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#9 - JRL 8290 - JRL Home
PUTIN HIGHLIGHTS RUSSIA'S BUDGET PROBLEMS

MOSCOW, July 12 (RIA Novosti) - In his budget message, President Vladimir Putin points out basic related problems. Russia will not improve its budget policies unless it copes with them, he says.

The acting budget legislation fails to meet contemporary standards in full, and available procedures and practical patterns are limiting opportunities and stimuli to make government finance management more efficient.

The government economic sector is too big and bulky to be managed effectively-hence its inadequate economic efficiency. A sizeable part of government property is not used to do public duties, and ungrounded privatisation limits survive to this day for certain kinds of property.

The arrangement of companies and areas entitled to government allocations leaves much to be desired, and so reduces federal expenditure efficiency.

Allocations are distributed between government-financed companies and offices, as of old, irrespective of service amount, quality and public effect. Government monitoring of federal offices' extrabudgetary activities is largely formal.

Target programmes are not taken into sufficient account in budget formation. Another big problem remains unsettled-compliance with government obligations on investment projects and other programmes whose implementation takes longer than a fiscal year.

Practical arrangements of commodity and service purchasing for government needs hamper thrifty budget spending, while a government purchase law that reflects the current situation has not been passed to this day.

Russia has not yet blueprinted efficient machinery to guarantee affordable high-standard health services for all population groups. Emphasis here must belong to the unemployed. No progress has been made to establish a new system of compulsory health insurance.

True, an overall tax burden on entrepreneurial activities has come down, yet it remains draconian in many economic fields.

A fiscal reform, now underway, has not done enough for fiscal administration. This country has not streamline tax accounting any sizeably, and has not improved fiscal bodies' contacts with taxpayers, points out the federal President.