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Budget Committee advises Duma to adopt 2012-2014 budget in 2nd reading

More than 270 amendments were considered when preparing the document for the second reading

MOSCOW, November 17 (Itar-Tass) —— The State Duma Budget and Tax Committee has recommended the lower house of parliament to pass the 2012-2014 budget in the second reading.

The draft budget is scheduled to be debated in the second reading on November 18 and in the third reading on November 22.

More than 270 amendments were considered when preparing the document for the second reading.

Budget revenues in 2012 are projected at 11.78 trillion roubles, budget expenditures at 12.66 trillion roubles, budget deficit at 0.88 trillion roubles.

In 2013, budget revenues will be set at 12.71 trillion roubles, expenditures at 13.73 trillion roubles, deficit at 1.02 trillion roubles.

In 2014, budget revenues are expected to be 14.09 trillion roubles, expenditures 14.58 trillion roubles, and deficit 0.49 trillion roubles.

The government plans to have a deficit-free budget in 2015.

All calculation are based on the assumption that the Urals blend in 2012 will cost 100 U.S. dollars per barrel, GDP will be 58.683 trillion roubles and inflation 6 percent.

These indicators are projected to be 97 U.S. dollars per barrel, 64.803 trillion roubles and 5.5 percent respectively in 2013, and 101 U.S. dollars per barrel, 72.493 trillion roubles and 5 percent respectively in 2014.

The ceiling for the state internal debt has been set at 6.33 trillion roubles as of January 1, 2013; 7.87 trillion roubles as of January 1, 2014; and 9.22 trillion roubles as of January 1, 2015.

The ceiling for the state foreign debt has been set at 48.4 billion U.S. dollars or 34.6 billion euros as of January 1, 2013; 59.4 billion U.S. dollars or 42.4 billion euros as of January 1, 2014; and 69 billion U.S. dollars or 49.3 billion euros as of January 1, 2015.

In the current year, the Russian budget may have a surplus of 0.1-0.2 percent of GDP this year, the Finance Ministry said.

“At any rate, we expect no deficit,” Deputy Finance Minister Tatyana Nesterenko said.

She did not provide any data regarding budget implementation in the first ten months of the year, but noted that there was a surplus as well.

Earlier, President Dmitry Medvedev signed amendments to the federal budget for 2011 and the projected period of 2012-2013.

The amendments were drafted taking into account the results of the budget implementation in January-August 2011 and also on the basis of updated forecasts of socio-economic development of Russia and the expected results of budget implementation in 2011.

The amendments approve the key parameters of the budget for the current fiscal year, which increase the projected GDP, federal budget revenues and expenditures, lower the ceiling for the state internal and foreign debts, and envisage a deficit-free budget.

The amendments also increase budget appropriations for the fulfilment of public regulatory obligations in 2011, redistribute budget appropriations within the approved amount of expenditures, and specify contributions to the authorised capital of open joint stock companies.

At the same time, Russia will not avoid a budget deficit if oil prices continue to fall, the Finance Ministry said in a medium-term forecast presented by acting Finance Minister Anton Siluanov earlier.

The draft budget for 2012 is based on the average annual oil price of 100 U.S. dollars per barrel and GDP of 58.683 trillion roubles.

Indicators for 2013 are 97 U.S. dollars per barrel and 64.803 trillion roubles. The projected oil price for 2014 is 101 U.S. dollars per barrel, and GDP is 72.493 trillion roubles.

If the average annual price falls to 90 U.S. dollars per barrel, the budget deficit in Russia will be 2.5 percent of GDP, and about 5.4 percent of GDP is the oil price is 60 U.S. dollars per barrel.

“In this case we will not be able to direct money to the Reserve Fund and will have to use it,” the acting finance minister said, adding that this would make it hard to balance the budget.