Press Release, 30.05.2017

The government’s amendments to the state budget introduced past week to the State Duma for the first time lacked the data on total expenditures for defence or security. Thus it will be even more difficult to monitor where the secret expenditure are allotted to. Yabloko believes that the structure of the current budget and the number of the concealed items of expenditure indicate the desire of the federal government to guarantee its own irremovability, as well as the possible allocation of resources in favour of a large businesses close to it.

Photo by Artyom Korotayev/TASS

According to RBC, for the first time since 2008, the package of documents on the state budget submitted to the parliament contained no information on the total expenditure of the budget on the sections and subsections of the functional classification (“National Issues”, “National DefenCe”, “National Security and Law Enforcement Activities”, “National Economy “, etc. – 14 sections in total, each of the sections envisaging up to 13 directions). Total expenditure means open plus closed (secret) allocations. Consequently, the parliament and society may lose the tool allowing to at least somehow detail the secret budget expenditures. The Ministry of Finance did not see such a problem and explained the change, which it considered insignificant, by the government’s greater focus on the “programme-targeted approach”.

RBC further explains how the budget information is structured and provides the data on what part of the budget is closed: “The structure of the Russian budget is provided in three ways: functional (as of sections and subsections), programme-oriented (as of programme and non-programme measures) and departmental (as of principal administrators of the budgetary funds). The Ministry of Finance has been presenting only an open part of the expenditures in all three parameters for a long time, but a special annex to the explanatory note provided an opportunity to see the full structure of the expenditure (together with the closed part), at least in the context of sections and subsections.

Yabloko believes that the amendments initiated by the government deprive citizens of the least opportunity to learn how the state spends the funds of the state Treasury.

“Recently, the federal budget has reached the maximum secrecy in the entire post-Soviet history,” Grigory Yavlinsky, Chairman of the Federal Political Committee of Yabloko, noted. “The share of closed expenditures in the budget has been growing continuously since 2009, having increased by more than 2.5 times since then. As early as 2015, the share of secret expenditures was 20 per cent (in the US budget, for example, it is only about 10 per cent). In our conditions, this means that no one can properly control anything and it is impossible to assess the effectiveness of the secret expenditures.”

“The budget process is non-transparent and closed to public discussion, and the budget itself is built on arbitrarily chosen priorities,” runs the YABLOKO Bureau statement criticising the federal budget for 2017 even before new amendments were made. “72 per cent of defense spending, 6 per cent of expenditures on national issues, 8 per cent of expenditures on the national economy, and 34 per cent of law enforcement costs were made secret.”

“The trend is there,” said economist Sergei Ivanenko, Deputy Chairman of Yabloko. “All this means the restoration of the Soviet system, under which the government disposed of the financial resources without any control. Even the limited control that the society have had over the implementation of the budget, not to mention its drafting, is actually curtailed. This is done when the budget is mainly aimed at self-preservation of the power. Therefore, huge expenditures go to the military and the police. It is interesting to note, that these amendments “make secret” not only the defense industry and the security, but also such items of expenditure as the “National Economy”. It can be assumed that there are some large amounts of money spent on projects of oligarchic structures”.

However, despite considerable resistance of the executive power, Yabloko still manages to achieve local victories, consistently upholding the transparency of the budget process. In particular, in April 2017, the party managed to get the Legislative Assembly of St. Petersburg approve the draft law on the city budget by Grigory Yavlinsky. Its provisions make the budget of St. Petersburg, both at the stage of its formation and at the stage of its development, considerably substantially more open and transparent.