President Vladimir Putin signed the amendments to budget 2019, as well as the new budget for 2020 and the 2021-2022 planning period, according to reports in the local media. This completes the budget process. Amendments for this year increase spending by RUB196bn, most of which (RUB161bn) goes for recapitalization of the development bank VEB. The spending increase is financed from RUB194bn additional non-oil revenues, which makes it consistent with the fiscal rule. On the other hand, lower oil and gas prices and the additional compensation for oil companies have reduced the expected oil revenues by RUB398bn, resulting in overall reduction of the revenue part and the surplus. Thus, the surplus should reach 1.4% of GDP compared to 1.7% in the current budget.
The budget for 2020 assumes revenues at RUB20.38bn and spending at RUB19.5 trillion, resulting in a surplus of RUB876bn or 0.8% of the GDP. In 2021 and 2022 budget spending will be growing at a higher rate that revenues, resulting in gradual decline of the surplus to RUB295bn in 2022. Next year’s budget remains consistent with the fiscal rule and the gradual decline of the surplus reflects a conservative oil price forecast, which leads to declining additional oil revenues.