Painted – to believe – Newspaper Kommersant No. 180 (7381) of 09/29/2022

The budget for 2023–2025 was submitted to the State Duma without changes related to partial mobilization. With a high probability, the White House will no longer adjust either its articles or the budget forecast approved before September 21. The margin of safety in the budget for 2022-2023 is still very large, and the nature of the changes that developments may require before the end of this year is still impossible to predict – the White House’s freedom of action in adjusting the current budget for at least next year remains virtually the same as this year and more than in 2020-21.

The budget for 2023-2025 with all the documents of the budget package was submitted to the State Duma on September 28, a few days before the October 1 deadline. Recall that the basic parameters of the budget structure were approved by the government after several meetings in the Kremlin and the White House, which took place before September 21, although, obviously, there was an opportunity for the government to receive an additional delay in the adoption of the budget in connection with the announced partial mobilization. From the published bills, it is not obvious that they have already included the costs of financing these activities, which, however, can be scheduled (as, according to information not officially confirmed by Kommersant, this was done with spending on four territories of Ukraine allegedly annexed to the Russian Federation) in closed articles. At the same time, according to Kommersant, the government, at least now, does not plan to come up with initiatives to change the budget in October-November during its discussion in the State Duma.

In any case, the budget forecast for 2023-2025 was included in the budget package unchanged, despite the events of the last week and their consequences will inevitably change, perhaps even in its basic assumptions.

It’s not just about the costs of mobilization itself – the Ministry of Economy and the Ministry of Finance somehow have to take into account its impact on business and investment activity, unemployment rates (mobilization of at least 0.3% of the workforce will inevitably change them), incomes and savings moods of households, consumption levels and likely inflationary expectations.

At the same time, it is apparently simply impossible to change the forecast “on the fly” – the technology for drawing up the federal budget in the Russian Federation assumes the primacy of the forecast for determining revenues, expenses and other basic budget parameters, and until November 2022, apparently, the scale (and sometimes signs) of new it is impossible to assess external shocks with any accuracy, not to mention the prices of raw materials exports, new sanctions, the possibilities of the payment system, and last but not least, the reaction of the Russian economy to the work of the state in a mode similar to the military one, and the volume of requests from the Ministry of Defense and departments to move on these rails.

De facto, a purely political decision was made – the budget is adopted in the form in which it was planned for the beginning of September 2022, and now it is of secondary importance compared to the operational decisions of the authorities. Moreover, it was in 2022 that the powers of the White House became even wider than the opportunities received during the COVID-19 pandemic to change budget expenditures without changing the budget law (in agreement with the State Duma Budget Commission, this procedure will continue in 2023, for which, apparently, there will be a peak of change). In 2022, we note that the budget is extremely stable: as Finance Minister Anton Siluanov explained at a briefing on September 28, the department will need to borrow from the National Wealth Fund (NWF) to cover the deficit only in December 2022 (despite the fact that the budget is in deficit since September, and the plan for spending the NWF in 2023 is 3.2 trillion rubles).

In rather tense circumstances, the budgetary freedom of the White House has so far been reliably backed by financial reserves.

Thus, the budget “package” without changes integrates the principle according to which the government prefers an increase in domestic loans to spending the NWF, while the volume of its use (2 trillion rubles in 2023, 0.6 trillion rubles in 2024, in 2025 by As a result of budget consolidation, in the worst case, 1.64 trillion rubles will remain in the fund – with a literal, unchanged execution of the federal budget and with constant oil export prices below $62 per barrel) will decrease if the Ministry of Finance is able to borrow more than the plan in the domestic market. Thus, in 2023, the volume of domestic loans can be additionally increased by 1 trillion rubles. with the corresponding savings of the NWF. The fund, according to Anton Siluanov, can, under some combination of circumstances, be spent (including directed on state investment projects) and replenished at the same time. In addition to this freedom, the White House will operate its reserve fund and the remnants of past years that come into it. Tightening budgetary discipline in 2022, the minister confirmed, could increase this reserve by approximately 0.5 trillion rubles, for example, at the expense of uncontracted government spending.

Finally, the rigid construction of the budget – from 2025, as a result of the application of budget rules (they are defined in the budget package extremely simply – these are annual basic oil and gas revenues in the nominal amount of 8 trillion rubles, increased by target inflation, 4% annually) tougher – gives the White House a very large operational freedom: now the revenue figures in the federal budget, even taking into account withdrawal of “surplus profits” of exporters do not look too high, although not so low: for example, the budgeted average gas export price is about $700 per 1,000 cubic meters. m. Nevertheless, after September 2022, it is impossible to answer the question of whether it is a lot or a little.

Thus, the basic hidden hypothesis for the budget is clearly the assumption that a new scale of reduction in private demand in the Russian economy will absorb most of the pro-inflationary effects from the growth of government spending, and a relative drop in energy prices in the world due to problems in the EU economy (a decline in industrial production due to for high gas prices), China (the worst GDP dynamics in 2022 for many years) and the whole world (super high inflation) will provide the Russian budget with a stable ruble exchange rate. So far, these are assumptions based on the experience of the past months and years. As the practice of 2022 shows, now, including in the budget, it is worth considering the possibility of events that previously seemed absolutely fantastic.

Dmitry Butrin