The main item on the agenda: execution of the 2013 federal budget.
Opening remarks by Dmitry Medvedev:
Government meeting
There was a train collision near Moscow yesterday. Unfortunately, there were casualties, and condolences were expressed to the families and friends of the victims. I would once again like to offer condolences on behalf of the Government. The rescuers have done their work. Now doctors and law enforcement agents are at work. It is imperative to take decisions on all major issues and bring relief to this disaster. Russian Railways is fully aware of its responsibility. I spoke with the head of Russian Railways today. They will conduct a technical investigation. Since the casualties include foreign nationals, we need to provide proper consular and other support.
Dmitry Medvedev: "Last year, just like this year, was not easy for the budget, and its execution was also difficult at times. Nevertheless, macroeconomic stability has been maintained, and all social commitments have been honoured."
Now back to the agenda. We are reviewing the execution of the federal budget for 2013. Last year, just like this year, was not easy for the budget, and its execution was also difficult at times. Nevertheless, macroeconomic stability has been maintained, and all social commitments have been honoured.
Perhaps this is the most important result. The key parameters are known: the gross domestic product increased by 1.3% in value terms in 2013 as compared with 2012 – the total amount is 66.8 trillion roubles – and last year’s revenue is about 1% above the projections at over 13 trillion roubles. Our spending was a little over 13 trillion roubles. The deficit amounted to 323 billion roubles, which is less than we expected. In this sense, we can say that the budget deficit was completely under control and stayed within the parameters that we discussed.
The Reserve Fund and National Wealth Fund expanded. The Reserve Fund grew by 974 billion roubles, almost to 3 trillion roubles, and the National Wealth Fund is up 210 billion roubles, which is also close to 3 trillion roubles.
Dmitry Medvedev: "The key parameters are known: the gross domestic product increased by 1.3% in value terms in 2013 as compared with 2012 – the total amount is 66.8 trillion roubles – and last year’s revenue is about 1% above the projections at over 13 trillion roubles. Our spending was a little over 13 trillion roubles. The deficit amounted to 323 billion roubles."
Traditionally, the oil and gas sector accounts for most of the revenue, just over half of the total. We keep talking about ways to monitor this situation. We have a budget rule to that effect. However, we need to look into what led to such a situation. We agreed to discuss this subject and find out how oil and gas revenue relates to revenue from sources other than oil and gas, and how this ratio is important for economic development, given that the economic situation is changing.
Reports on execution of the budgets of the Federal Mandatory Medical Insurance Fund, the Social Insurance Fund and the Pension Fund for 2014 were also presented for approval by the Government today. In general, the revenues of these funds have grown even faster than planned over the past years. We financed the programmes that are supposed to be financed from these funds and allocated finances for one-time compensation payments to medical workers and several other important initiatives. Clearly, the situation is under control.
Dmitry Medvedev: "The Pension Fund’s budget has been executed with a surplus. The pensions were adjusted based on the subsistence level of retirees. Pensions under state pension provision, pension supplements, allowances, and monthly payments to people with disabilities, war veterans, bearers of special ranks, and recipients of maternal or family capital, which has also been adjusted for inflation and now stands at 409,000 roubles, have been paid out."
The Pension Fund’s budget has been executed with a surplus. The pensions were adjusted based on the subsistence level of retirees. Pensions under state pension provision, pension supplements, allowances, and monthly payments to people with disabilities, war veterans, bearers of special ranks, and recipients of maternal or family capital, which has also been adjusted for inflation and now stands at 409,000 roubles, have been paid out.
The average amount of old-age pensions increased by 926 roubles and reached 10,716 roubles in early 2014. The average social pension increased by 527 roubles to 6,447 roubles.
Social pensions to children with disabilities, people born with disabilities and monthly payments to certain categories of recipients have also increased.
Then, we’ll move on to the 2014 budget and review the amendments to the law On the 2014 Federal Budget and the 2015-2016 Planning Period.
The total revenue increased by 748.2 billion roubles. The expenses remain unchanged, but funds in the amount of almost 187 billion roubles in three main areas will be redistributed. Please note that this is an increase in the budgetary allocations for the priority areas identified by the President and the Government in the amount of over 50 billion roubles.
About 114 billion roubles of resources are being redistributed based on the proposals of ministries and departments. The third separate area which appeared this year concerns the implementation of measures for the socioeconomic development of the Republic of Crimea and the city of Sevastopol in the amount of almost 22 billion roubles.
There are several other important topics. As you may be aware, Russia, Belarus and Kazakhstan are nearing a landmark event, which we have been working on consistently over the past few years. In late May, the presidents of the three countries will sign the Treaty on the Eurasian Economic Union. Today, we will review the draft. We worked hard to codify the contractual framework of the Customs Union and the Common Economic Space. This work was performed in conformity with WTO rules. We were looking for a compromise on key issues until the very last moment. Presidents and heads of governments, and the governments in general, were involved in the negotiation process. Largely because of this, we were able to provide a legal framework for creating a full-fledged common market, although there will be transitional periods that are necessary to adapt the most sensitive sectors. But, strictly speaking, no integration association can avoid a transition period. We're moving ahead quickly already, perhaps much faster than many other integration associations in the world.
Dmitry Medvedev: "The average amount of old-age pensions increased by 926 roubles and reached 10,716 roubles in early 2014. The average social pension increased by 527 roubles to 6,447 roubles."
Government meeting
I hope there will be new opportunities for people and businesses that work across the three countries. Hopefully, the barriers in mutual trade will be overcome, and equal conditions for competition will be created. All this will allow us to become more sustainable in macroeconomic terms and make better use of the potential for economic integration.
Another important draft law concerns transport fares. Traditionally, the fare includes baggage transportation and related costs, but many passengers often travel without baggage, and, accordingly, pay extra.
Now, the airlines can use tariffs where baggage will be charged separately, but passengers will continue to be allowed free carry-on baggage. It’s imperative that we harmonise various approaches to the free transportation of baggage, because different carriers set different rules, but the draft law establishes a single baggage allowance of no less than 10 kg, or at least two pieces of baggage.
In closing, I’d like to remind the audience that our Government was formed two years ago. Over these two years, we have addressed major issues that are important for our country. We managed to accomplish some things, but we have many more ambitious and large-scale projects that we must deal with. I’d like to thank you all for your well-coordinated work over these two years.
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