The annual volume of investments in the national project “Safe High-Quality Roads” decreased for the first time in three years

The growth of state investments in infrastructure facilities within the framework of the corresponding national project was replaced by a decrease in funding. In the second quarter, the annual volume of funds allocated for Safe Quality Roads for the first time in three years decreased by 4.1%, to 451.9 billion rubles. Contractors do not yet note the lack of funds, but experts see the risks of further cuts in costs.

The annual volume of investments in the national project “Safe Quality Roads” (BKD) in the second quarter was reduced by 4.1%, to 451.9 billion rubles, according to a study by Sherpa Group. According to analysts, the indicator is falling for the first time in the last three years, and usually increased. Even in the condition of budget cuts in 2020 and 2022, additional funds were sent to the BKD, Sherpa Group points out. The office of Deputy Prime Minister Marat Khusnullin, who oversees the national project, did not respond to Kommersant.

The BKD is designed for 2019–2030. Includes six projects, including “Regional and local road network”, “Development of the federal highway network”, “Motorways of the Ministry of Defense of the Russian Federation”, etc. This year, within the framework of the BCD, it is planned to repair and build about 18 thousand km of roads throughout the country, spoke at the beginning of July, Mr. Khusnullin.

According to Sherpa Group estimates, in relative terms for 2023, the volume of investments for the Public Transport Development project decreased the most — by 12.1%, to 40.7 billion rubles. In absolute terms, according to analysts, funding for the Development of the Federal Backbone Network project was cut the most — by 10.3 billion rubles, to 202.3 billion rubles. The budgets of the projects “General system measures for the development of the road sector” and “Roads of the Ministry of Defense of the Russian Federation” remained the same.

Director General of the National Association of Infrastructure Companies Maria Yarmalchuk says that now there is a delay in financing for many objects under construction under the state order. Mikhail Burmistrov, General Director of Infoline-Analytics, notes that the growth of investments in road infrastructure continues. But some projects, such as the restoration and construction of roads in the annexed regions, are outside the national projects, so funds for the BKD can be redistributed, he says.

At the end of 2022, the total revenue of all companies in the construction industry grew by 13.9% year-on-year, to RUB 11.69 trillion, which Sherpa Group explained mainly by an increase in investments in infrastructure construction. As a result, road builders managed to increase their revenue most noticeably — by 20–25% year-on-year (see Kommersant of February 16).

Hussein Pliyev, CEO of Smart Engineers Group of Companies, notes that the budget adjustment after the first half of the year indicates more accurate planning. As a rule, by this time the main volumes have been contracted, contractors have been identified, there are works performed and it is possible to better estimate the budget needed for the second half of the year, he points out. Sherpa Group CEO Alexandra Galaktionova believes that some of the additional funds that were added to the project at the end of November 2022 could have been withdrawn from the BKD. According to the expert, inflation this year in road construction is lower than a year earlier, so funding could be reduced without losing construction volumes.

After the reduction, the amount of planned expenses for the BKD in 2023 exceeds the 397.5 billion rubles originally allocated for the national project this year, but will be 7.9% less than the level of 2022, when 490.4 billion rubles were spent, Ms. Galaktionova calculated . In the first half of 2023, according to Sherpa Grpup, contractors received 40.5% of the funds planned for the year, or 183.1 billion rubles. In the first half of 2022, 134.2 billion rubles were spent on BCD.

Mikhail Blinkin, research director of the Institute for Transport Economics at the Higher School of Economics, says that reducing the planned annual amount of funds by 4% is not the worst option, given that many other budget items have been cut more seriously. But any reduction indicates a possible transfer of part of the work on the national project, which in turn could lead to an increase in the accident rate, he warns. Alexandra Galaktionova fears that in the third quarter the volume of investments in the BKD may be revised again. The Ministry of Transport only told Kommersant that the parameters for calculating the Federal Road Fund would be specified in accordance with the Budget Code.

Daria Andrianova