Government's priority: "extra" budget money will be given to the security officials, not the doctors

Victoria Pavlova

Previously, the federal budget was in a state of deficit, and fulfilled its obligations, including financing of health care and social support, only thanks to the growth of the national debt. Now it's the other way around. The Ministry of Finance collected 11.264 trillion rubles in 6 months. This is 2.1 trillion rubles, or 23% more than in the first half of 2020. Financiers can be proud of such indicators, because they even exceed the value of the pre-crisis 2019 by 18%. Naftogaz brings in about 600 billion rubles a month, VAT charges increased by 27% - thanks to constantly growing prices for goods. Excise and income taxes added 18% (for some large companies, for example, metallurgists and fertilizer producers, profits are growing by leaps and bounds), customs duties on imports increased by 70% - import substitution did not fundamentally change the situation.

Officials and security officials - everything, doctors and socially unprotected - all that is left

But, raking in money with a shovel, the Ministry of Finance is in no hurry to spend it. Expenditures increased by only 6% compared to last year - to 10.638 trillion rubles. Builders are happy: the implementation of large infrastructure projects has increased spending on the "national economy" by 1.5 times - up to 1.507 trillion rubles. Officials and civil servants are happy: the courts received an additional 5.4 billion rubles, tax officials, customs officers and regulatory authorities - 7 billion rubles, the Foreign Ministry received an increase of 41 billion rubles, and the CEC - 6.5 billion rubles. The siloviki rejoice - they added 45 billion rubles to national security and law enforcement agencies (1.005 trillion rubles were allocated to the Ministry of Internal Affairs, Rosgvardia, FSB, FSIN).

But doctors, unfortunately, have no reason to be happy. Health care funding was cut by 81 billion rubles, or 13%, to 573 billion rubles. This is despite the fact that Russia at the beginning of this week came in second in the world in the number of deaths from covid, overtaking Brazil and even India. Only Indonesia is ahead. Saving on medicine in such conditions is at least strange.

Social support also remained aloof from cash flows. For six months, 3,046 trillion rubles were spent on it, which is 4.8% less than last year. Moreover, the dynamics of social spending is negative. In June, the government allocated 9% less money for these purposes than in May, and 26% less than in June 2020. And although the Ministry of Finance is observing a "rosy trajectory" of economic growth, wages are not really increasing (the Ministry of Economic Development predicts the slowest growth of wages in 20 years in the next 4 years, not counting the 2014 crisis), and real disposable incomes of the population are falling altogether. The regions also remained without money: transfers decreased by 31% to 490.9 billion rubles. But the responsibility of these regions to the population has not diminished - the incidence of coronavirus is growing everywhere.

Reasons for the stinginess of the Ministry of Finance

FBK's partner, director of the Institute for Strategic Analysis, Igor Nikolaev, associates the government's greed with the fact that the desire to save money for the Ministry of Finance is a familiar and inevitable phenomenon.

- Traditionally, contrary to the plans of the Ministry of Finance, money is not selected at first, but at the end of the year it is actively spent. This year is no exception - it has been, is, and there is no reason to say that it will not be so. The Ministry of Finance can be asked for additional funds at any time so that it can find them, so it is pursuing an appropriate policy. The department understands that it is necessary to have some reserves in conditions when uncertainty about the pandemic persists, and not only persists, but since June it has sharply deteriorated and the likelihood that there will be lockdowns is growing.

And independent analyst Dmitry Milin explains where the Ministry of Finance got the extra funds from, and why the department set the focus in the distribution of income in this way, giving preference to officials, rather than doctors and the public.

- Our officials, and the government is the "vanguard" of the Russian bureaucracy, consider every ruble in the pocket of a Russian citizen or on the account of a Russian enterprise as a personal insult. Therefore, the government, with the help of the "pocket Duma", constantly increases taxes and levies. Since it is not customary in our country to ask for a report from the government and other authorities, no increase in tax revenues not only does not lead to an increase in social spending, but also does not lead to the implementation of any loudly announced projects. If you remember, the implementation of the National Projects, for which we increased the VAT by 11%, was postponed from 2024 to 2030, removing all intermediate quantitative stages in the hope that no one will remember them by 2030. The report on the implementation of national projects is conducted not according to the results achieved, but according to the amount of funds “used” by officials.

From the point of view of accounting, there is a colossal difference between social expenditure items and national mega-installations with material support for security officials: some have less money, while others have more. But Dmitry Milin adheres to the point of view that the result will ultimately be one - close to zero.

- Budget money disappears in tens of trillions. For example, according to the previous ambitious program of rearmament of the army GPV-2016/2020, the RF Armed Forces did not supply either 2,300 Armata tanks, 38 S-500 air defense systems, or 5th generation Su-57 aircraft. The only serial (which is already an anecdote) Su-57 was delivered without a standard "second stage" engine, which, in fact, should provide the characteristics of that very "fifth generation". And the money for this ambitious program (about 40 trillion rubles in total) has already been spent.

Igor Nikolaev draws attention to the fact that the government, apparently, is in anticipation of an even more catastrophic state of affairs.

- It cannot be said that we do not have social assistance to people at all in connection with the pandemic, but the fact that we here differ for the worse from developed countries is a fact. If we take social support directly, then it is of a point nature in our country - first of all, families with children are supported. It seems to be a win-win option. But in fact, it turns out that our support is really less than in other countries. The indicator of the dynamics of real disposable incomes of the population indicates that in 2020 they decreased by 3% in our country, and, accordingly, in the OECD countries, they increased by 2.7%. That is, during the crisis, incomes increased, while in our country they decreased. They were greedy. Why do they do this - because they want to save more money for a rainy day. True, the question is - if this is not a rainy day, then what is considered a black day?

One thing is clear - the Ministry of Finance cannot save in principle, because, as it turned out, Anton Siluanov has no way out: the probability is too high that at any moment the country's leadership will demand to find additional funds for something unplanned. But the distribution of available money according to expenditure items perfectly demonstrates the attitude towards people who, in the conditions of turbulence on the commodity markets, have become "new oil" for the government. Just business and nothing personal.