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New budget rule to be introduced in 2018 — presidential aide

The new budget rule is aimed at reducing the dependence of Russia’s budget on market revenues

MOSCOW, April 17. /TASS/. The new budget rule (mechanism of Russia’s budget formation, determines the maximum level of spending on the basis of oil prices - TASS) may be introduced starting 2018, Presidential aide Andrei Belousov said Monday.

"I think it may, but virtually it is already effective today," he said when asked whether the budget rule may be introduced starting 2018.

According to Belousov, the new budget rule, which is aimed at reducing the dependence of Russia’s budget on market revenues, is virtually effective now.

"Virtually it is effective. It does not cover the Finance Ministry’s purchases (of foreign exchange), the Finance Ministry’s purchases have nothing to do with the budget rule. The essence of the budget rule is that the level of expenses implying the oil price of $40 per barrel is cut off. It has been differentiated between the actual exchange rate and the budgeted exchange rate. It seems a decision has been made that the budgeted exchange rate (in the current 2018 budget law will be applied)," he said.

Presidential aide added that he thinks the new budget rule should be officially introduced as soon as possible.

"There are no heated discussions around the budget rule now and everyone expects it to be applied as soon as possible," he said.

The essence of the rule is to transfer additional oil and gas revenues, which are formed if the actual price of oil exceeds the target price, to the Reserve Fund. This mechanism was suspended in 2015 due to plunging oil prices.