarily abandon the construction of new kindergartens, schools and sports and recreation complexes (of the 50 planned, less than half will be built). Allocations for the development of housing and communal services (by 16% of previously planned expenses), transport infrastructure (by 16%), fuel and energy complex (30%) and road construction (22%) will also be reduced. In general, the so-called optimization of social spending, according to officials, will save about 50 billion rubles.
At the same time, the Moscow authorities are not yet going to review the additional burden on citizens in the form of an increase in utility tariffs planned from January 1 next year (by an average of 27%). Let us recall that Prime Minister Vladimir Putin announced a possible revision of the rate of tariff increases last week during a live broadcast with Russians, after which an active discussion of this painful topic for consumers began in the offices of the White House . But Moscow, it seems, is not going to participate in these discussions yet. “The declaration is not a document,” deputy Igor Antonov told Vremya Novostei. “When new tariff indexation parameters are introduced, then perhaps we will change it.” According to him, the issue will largely depend on the willingness of the federal authorities to subsidize the losses of the city’s resource supply organizations. Otherwise, Mr. Antonov says, for utilities and energy companies, who are already forced to cut their investment programs, “it will be a disaster.”
For its part, the Moscow government is ready to provide financial assistance, for example, to city electric grid companies. In particular, the draft budget provides for a contribution of just over 7 billion rubles. into the authorized capital of the Moscow United Energy Company.
In addition, a significant part of the funds will go to support business entities that are of decisive importance for preserving the production potential of the real sector of the city’s economy. According to Yuri Korostelev, the latest version of the budget provides, in particular, for the creation of a financial reserve in the amount of 30 billion rubles. to be able to “promptly provide anti-crisis support” to companies in the form of city subsidies or budget investments. Another 50 billion rubles. to “support the financial market and sectors of the economy” in 2009 will be “transferred” based on the results of the budget execution of the year ending. As Mr. Antonov explained to Vremya Novostey, this money will be distributed solely at the discretion of the Moscow government. “We will be able to control this process only with the help of the Accounts Chamber,” he admitted.
True, we didn’t have to wait long for the opinion of the city auditors. During the discussion of the budget, the chairman of the Moscow Chamber of Control and Accounts, Viktor Dvurechenskikh, noted the lack of a transparent mechanism for distributing funds from the so-called reserve fund. In addition, according to Mr. Dvurechenskikh, the budget in general is devoid of specifics. “It does not contain a complete picture of what the expenditure side of the treasury will ultimately look like; information on the specific volumes of budget allocations for each department, target items and types of expenses is not indicated,” he listed his complaints. Representatives of the PCB were also confused by the fact that “information on the volume of reductions in the city’s financial obligations regarding pensions, benefits, compensation and other social payments to the population is not fully reflected in the budget indicators.”
Officials immediately explained all the shortcomings by haste and the fact that “for the first time they had to adjust a document of this scale downward.”
Representatives of the opposition factions of the Communist Party of the Russian Federation and "Yabloko - United Democrats" were not convinced by the officials' excuses, and they unanimously called the 2009 budget "inadequate" to the current situation in the country. It is noteworthy that United Russia members who supported the presented draft document noted that city financiers could be more careful in distributing treasury funds. In particular, Mr. Antonov, in a conversation with journalists, complained about the “spoiling” of Moscow officials, who systematically pledged more funds than necessary, and are now forced to shuffle them. “Usually, during the consideration of the budget in the third reading, deputies argue over the distribution of additionally identified revenues, trying to use them most effectively,” he explained. - Now the task is complicated by the fact that we have to reduce budget allocations for specific purposes, for which preliminary positive decisions have already been made. And this is very painful."
However, the majority of United Russia representatives voted for the main financial document of 2009. But, according to the budget and financial commission of the Moscow City Duma, in any case, it will return to legislators in the first quarter of next year, when the situation in the financial markets and in the country’s economy will be clearer.
Now, in general, the document provides that the city treasury in 2009 will amount to 1.387 trillion rubles. (as a result of a projected reduction in revenues from the oil and gas sector by RUB 143.3 billion). And expenditure obligations, reduced after optimization by almost 202 billion rubles, will amount to 1.462 trillion rubles. Thus, the city budget deficit will be a record low - about 75 billion rubles.