For the next six years, Moscow will retain the budget policy used in recent years, as Sergei Sobyanin and Anton Siluanov, First Deputy Prime Minister and Minister of Finance, agreed at the Moscow Financial Forum.
“We will undertake a commitment to continue developing the economy and increase our contributions to the federal budget,” the Moscow Mayor said. “Our transfers to the federal budget continue to grow because of healthy economic growth and as a result, the Russian Government has an opportunity to allocate these public funds to other regions. I believe that Mr Siluanov and I have achieved consensus in this respect.”
The upward trend in recent years proves the efficiency of this system. “Moscow’s total allocations to the federal budget have grown by 2.2 times over eight years,” Mr Sobyanin said. “Sixty percent of all tax revenue from manufacturing in Moscow go to the federal budget.”
Mr Siluanov backed the Mayor’s position, saying that conditions for inter-budget relations and taxes would remain unchanged for the next few years. “We need to fix the terms for the next six years so the regions can plan for their federal funding and, correspondingly, their spending commitments.”
He also noted that the experience of developing the Moscow economy helped in restructuring the federal budget. For example, the ministry will put more effort into developing the economy, which will provide a higher average income for people and higher tax revenue.
“As far as the regions are concerned, Moscow is one of the major sources of tax revenue for the federal budget,” the Finance Minister said. “The Moscow budget has changed considerably over the last few years and these are positive changes for better development and a better structure.”
Mr Sobyanin said the fateful event for the city in the past was the decision not just to increase people’s salaries and develop the social sphere but to focus on developing the infrastructure and attracting investment.
Nationally, investment has grown 20 percent over the last eight years, while in Moscow this figure is 70 percent. The city maintains a permanent dialogue with investors setting specific and stable parameters for them.
“In addition to our assistance for investors and our joint investment in city infrastructure, we also ask for their support: we ask them to invest in social services, to build not only profitable housing but also create jobs – over half a million jobs have appeared in recent years. In terms of the volume of real estate, about two thirds is commercial property, which stimulates the economy and creates jobs and only one third is profitable housing,” Mr Sobyanin said.
All these measures allowed the city to allocate money to raise state employee salaries and to develop education, healthcare and social services.
The city will also offer benefits to Muscovites at preretirement age. “Very soon we will help senior citizens feel more protected and feel like they are on firm ground. This decision was made because Moscow benefits for senior people in the past were linked to retirement, now these benefits from the city will depend on people’s age. It means that when women reach 55 and men 60, they will enjoy city benefits even if they have not retired,” the Moscow Mayor said.
In addition, the city will provide opportunities for senior citizens to receive free supplementary education and will pay more attention to their healthcare.