Budget rules are ... The essence of the budget rule

In the course of the adoption by the government of items of expenditure and revenues for 2013 and the planning period 2014-2015, The so-called budget rules were actively discussed. It was a long-term program for the use of oil and gas revenues. The need for it is due to the high dependence on profit from resources.

The essence of the budget rule

The logic of the introduction of the program is that the amount of existing government obligations, expenditures, as well as long-term investment projects was to a lesser extent than in previous years, tied to the current cost of oil. Budgetary rules - this is actually a prior agreement on financial constraints, aimed at preserving funds when price fluctuations.

Relevance of the issue

In Russia, there are various fiscal budget rules. This, for example, the size of rates of certain types of taxes. They are asked for regions and municipalities. Also, there are limit values of public debt, a deficit of public funds and so on. New budget rules for oil pricing in 2012 caused a lot of discussion. The matter is that the state fund was in a strong and rather dangerous dependence on oil and gas income. The adoption of a new order is considered a landmark decision for Russia's financial system and, in general, for the economy. The budget rules are the way by which it was supposed to eliminate the annual uncertainty, which often led to erroneous conclusions on the size of the price of oil in the coming year. The need for the program is conditioned by the fact that the revenues of the federal financial fund are half dependent on the value of this raw material.

Specificity

For 2013, the strategic objectives and the planning period for the next two years were based on strategic objectives. They were formulated in the Presidential Decrees, the Concept of long-term socio-economic development of the country until 2020. In addition, the basis was the main provisions, fixed in the Budget Message of the Head of State. It was planned that in 2013-2015-. Tasks for socio-economic development will be addressed in the context of the priority of ensuring macroeconomic stability, sustainability and long-term balance of the financial system. It was supposed to reduce dependence on foreign economic conditions.

Basic goals

The main tasks that will be solved using the budget accounting rule are:

1. Strengthening macroeconomic stability and ensuring the sustainability of the financial system.
2. Development of a strategy for the period up to 2030.
3. Establishment of parameters in accordance with which the development of the pension system will be carried out.
4. Formation of conditions for providing the population with quality public services.
5. Planning and implementation of a new stage in the development of intergovernmental fiscal interactions.
6. Provision of conditions for the drafting and implementation of the Federal Budget Law for 2014-2016. In the program format.
7. Perfection of the apparatus of management of state obligations and assets of the Russian Federation.
8. Ensuring openness and transparency of the budget process.

General characteristics of the provisions

Strengthening of macroeconomic stability and financial stability legislatively fixed budgetary rules. This will allow:

• Reduce the dependence of the system on the volatility of the world energy market prices.
• Increase the accuracy of forecasting in the long run.
• Form the necessary volume of sovereign funds of the Russian Federation.

The adopted rules for the preparation of a budget application suggest that excessive oil and gas revenues be transferred to the reserve fund with an increase in the base cost of raw materials. The direction of the funds was proposed to be implemented until the normative index reached 7% of GDP. If the projected oil price is lower than the baseline, then the budget deficit, arising from a decrease in revenue, will be covered from the reserve fund. Once its volume reaches the normative level, it is envisaged to transfer additional revenues from the oil and gas industry to the National Welfare Fund. Part of these funds can be used to finance infrastructure and other priority programs that do not cause Russia's obligations.

Features of the implementation

The budgetary rules provide for a number of mandatory provisions. In particular:

1. The marginal costs of federal funds should not be greater than the amount of income at a base cost, than 1% of GDP.
2. The total value of planned expenditures for the forthcoming financial year can not be lower than the approved Federal Law for the corresponding financial period of the indicator. This does not take into account the conditionally accepted losses.
3. The total amount of planned expenditures in the first year of the forthcoming period, without conditionally approved expenses of 2.5% of it, can not be lower than approved for the corresponding period of the Federal Law.

Mechanism of action

If the average annual price for oil for the last 3 years, including the current one, has been established at a level that does not exceed the base price, when the budget is formed, the latter is calculated by the average annual price for the specified three-year period. The advantage of this scheme, among other things, is that protection against the likely pressure of the main indicator is formed (as during the Stabilization Fund). The balance of the Reserve Fund for the end of 2008 amounted to 9.8% of GDP, by the end of the next year - 4.7%, for 2010 - 1.7%. Expenses from it in 2009 amounted to about 3 trillion rubles. Throughout the life of the Reserve Fund, there were noticeable fluctuations in the percentage of GDP in the conditions of the last crisis. At the same time, a fairly long decline in the cost of oil was observed in comparison with the previous unstable years in the country.

Cancellation of the budget rule

A number of experts are in favor of refusing the adopted program. As an argument, it is suggested that with an increase in the budget deficit, funds in excess of this amount can be used to invest in the country's economy. According to the Ministry of Economic Development, the growth rate will be significantly strengthened with a jump in 2015 deficit from 1% to 1.5 GDP (by 400 billion rubles.). In 2014, the indicator without applying the rule could be 1.1% instead of the estimated 0.5%. The introduced economy regime negatively affects not only the investment development of the national economy, but also the emergence of the social sphere of the state. Some analysts believe that the transfer of natural resources into a financial expression (accumulation of funds as debt obligations of foreign countries in sovereign funds) is not optimal. The costs of developing its own infrastructure, investing in production assets (the formation of material reserves) form a different system of the national economy.

In times of crisis, several experts believe, an improved and diversified domestic economic system is more important than foreign debt obligations and may require much less resources to maintain.

Arguments in favor of the program

As one of the most important advantages of the budgetary rule is the provision of readiness for a prolonged drop in prices in the oil market. The program should allow to automatically adjust the financial policy for a period of decreasing or slowing the rise in the cost of raw materials. One of the main goals of its implementation is to ensure macroeconomic stability, and its revision may become a negative sign for investors. At the very beginning of the promulgation of the program, many decided that the internal regulations of the budgetary institution had been adopted. However, the program has nothing to do with them.