Friday, September 19, 2014

Ulyukayev: Budget can not be called balanced – Russian Newspaper

Ulyukayev: Budget can not be called balanced – Russian Newspaper

On Friday, September 19 in Sochi started the business program of the 13th International and investment forum “Sochi-2014″. Began the first working day of the forum with the Savings Bank business breakfast on “Balancing the budget or the acceleration of growth: time to choose?”. Discussed herein maintaining macroeconomic stability as a necessary condition for economic growth.

So, the potential growth in Russia is estimated by most experts in the low two to three percent, and the current slowdown is even more severe. In such a situation, according to experts, questions about how to stimulate the economy come to the fore. But whatever the promotion, it will be costly for the consolidated budget. For many years the sustainability of public finances, low public debt, as well as the accumulation of sovereign funds were considered one of the main focuses of the economic policy.

For example, the Minister of Economic Development of the Russian Federation Alexei Ulyukayev believes that the federal budget can not be considered balanced when the costs on the economy, education, health and culture is three times less than the cost of defense, security and transfers to the Pension Fund.

– This is an absolute imbalance. Imbalance between the development objectives of the country, the nation, the individual and their resource provision. And this condition is deteriorating more and more, – said Ulyukayev, speaking at a business breakfast. – The problem is not that we have much or little cost, and that these costs are not high quality – it is non-productive costs.

Finance Minister Anton Siluanov, for his part, said he sees the potential for raising efficiency and cost optimization in the articles on social support and national defense.

– Need a hard audit costs. Reserves we have, they are in a block Olga Golodets. We have repeatedly talked about the need for a more targeted approach to social spending – said Siluanov. – Huge transfers to the Pension Fund, the pension system should be cut, it is our source for the infrastructure. Defense spending also so difficult to maneuver in the budget that they eventually have to optimize and reduce the share.

The two ministers said that correctly pose the question of choice – a balanced budget or acceleration of growth: “When budget surplus before the crisis, 2008 to 2009 had the highest rates of economic growth. budget in this case is just one of the elements of domestic demand, fiscal policy tool “.

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And the Russian Finance Minister Anton Siluanov believes that only the optimization of budgetary expenditures in the current environment does not solve the problem of slower economic growth in the country, should be carried out and structural reforms.

But the former Russian Finance Minister Alexei Kudrin said that the poor quality of public administration – the main obstacle for the growth of the Russian economy.

– The quality of governance – I would not say that the worst, but it does not match the goals of economic growth – said Kudrin. – A more coherent system of governance can provide from 1.5 to 2 percent growth in the economy – not in the first year, but within a few years, this potential would be realized.

At the moment, in his opinion, public administration system is the weakest link in the economy. Another reason for the stagnation – an inefficient structure of the budget.

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– We have for the next year budget revenues fall to 0.5 percent of GDP, and the costs – grow by 0.5 percent GDP. Thus, we have 1.5 percent of GDP increase imbalances, – he said.

So, according to Kudrin, budget spending will increase next year by 1.5 trillion rubles – more than was spent on training and the Olympic Games in Sochi. But in this case, the bulk of the funds will go to defense and social spending. That is, he believes, for the next three years because of the decision worsening conditions for economic rosta.Takzhe Kudrin recalled the proposals to ease monetary policy of the Central Bank to stimulate economic growth. Such a measure would, in his opinion, the economy may instead damage.

– The interest rate can not be lower than inflation, because all the assets of banks in the country will become unprofitable, will decrease. It would be against economic growth – said the former minister.

After completing a business luncheon organizers will begin preparations for the meeting Prime Minister Dmitry Medvedev. It is expected that in the media center Medvedev arrives to 11.00. Visiting a forum for the premiere will begin with a tour of the exhibition halls. And already at 12.00 starts plenary session with his participation.

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