Modernization and elections

The Russian federal budget has undergone its first reading in parliament, although with ambiguous reactions. The budget will be introduced to the Federation Council in late November. Alexander Kogan, Deputy Chairman of the Parliamentary Committee for Budget an Taxes, comments on the issue.

- You said that excises for alcohol, beer and cigarettes had been reduced. Does that mean cigarettes will be more expensive next year?

- This year we said that price will change by 6%. We have real inflation at a level of 7-7.5%. Next year it will be at 5%. I believe that we will try to keep it that way and excises will not affect it. I may say that we are increasing excises for cigarettes will be increased sufficiently, for alcohol - insignificantly, for beer - partly. I may say that we will gain income of about 20-28 billion rubles from the measures. We have a lot of fake products at the moment, Stepashin (Chairman of the Russian Accounts Chamber) has spoken at the parliament for greater attention to the issue, saying that there will be major losses and that the higher the price for alcohol - the less levying it will bring. He mentioned 40 billion rubles which have not been collected in 2011. There is poor administration of excises for alcohol. Sales of cigarettes and alcohol are very insufficient for the GDP, which is why they will not affect inflation. As a man who has never smoked and who hardly drinks, I hope that people would drink and smoke less.

- What concerns 2013 and 2014s, what is the reason for reduction of healthcare and education financing and how will the government save money?

- I would like to remind you that were are concluding certain programs. We will conclude the reconstruction program in 2013. Large sums are provided for reconstructions of municipal hospitals and polyclinics, purchases of medical equipment. Expenses in 2013 will be reduced. In addition, some projects related to the national project are coming to an end: purchases of equipment, increase of equipment provision. This is why there will be an increase in support, rather than reduction.

- How will the budget affect development of the Russian economy, should it be approved?

- Questions regarding development of economy, stimulation of budget, but certain structures and ministries speak for their own spheres which determine their efficiency. Today, unfortunately, it is too early to talk about diversification of economy. Dependency of the budget on prices which are determined by prices for oil, gas and raw materials is high. I would not take the responsibility to say that there would be radical changes in 2-3 years. There have been few programs passed for projects we are currently launching and investing in to modernize economy, innovative economy and modernization of economy, but we misunderstand the volume of the word "modernization". Journalists ask me how do the words "elections" and "modernization" match. The words cannot be matched. When we talk about elections we need to tell people about prospects, development, a dream needs to be put out correctly and technologically.

When we speak about modernization we ask about the right way to tell people that they are fired. This means retraining of specialists, high demand for their qualification and former staff does not always meet the expectations. We talk about reduction of workplaces due to robotization. Regional and municipal authorities need a clear image on employment for people who are really or theoretically fired. If there is no such understanding in regions, can you imagine what modernization would look like? The development of the economy is a serious issue and the state or society must be prepared for it.

15.11.2011 / Author: VK