The newspaper «Moskovskiy Komsomolets — Ugra» published an article of the Governor of the Autonomous Okrug Natalia Komarova about midrange budget priorities of Ugra
The newspaper «Moskovskiy Komsomolets — Ugra» published an article of the Governor of the Autonomous Okrug Natalia Komarova about midrange budget priorities of Ugra
Midrange budget priorities of Ugra
In the next few days the budget of the Okrug for the coming three years is going to be discussed by the Deputies of the Okrug Duma. Traditionally in the Russian society the main financial document is considered to be specifically a tool for officials and a technical tool of funds' distribution where it is difficult to see the tasks and the vectors of the country's, region's and each person's development. I believe it necessary to change this stereotype through the look on the financial policy as a mechanism of implementing our midrange priorities.
There priorities are made up of the total vision of future secured in Presidential decrees, the Strategy of the Okrug 20-30, in state and municipal programs, as well as from external challenges that we have to be as ready for as possible.
What are these challenges about? The three-year budget was being prepared in the conditions of strengthening the turbulence of the world financial and economical system that has touched upon Russia as well. The country has gone through half a year with the lowest tempo of economy growth since the time of the world financial crisis, and the forecast of the social-economical development for the next three years signals the risks of the reduction of prices for oil, weakening of the national currency rate, intensification of competition in the world financial investment fields.
These risks only intensify the relevancy of the course that we have determined for the region with our whole Okrug when we developed Strategy 20-30: the provision of stable development through strengthening the present and the future potential of Ugra to improve people's quality of life and long-term development of the territory.
Our three-year budget works to achieve three key mid-range priorities that are necessary to supply in order to follow this course. This is available and high quality infrastructure for people to live and work with, a competitive atmosphere for business and investments, maximum effectiveness and targeting of work of public finances.
Acceptable and high quality infrastructure for people's life and work
The world experience of past centuries and how the leading growing economies are acting at this time confirm the far sightedness and justifiability of investments into infrastructure even during the most economically complicated times. The development of the infrastructure are new work places and entrepreneural niches, conditions for economics activization, a universal way of re-distribution of labor resources in the field that are able to provide for long-term economic growth. The relevance of the latter increases due to economy modernization, first of all, with the modernization of the fuel and energy complex and related sectors, which objectively leads to changes and requires more mobility in the labor market. Indecisiveness and time-out in the infrastructural issue create serious risks of social tensions and putting the economy into an infrastructural dead-end.
That is why the three-year financial cycle was planned with the Autonomous Okrug budget deficit which will give us an opportunity to stay stable and predictible for our partners and investors in continuing developing strategic infrastructure projects implemented using the budget for development. This is a measured and realizable decision for our region. Last year more than one third of the regions of the country had state debt 50% higher than the volume of income of the regional budget without taking into account the intergovernmental income. For Ugra this indicator today is more than ten times lower, in three years the maximum amount of our state debt should not be more than the level of 40%.
The budget is also set to resolve infrastructural tasks, and a set of state programs accepted in the current year, related to the strategic priorities of Ugra development. Total expense of investment character in programs are planned taking into account growth. For example, in 2014 they will be 42.7 billion roubles (that is, with the growth of almost 24% to the level of the current year), and in 2015 they will be more than 37.7 billion roubles (the growth of more than 9% to the current year).
The main priority is to preserve the increase in transport accessibility, building of housing, kindergartens and other infrastructural sites, preparing engineering infrastructure for investors should not drop.
Not long ago a strategically important site of the Northern latitudal corridor, an automobile road Ivdel — the border of Ugra was put into operation. The road to the Urals and the European part of Russia from the Western areas of the Autonomous Okrug was reduced by 600 kilometers on average, the economy on transportational and other disbursements from the opening of a through route is calculated in hundreds of millions of roubles every year. Ugra residents waited for 17 years for the appearance of another strong alternative channel of communication for the Autonomous Okrug with the outside world and these are justified social and economical investments. By 2020 approximately 33 billion roubles will be invested in the development and further surface infrastructure development of Ugra area of the Northern latitudinal corridor, which by itself creates new work places and stimulates the economic activity in the Western territories of Ugra.
Such complex and infrastructural projects will be popular in the future as well, with the correction that the deadlines in their implementation in the modern world have to be significantly reduced. At the same time, we will continue adhering to the rule — first of all, liquidating long-term constructions and unfinished constructions that, in essence, are «a black home» of any budget.
The agenda of the day includes megaprojects on building two new bridges over the Ob river in the area of Surgut and Priobie area, as well as the road Bereozovo-Saranpaul. Approximately 90 billion roubles of investments are going to be attracted for these three projects. The construction of these and a number of other sites, in essence, should place the historically established opposition of Ugra and «the Great land» to the past.
Besides, in mid-range perspective, we are going to be annually providing approximately 4 billion roubles for the development of a regional network of roads, approximately 2 billion roubles for the construction and reconstruction of local importance roads. From January 1 of the next year the sources of forming the Okrug road fund will be expanded from the deposited in it transportation tax in full amount. As a result, the total increase in the length of roads based on three years should be 223 kilometers, 3 populated location in Ugra that did not have access to an automobile network in the past will get it.
A serious advance ahead in the future will be made in the development of broadband Internet to eliminate the digital inequality. These technologies have double purpose, on the one hand, opening people access to the information in the global network, and, on the other hand, allowing to more effectively use budget funds due to providing state and municipal services in the electronic format, wide implementation of technologies of distance medicine and education, other modern and sought-after capabilities in the world. Investments into the telecommunication infrastructure form opportunities for the new quality of life and services in remote, hard to reach and small settlements. Today, in 161 populated localities of this type there is either no telecommunications infrastructure for connecting households to broadband access on the Internet, or the services are provided with a significant limitation of speed. The project on liquidation of this digital inequality costs approximately 8 billion roubles, and we are planning to implement it using the mechanisms of state-private partnership, providing as favorable conditions for investors as possible.
Another key and burdened with serious historical debts infrastructural block is the housing and public utilities complex for us. Last year, by virtue of the team's cumulative effort of the Okrug and the authorities of local self-governance, more than 1 million square meters of housing were put into operation in Ugra. This is a record from the times of the Soviet Union. Our budget measures of support of the construction industry suppose that in the coming years we will be holding up the high bar. The biggest number of investment projects with state support now is in housing construction. We are stimulating the preparation of land sites and engineering infrastructure. By localized taxation preferences we promote forming, new for the region, market of affordable housing. Overall, Ugra residents' housing support will receive almost 76 billion roubles over the next three years in accordance with the state program.
By January 1, 2016 condemned buildings will be completely liquidated, which concerns buildings that were considered condemned before January 1, 2012. The growth of the housing area per Ugra resident over these three years will be more than one square meter, and the number of issued mortgage credits, despite the changed economic conditions, will not drop. Privately owned apartments or houses should become more available due to having a new mechanism of the accumulating mortgage, «cooling off» of the housing market, as well as the moderate inflation in the economy overall. It is expected that the whole three-year budget cycle will be restrained within the lowest limits for our modern history of our country.
Low inflation is the positive side of the economic growth slowing down. However, other than that, it will be caused by the freezing of the regulated tariffs of natural monopolies. This will directly impact the cost of utility services, the quality and accessibility of which is the most important priority for us. In relation to this, in the next year, record amounts are put in the sphere of the housing and utilities infrastructure, i.e. 23 billion roubles. This financial injection is designed to revitalize the industry, to increase its energy effectiveness and its technological equipment. Among the results of these measures I will note that the number of populated areas of the Autonomous Okrug that has not been equipped with the centralized energy supply will be reduced by a quarter. This consolidation of forces has to protect the population as much as possible from any rate spikes, keep the indexation formula at «inflation minus».
In order for these opportunities to convert into stable development, significant investments will be directed towards the development of modern education and science, high technology health care, improvement in the quality of work of social services, increase in the availability of culture and sports. The goal of these investments is to create the necessary conditions for the all-round development and maximum self-realization of Ugra residents. I cannot stop but repeat that Ugra is rich in talents, and we have to create a fruitful environment for all of them to be realized, to produce innovations in their area, to work for our competitiveness and stable development.
We preserve the priority social direction of the budget policy. More than 73% of expense for the next three years is the investments into the development of human capital. The programs directed towards it will increase their resource potential during the whole three years. Everyone who receives assistance payments, special payments and compensations will be fully provided with those during the whole budget cycle taking into account the annual indexation of them.
Despite the fact that during all these years the population of Ugra will be growing (by 2016 the number of Ugra residents will make it through the mark of 1 million 650 thousand people), the budget financing of health care recalculated per each Ugra resident will increase. This approach will allow to significantly advance in terms of basic indicators that reflect the quality of our medicine. In particular, the life expectancy at birth should grow and be more than 74 years. Each fourth budget rouble will be invested into health care. At the same time we are expecting and counting on the medical specialists and citizens to be on our side working on improving the population satisfaction with the quality of health care services with the same speed. This is possible only due to team work and reciprocal efforts, and we already have the site for that as the first in the country crowd-sourcing project «Together for adequate medicine». We need to use its capabilities fully and to achieve the result.
With the developed medicine and the work of other institutes that make Ugra one of the leaders in the country on social well-being of the population, we owe a lot to our indicators of the birth rate that annually grows. Our task is to support young parents, family institutes, and the institutes of maternity and childhood. First of all, it is to provide little children with high quality pre-school education. We started from low base, we have fewer kindergartens that on average in Russia. After several years of statutory and regulatory back and forths we started a project of a state-private partnership in the area of building new kindergartens. The total of state and private efforts should provide all children between 3 and 7 years old with spots in kindergartens by 2015.
The most important factors of stable development are the strategic provision of leadership in the area of your competencies in the world and creating new sources of growth. Both of these tasks require localization on the territory of Ugra of the main nucleus of the industry knowledge, and, therefore, a serious reinforcement of science and higher education. The bet on the development of science and innovations is also predetermined by the fact of the inclusion of Russia into the WTO. We have entered a phase of a more serious and less protected competitive environment where you yourself have to increase your competitiveness and form the innovative platform of the economy. We have created a network of Universities, research centers and scientific laboratories, we have a working park of high technologies, an Okrug business incubator, we have built a system of resource centers. Our plans that we have secured in the Okrug Strategy and the state program are creating a full modern University campus in Surgut that, in essence, has to become the place of concentration of regional intellect and center to attract scientists. During the implementation of this and other projects we will expand the partnership with the Russian Academy of sciences, Moscow State University and other key scientific and educational institutions of our country and the world. To reinforce the infrastructural base of our educational centers in the next three years the percentage of the development budget in the total volume of financing of the state program of the development of education in Ugra will grow by 3.5 times on average.
The competitive environment for business and investments
The structural transformation of raw material economy of knowledge requires the maximum comfortable weather for investors and friendly for growth of entrepreneurship business environment.
In the first half of the current year the volume of state support of investment activity was 9.3 billion in the Okrug. The vast majority of these funds are tax stimulating preferences: the reduction of the tax rate on profit and the property tax for separate categories of taxpayers. We use these measures, in particular, for stimulating the fuel and energy complex companies for modernization and effective use of associated petroleum gas resolving an important environmental task for people and contributing to the development of the oil and gas gluster. This support will be used in the future as well to stimulate companies to invest funds into the main capital, to build up geological exploration, to increase the energy effectiveness, to develop strategic for us diversifying industries.
If we evaluate the effectiveness of tax rebates, over the first half of the year for each budget rouble of the rebates that we have provided, we have attracted 25 roubles of private investments. The companies that have received this support have provided additional 2382 work places for people. At the same time, this policy contributes to turning our economy on the trajectory of «green growth», which is placed as one of the priorities in our Strategy 20-30. The energy consumption of the gross regional product in 2016 should drop by 22% compared with the current indicator, and the percentage of companies who are implementing technical innovations should grow for this period from the current 9% to 17.4%.
In the next budget cycle we will continue to stimulate investments into these sectors, moreover, from January 1 of the next year we are planning to completely release those business subjects from having to pay taxes that form an infrastructure of support of small and medium businesses, as well as implement projects to develop the market of affordable housing for rent. In essence, this measure should work to resolve two key social tasks — to provide Ugra residents with new work places, including those in remote and hard to reach settlements, and contribute to the unloading of housing waiting lists.
Other than tax stimuli, we will compensate investors with part of the expenses on paying interest on the acquired credits and part of expenses on building engineering networks and sites of engineering infrastructure. As of today, such forms of support is received by almost three dozen companies that are modernizing the residential and utility complex and developing the housing construction. One of the results of such measures became the growth of intensiveness of exchange of worn-out networks which permitted to reduce the incidents at heat supply and water supply networks by 50%. The historically accumulated problems in this issue make us increase efforts in this issue that is a priority for our Northern region.
We are finishing the implementation of the Investment standard in Ugra. Even now the results of this work are obvious. With the unstable situation in world economy, we are enhancing our investment potential, and, therefore, the profit base of the budget. For the first 6 months of this year the volume of investments compared to the last year grew for us by about a quarter. In absolute numbers, the investments into Ugra for the first half of the year in total were 314.5 billion roubles. Ugra credit ratings that were given by three international rating agencies Standard&Poors, Moodys and Fitch correspond to the highest level for Russian regions. I will note that the investment climate is changing for the better in Russia overall as well. Not long ago a new rating of the World Bank on doing business in different countries was published. Russia improved its positions right away by 20 lines in the rating, having surpassed China and Brazil.
Supporting this trend and implementing the Investment standard we realized the need, and in August we created a new institute of investment infrastructure — the Fund of Ugra Development. The funds to provide for its activity are prescribed in the three year budget. One of its key tasks is to systematically and locally set up our interaction with investment and venture funds, foreign state investment agencies, specialized Russian and international financial organizations and institutes of development to attract investments to the regional territory.
We have a solid investment portfolio for this type of work. There are about a hundred projects of the financial capacity of 700 billion roubles. More than 9 thousand work places of them are already being opened and are planned to be opened in the next three years, which will permit to create more than 9,000 work places the majority of which are high tech, and to increase tax inflow in the budgets of all levels for more than 9 billion roubles. In order to implement these plans, another new institute, Ugra investment fund, will take up the preparation of sites for specific investment projects and will accompany investments from the idea until its implementation in practice.
The creation of high tech work places requires special consolidation of stimulating measures, efforts of the government, business and citizens. Even now for us the level of unemployment is one of the lowest ones in the country — we cannot develop extensively, we need to increase the productivity and labor technological effectiveness.
A special role in these processes and the strategical development of Ugra is given to small and medium-sized business. Every sixth working Ugra resident is employed in small business. Today small businesses create almost 90% of new permanent work places in Ugra, in pre-crisis years this indicator, according to evaluation, did not exceed 40%.
A special emphasis in small business support in mid-range perspective will be made on stimulating the growth of social entrepreneurship. Over the latest years we have invested in its development more than half a billion roubles. Therefore, we have maintained more than 200 subjects of socially oriented business, the majority of which are related to pre-school education.
Last month we have given start to the work of the Center of innovations of the social sphere in the Okrug. It will accumulate the best practices, nurture such projects, teach our public figures and entrepreneurs to work with social projects. Where a social business is able to better provide social services, it will become their main supplier for the population with all the financing that it leads to.
Each rouble invested into the support of entrepreneurship allows to attract up to 10 roubles of private investments and, which is extremely important with the external economic risks, it contributes to the development of the internal market. These measures have an economical, but, even more so, social response for residents of monocities and settlements, remote and hard to reach populated areas, indigenous people of the North.
To create work places for residents of the territory with the special coefficient of tension of the labor market, our program of employment support will continue working. Even now, the stimulation of the labor market provides annually approximately 30 thousand work places, and the level of the registered unemployment in Ugra is one of the lowest ones in the country. It is important during the complex for world and Russian economy period for every Ugra resident to be confident in the source of his earnings, to be able to realize his professional potential. For that reason, our plan of actions in the labor market is built based on two key variables: the first one is further reduction of the level of unemployment; the second one is the increase in average monthly salary. By 2016, it should reach 69 thousands in the region.
The effectiveness and targeting of work of public finances
All our goals have exact, applied meaning. Still, they can be reached sooner or later depending on our speed of moving towards them. It significantly grows together with the increase of budget effectiveness. Each targeted and effectively used saved up rouble is an additional contribution in the development.
In order for the development not to stall without getting deviated from the direction, without leaving some territories out, citizens have to be the engine of it. The forming of the modern culture of local self-governance that has historical, deep roots in the Russian land is one of the key conditions of success of our stable development in the changing world. Our experience in having the public step of the development of Strategy 20-30, public selection of applicants for heading the most important social industries and other projects explain that Ugra residents are ready to this joined work with the government and are interested in it.
This task is set in the Budget message by the President of Russia Vladimir Putin and is implemented in our region using an interactive Internet resource «People's budget», crowd-sourcing projects, work of industry public and expert councils, anticorruption Internet resources and hot lines, public reports in front of citizens of heads of municipalities and the regional Government.
The new budget is 96% made based on the programming principle, which allows using a set of interconnected arrangements and inter-industry interaction to solve the key tasks of the social and economic development. The programming approach will permit specialists who are fulfilling the budget and all citizens to evaluate not only the effectiveness, assurance and target use of funds, but also the work results from each budget rouble to implement our Strategy 20-30.
But constant civil and professional participation in this program sets us up in the right mode and the system of actualization of the main long-term document of Ugra. Accepting the Strategy, we have implemented the new approach in Russian strategic planning, that implies periodic actualization of the basic document with complex scientific and expert accompaniment of this work on a permanent basis. This is what the scale of the task requires — by 2030 only along the line of the consolidated budget of Ugra we will need to manage the amount of 3 trillion roubles that makes us use all the possibilities to make verified decisions that are taking into account the opinion of the majority of Ugra residents.
This approach has to be also used in the budget process to analyze the expenses made, to make decisions about correcting old or implementing new ones. For that reason we will develop a so-called «budget light» system. I believe that it will be able to start functioning by 2016.
It will be based on the definition of three main budget colors and corresponding to them types of budget expenses. If the economical activity significantly worsens and the budget is re-assessed, the red color will be given to the untouchable expenses related to the fulfillment of obligations that are not sequestrable. The yellow color is for the expenses of medium priority, the reduction of which is only possible after public discussion. The green color is for the least protective expenses, stopping financing of which is possible only when there are significant social and economic changes. This scheme will make our budget system stable, flexible towards the external negative factors and at the same time will enhance the participation of the society in its formation.
The new budget does not only concern all of us, but it also depends on our participation in it. This is about timely performance of taxation responsibilities, the quality of work of each of us at our position. Reasonable economy, desire to change, helping those who need help have to become the common rule for all Ugra residents in order for it to work at the level of the whole region.
The speed of our development, how we are going to respond to today's challenges and create a platform for stable development depends only on us.