Budget funds play a significant role in the functioning of the country and the fulfillment by the state of its obligations, including social ones. This article describes the concept, varieties, significance and characteristics of the funds of Russia.
The concept and importance of the budget fund
Budget funds are a type of financial funds created in strict accordance with domestic legal standards. They look like money specially allocated in the budget system, which is spent and controlled by government authorities. As a rule, these finances are accumulated for the subsequent financing of key types of economic activity of the country.
All budget funds in Russia are subject to the provisions of the current budget legislation. In addition, these structures, regardless of their type, should not violate other legal norms. As a rule, funds are pledged by the executive branch at the federal level, within the framework of the law on the state budget for the coming financial year. Moreover, the formation of budget funds is allowed not only in the center, but also in the constituent entities of the Russian Federation, and even in the municipality. Budget funds are replenished through the receipt of money from the treasury, special fiscal contributions from individuals and legal entities, targeted state loans, treasury securities (bills), etc.
Funds play an important role. In particular, budget funds are the monetary basis for the implementation of tasks and social obligations of the state.
Varieties of funds
Funds can be classified according to various criteria:
1) In the presence of direct connection with the state treasury there are budgetary and extra-budgetary funds.
2) In the direction of use of funds: target and non-target.
3) By level of education: state, funds of constituent entities of the Russian Federation, municipal.
In addition, in the form of budget funds, they can be classified into targeted budget funds; reserve funds and funds created as part of the treasury costs of a certain level of power.
Budget funds created to solve a specific problem
Distinctive features of the target budget fund can be called: profile focus on spending the funds stored in it; formed due to the profit of the intended purpose; the profit coming into it is associated with certain goals of embezzlement; the receipt of finances and their embezzlement is carried out annually for the entire life of the fund There is a relationship between the duration of the fund and the time it takes to implement the task for which it was formed. Thus, targeted budget funds is an organization that consolidates funds intended to solve specific problems.
All budget funds ceased to exist after the entry into force of the amendment law in the RF Budget Code on April 26, 2007. However, in the theory of budget law they still exist. The budget funds of the Russian Federation include the national welfare fund, investment and road funds.
The first was a share of the state treasury money, which had to be accounted for and controlled separately to provide additional monetary support for the voluntary pension savings of the Russian population and create a balance (eliminate shortage of funds) of the budget in the domestic Pension Fund.
The second of these funds was created to additionally finance developments that were supposed to attract investors. According to the budget legislation of Russia, funds from the fund should have been spent to implement investment projects.
The road fund was formed to provide monetary support for repair work and improvement of domestic highways of general use; overhaul and reconstruction of the adjacent areas of multi-storey residential buildings, entrances to the yards of multi-storey residential buildings in various cities.
Features of the reserve fund
Reserve budget funds are a share of the finances of the state treasury, which is accounted for and controlled separately for an oil and gas transfer when there is a shortage of profit from trading in “blue fuel” and “black gold” to provide cash for this transfer.
The standard size of this fund is set in a certain amount, based on 10% of the GDP projected for the coming fiscal year, reflected in the Federal Law on state revenues and expenditures for the next fiscal year and the planned term.
The purpose of managing the finances of the Reserve Fund is to maintain the integrity of the finances of the Fund and the constant value of profits from its placement in the distant future. The management of related finances provides for the likelihood of a drop in income or loss in the near future.
The Ministry of Finance manages the fund’s money in the manner that the main executive authority of the country determines. Some functions for managing the money of this entity can be performed by the Central Bank of the Russian Federation.
The financial management of the Reserve Fund can be carried out by one or a set of methods:
- With the help of money purchase of a fund of a foreign currency unit and its placement on deposits for accounting the fund’s finances in foreign currency units (USD, €, English currency) with the Central Bank of the Russian Federation.
- By placing money of the Reserve Fund in foreign financial assets and monetary assets calculated in monetary units of other states, the list of which is established by domestic legal norms.
The Ministry of Finance of the Russian Federation manages the Fund’s money in the first of these methods.
General Description of Extrabudgetary Funds
Extra-budgetary funds are independent monetary structures and entities, which for the most part have the legal status of an organization.
Extra-budgetary funds created by authorities are trust funds with their own funds with a common center, formed outside the state treasury thanks to the financial contributions of organizations and created to fulfill social obligations to the Russian population (payment of pensions, benefits, insurance, health protection and medical support).
These funds are autonomous in economic and legal terms from the federal, regional and municipal treasury. The financial assets of these organizations are not included in the total amount of profit and embezzlement of the state treasury. However, money from extrabudgetary funds is the property of the authorities, which determine the procedure for their functioning.
Any extra-budgetary fund, unlike targeted budget funds, works independently of the treasury (more precisely, the relationship is not direct, but indirect).
The need to create such structures was due to several reasons. The main foundation in the economic sphere is the need to increase the sources of sponsorship by the authorities of the country's socio-economic needs. In other words, the task of extra-budgetary funds is to take control of the most significant areas of the general economic development of the state and the public sector.
The authorities indicate the purpose of the formation of the fund, as well as the procedure for spending its financial assets.
Varieties of extrabudgetary funds
The system of budget funds includes many varieties of these institutions.
According to their intended purpose, extra-budgetary funds are divided into those that have a national character (formed to resolve significant difficulties in the economic sphere as a whole: roads, the environment, the customs industry, reducing criminal indicators, etc.) and those that are created to solve a specific problem (formed to finance social needs; education; science; medical sphere; increase employment). Money from any extrabudgetary fund is placed on special deposits.
Another criterion for dividing is the level of education of the fund: state, subject of the Russian Federation or municipality. The receipt of funds from the fund is carried out exclusively to solve certain problems. Moreover, money for meeting public needs from such funds comes in a much larger amount than from trust funds.
Extra-budgetary funds are also subdivided into social (for example, the PF of the Russian Federation, the Social Insurance Fund, the compulsory medical insurance fund) and general economic. In the latter case, as a rule, we are talking about funds of budgetary institutions. The latter included, for example, the Fund of the Russian Ministry of Atomic Energy; state fund of the Ministry of taxes and fees, etc.
The specifics of the RF PF
The PF of Russia is a financial asset fund created independently of the state treasury to provide monetary protection for Russians from a specific type of public threat - loss of salary (or other stable profit) due to old age, disability; for disabled citizens - at the death of the breadwinner; for some groups of employees, the long-term execution of a specific labor task. It is forbidden to spend financial assets from the PF for purposes other than those listed above. Pension savings include 3 parts: basic, funded and insurance.
The Pension Fund is replenished thanks to such sources as: money from the state treasury; the amount of interest and other monetary penalties; income from investments of temporarily unoccupied finance of compulsory pension insurance; insurance payments for compulsory insurance of pension payments; voluntary payments of citizens and legal entities; other legal sources.
The specifics of the FSS of the Russian Federation
The public insurance fund is in second place in importance. It is a specialized monetary structure under the supreme executive authority of the country. Its function is to manage the funds of state public insurance.
The key objectives of the creation of the FSS can be considered: the payment of federal social assistance to the Russians, sending them to resort and sanatorium medical procedures; participation in the creation and implementation of federal programs to protect the health of the employed population; carrying out activities that contribute to the monetary stability of the fund, establishing the size of insurance payments; organization of training activities for employees of the federal public insurance structure; partnership with identical foreign organizations and interstate structures in terms of public insurance.
The sources of the Fund's financial income are: insurance payments of various employers; insurance payments of people with IP status; insurance payments of Russians employed on other conditions; profit from investing temporarily unoccupied financial assets of the fund in bank deposits and high-value federal securities; voluntary payments of organizations and Russians; other profit.
Fund financial assets are mainly spent on: funerals; the provision of benefits for the temporary loss of the opportunity to carry out labor activities, childbirth and pregnancy, when a baby is born and cares for him until he is 1.5 years old; referral to wellness treatments at resorts; other purposes listed in legal norms.
The specifics of the activities of compulsory medical insurance funds
These structures are being formed at the local government level to consolidate funds to protect public health. MHI is an invariable component of federal public insurance and provides every Russian citizen with the same right to treatment with the help of finances from MHI.
In order to implement measures in the field of medical insurance, state and regional MHI funds are formed as independent non-profit credit and monetary structures.
MHI funds are designed to fulfill a number of tasks: to make the conditions for the functioning of regional MHI funds identical; allocate money for the target set of measures within the compulsory medical insurance; to check the correctness of the waste of monetary assets of CHI.
At the national level, the sources of income to the compulsory health insurance fund are: the share of insurance payments of economic entities; payments of regional MHI funds for the implementation of joint activities carried out on a contractual basis; financing from the state treasury for the implementation of republican measures of compulsory medical insurance; voluntary payments of organizations and citizens; profits from the use of temporarily unoccupied money from the state compulsory health insurance fund
Budget funds of the state and power structures
The federal budget funds included: cash assistance funds created as part of the Russian state treasury to solve the country's problems at a certain stage in the development of the economic sphere. An example is the State Fund for Co-financing of Waste; fund of financial assistance to subjects of the FFPS; state compensation fund.
One of the main requirements for the functioning of the state budget fund is the mandatory supervision of its creation and the targeted use of financial assets placed on its deposits.
Authorities supervise both the legality of spending money and the effectiveness of their use. The structure of such funds in the state treasury is changing. They can form or eliminate. This is also true for regional funds.
The budget and budget funds have a direct connection, in contrast to similar extrabudgetary structures, where it is indirect.
In addition, it should be said about the special funds of various authorities (for example, the Fund of the Russian Ministry of Atomic Energy). Their composition is formed from financial allocations for certain tasks. Then the money is distributed and spent in accordance with the law. Treasury money is wasted mainly on measures conducive to the continuous operation of such a structure.
Profit is created on the basis of calculations calculated separately for each source of profit.
