Real incomes of Russians are falling more than volumes declining economy, the Government’s Deputy Prime Minister Olga Golodets said at the session titled 'Improving the welfare of the population as a driver of economic growth in the Far East'.
"There are warning signs when the decline of economic growth differs significantly from the reduction in real incomes of the population, that is, real incomes are falling much more than the economy is reducing," TASS cited him as saying.
The head of the Regional Banking Association, the chairman of the Duma Committee on Economic Policy, Innovation and Entrepreneurship Development, Anatoly Aksakov, speaking with a correspondent of Vestnik Kavkaza, said that the situation reported by the Deputy Prime Minister was more than a year ago due to the overall macroeconomic situation, as well as not entirely correct actions of the Russian government.
"The government has indexed pensions by 4% and then decided not to index salaries of public sector employees. At the same time public sector wages in the regions are linked to the average wage in the subject. And if the average salary in the region declines, wages of public sector employees also decline. But then the average salary is reduced again and it is a vicious circle," the expert said.
According to the head of the Regional Banking Association, the chairman of the Duma Committee on Economic Policy, Innovation and Entrepreneurship Development, a reasonable indexation of pensions and public sector wages should be the first step towards solving the problem. "The poorly-off sectors of the population buy Russian goods, respectively, they raise the demand for them and therefore, their production will be increased, which will increase salaries," he explained.
Another negative factor here is the freezing of pension savings. "Frozen pension funds are not directed to investments, and investments is the incomes of citizens," Anatoly Aksakov summed up.
A professor at the department of the stock market and investments at the Higher School of Economics, Alexander Abramov, in turn, said that another reason for the decline in real incomes of Russians against the backdrop of slower GDP decline is a reduction in the workforce.
According to the expert, this year's GDP will drop by no more than 1%, but commercial companies have been forced to reduce the workforce. Previously, this process was partially offset by the fact that the state has supported the social sector, pensioners and state employees, but at the moment almost all of these programs are frozen.
"As soon as difficulties associated with financing, a higher key rate and volatility appear, business and population adapted to this situation most quickly. And business - by beginning to save on investment and wages," Abramov explained.
In the first place, the GDP growth, which requires favorable for Russia situation on the world market of energy resources, may positively affect the situation, the professor at the department of the stock market and investments at the Higher School of Economics noted.
In turn, a competent credit policies may become the internal factor in stabilizing the situation in the country. "I think the government is afraid that the expansion of the credit expansion will break idyll with a stable exchange rate and declining inflation. But this risk should be taken sooner or later. The economy cannot live without loans, therefore, the main way is to include lending mechanism into the economy," the expert said.
In conclusion, Abramov noted that the attempt to stabilize the economy by lending is associated with some risk, but they should be taken.
