Demand is growing, while government purchases are shrinking – Kommersant

Despite the government’s plans to increase spending on public procurement at the beginning of the year, there is no extreme growth in budget spending on government orders, according to Kontur.Torgov (after processing EIS data in the field of procurement). The amount of published trades in the first quarter in annual terms increased by 10% – from 3.04 trillion to 3.35 trillion rubles, while the volume of concluded contracts has been declining for the last three years. In 2021, their volume was estimated at 3.32 trillion rubles, in 2022 – at 2.91 trillion rubles, in 2023 – at 2.46 trillion rubles. (see graph). Earlier, we recall, the Ministry of Finance explained the record budget deficit at the beginning of the year by a sharp increase in public procurement spending, including from 249 billion in January 2022 to 1.305 trillion rubles. in January 2023 (by 1057%), due to the prompt conclusion and advance of contracts. At the end of the quarter, however, the growth of budget spending on procurement slowed down – they amounted to 2.47 trillion rubles. against 1.06 trillion rubles. in 2022

It should be noted that the procurement data of Kontur.Torg differ from the available data of the Ministry of Finance for previous years – this may partly be explained by the complication of calculations due to the introduction of flexible budgeting mechanisms, including advance payments for government contracts, as well as the redistribution of funds between the years of the budget three-year period and individual managers to speed up the construction of facilities ahead of schedule. However, flexible budgeting and an increase in the flow of state funds to the economy were more likely to ensure an increase in the volume of contracting, while a decrease in the indicator could rather be a sign of a shortage of goods after the departure of foreign suppliers and the imposition of sanctions – as a result, expanded state demand remains unsatisfied.

In quantitative terms, the state managed to conclude more contracts – 960.8 thousand against 826.6 thousand in the first quarter of 2022, but their average price fell from 3.5 million to 2.56 million rubles. Analysts of Kontur.Torgov explain this decline by the desire of suppliers to obtain contracts in any way, including dumping. In 2022, Kommersant noted an increase in supplier competition for market purchases due to the expansion of the practice of non-competitive purchases from a single supplier. However, according to Kontur.Torgov, purchases from single suppliers were also reduced – from 1.3 million to 0.8 million rubles, which is most likely due to a decrease in the supply of more expensive imports and the concentration of customers on “affordable” purchases.

Diana Galieva