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Saturday, August 19, 2017

The Finance Ministry is going to reduce the real cost of health care and education

The Ministry of Finance of the Russian Federation made a proposal to “freeze” the expenditure budget for three years 2017-2019, according to “Vedomosti”.

photo: Natalia Muslinkina

This means that Federal spending adjusted for inflation, even with its limitations 4% (to put the goal before the Central Bank), three years in real terms will decrease by 20%.

And affected primarily social items: health, education, social support, housing. Also under the reducing falls and spending on agricultural support. A total of 42 expenditure items are thus reduced 36.

The greatest damage will be inflicted to the state program on development of physical culture and sports, as well as the support of the Far East and the Baikal region: in the first case we are talking about more than a twofold decrease in the second — twenty.

The spending on the defence industry constituting a significant portion of the closed articles of the budget can be reduced by 15%.

In the opinion of the economic block of the government, cost cutting can bring its advantages: it will reduce the budget deficit and lead to budget discipline, according to Alexei Ulyukayev and Anton Siluanov.

While chief economist VEB Andrei Klepach recently noted that the situation in the Russian economy is developing much worse than expected, and Prime Minister Dmitry Medvedev said that the government intends to return to the indexation of pensions to inflation in 2017 and does not weaken the support of agriculture.

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