Matviyenko Urged To Prepare For "severe Austerity" Of Money In The Russian Budget
- 16.07.2025, 21:14
"Some Russian national projects will be put under the knife.
The motto of the 2026 budget, which officials are starting to prepare, should be "severe saving" of money, the speaker of the upper house, Valentina Matvienko, said at a meeting of the Federation Council on Wednesday.
"The motto of the next budgets is severe saving, efficiency of every ruble, control over every ruble and regional budgets," Matvienko was quoted by Interfax as saying.
"Some national projects can be put under the knife" - the expenditures on them "would be correct to shift to the right for a couple of years," the head of the Federation Council Committee on Budget and Financial Markets Anatoly Artamonov suggested at the same meeting.
Budget consolidation should be started "urgently," he urged, as assessments of the state of the economy have become "more pessimistic" and oil and gas revenues are declining.
Budget priorities will still include "meeting the needs of security agencies" and "special military operations," Finance Ministry head Anton Siluanov replied to Artamonov. The 2025 budget allocates 13.2 trillion rubles for the army and arms purchases, and another 3.45 trillion rubles is earmarked for the "national security" article, which covers the budgets of the Interior Ministry, Rosgvardia, Investigative Committee and special services. In total, force expenditures reach 40% of the budget.
"First of all, it is necessary to realize the tasks that the country faces," Siluanov explained, adding that some infrastructure projects may indeed be postponed to a later date. "This is �...> a question of prioritization of financial opportunities," Siluanov said.
Russian authorities are considering forced cuts in budget spending due to falling oil prices and exhaustion of the National Welfare Fund, sources close to the government told Bloomberg earlier. According to them, the government is considering a reform of the budget rule - the mechanism under which the money of the National Welfare Fund is spent. Now the Ministry of Finance "prints out" the NWF to cover falling oil and gas revenues if the price of Urals oil falls below $60 per barrel. From next year, this "cut-off point" may be lowered to $50. And this could mean the need to cut spending by 1.5-1.6 trillion rubles, according to estimates by Alfa Bank.
In the first half of 2025, according to the Ministry of Finance, oil and gas revenues of the budget by 17%, while total revenues grew by only 3%, that is, in real terms (adjusted for inflation) began to decline. At the same time, expenditures jumped by 20%. As a result, in six months the budget deficit amounted to Br3.7 trillion - 6 times more than in the same period a year ago.
Reserves for patching budget "holes" are nearing exhaustion: the liquid assets of the National Welfare Fund, which before the war reached $120 billion, by July 1, 2025 have decreased to $52.6 billion, that is, almost 2.5 times. If oil prices remain low, this reserve will be completely used up as early as next year, economists from the Russian Academy of National Economy and Public Administration warned.