Budget is a term that can be interpreted very broadly. But most often it is used when it comes to state affairs. What forms of budget are currently operating in Russia? How similar are they to those found in world practice?
What is a budget?
In a broad sense, the concept of budget reflects any source containing a resource in the form of cash. But, as a rule, this term is used in the context of, as we have said, state financing. And in this case, the concept of the budget can reflect not so much the source of something, but the whole system within which cash flows are managed.
The budget sphere is often opposed to the commercial one. Why? This division, it must be said, is rather arbitrary. Both business and budget structures deal with financial flows, revenues, expenses, and sales. The enterprise of some officials (we say without any subtext) sometimes will give odds to businessmen with experience. What is the fundamental difference? The main criterion that distinguishes business from budgetary structures is the goal of establishing economically active entities — enterprises, social institutions, and management organizations. In the case of business, this is profit in favor of the owner, who can then distribute it at his discretion. He wants to - let him solve social problems, and if not, he will buy a yacht or a house on an island in the Mediterranean Sea.
If we talk about budget structures, the goal of their establishment is exclusively social tasks, as well as those related to the maintenance of state sovereignty as such, the implementation of a social contract concluded between the government and citizens. The state, making money (selling oil, levying taxes, etc.), does this in order to direct the proceeds to the payment of salaries to teachers, doctors, security officials, and the military.
Thus, the financial budget of the state is a resource on the basis of which it, in fact, functions. How does the government build a cash flow management system? Now we will study this aspect.
Fundamentals of state budget policy
In many countries of the world, including Russia, there is a federal budget. It implies a financial system administered by the highest authorities - government, president, parliament. Depending on the structure of the political system, the form of government, budgets can also be regional, municipal (as in Russia) or have other localized options.
At each of the budget levels, the relevant government institutions are working on revenue generation, as well as managing cash flows in the aspect of expenses. Perhaps "inter-budgetary" interaction. Often it is expressed in mutual assistance between structures of different levels. For example, when subsidies, subsidies, subventions in favor of regional or municipal are allocated from the federal budget, or appropriately issued loans are issued.
Russian budget structure
Let us consider how the financial budget is structured (in the sense that by this term we mean the established system of cash flow management by the state) in Russia. The main legislative source governing this area is the Budget Code. According to this regulatory act, the structure of the state financial system is built on four main levels: federal, regional, local and local (the latter two are combined by some experts, but they are specified separately in the law).
At the first level, federal authorities control financial flows, respectively. They manage revenues and expenses within their competencies. At the second, financial flows are controlled by the authorities of the constituent entities of the Russian Federation - republics, territories, regions. In the third - municipalities (districts, urban settlements). On the fourth - local settlements (villages, villages).
There is the concept of a "consolidated budget." It can be applied in two contexts. If we are talking about the aggregate income and expenses of the financial systems of municipalities, their local communities and the entire region, then a regional consolidated budget is formed. In turn, their totality for all subjects of the federation, as well as the volume of financial flows managed by the highest authorities, forms the consolidated budget of the Russian Federation.
Among the political institutions that perform a key linking function between financial management systems at different levels is the Federal Treasury. This executive authority, both at the highest level, and during the delegation of powers to the regions, performs the function of cash support for budget transfers, ensures the correct calculation of procedures related to the development of financing.
Center and regions
How do the powers of budget authorities at different levels relate? Before studying this aspect in the Russian context, we consider what models in the world exist within which a similar distribution occurs. And there are two of them. In the scientific community, they are called decentralized and cooperative.
Regarding the first - in it the federal budget plays the role mainly of the "second plan". Regional authorities have a fairly large independence in the formation of their own money management systems, collect the bulk of taxes (and in some cases have the right to set their own). The federal center does not actively intervene in regional budget processes. The concept of the state budget in countries where a decentralized system is practiced (Japan, USA) is usually associated with defense programs and the financing of infrastructure projects of national importance. The regional and municipal authorities are responsible for providing money for local social problems.
The main disadvantage of this system is that in the countries where it is used, there is practically no so-called “budget equalization” institution, in which assistance is provided to those regions and local communities experiencing income problems (usually from the federal center).
In the cooperative system, in turn, there is a noticeable centralization. The concept of budget in those countries where it is applied, as a rule, is associated with state capital at the level of higher authorities. In such systems, in turn, "budget alignment" is developed. Thus, regional and local structures, to a much lesser extent than under a decentralized system, take care of the efficiency of revenue collection (moreover, the norms included in the national budget law can set significant restrictions on that).
How to distribute authority?
In what cases does one or another state choose a decentralized model, and in which - a cooperative one? The first option, as a rule, is used in cases where the resource supply of the country's regions is approximately the same or comparable. The authorities can be sure that taxes per capita are paid approximately the same, citizens' incomes are also more or less equal. The cooperative model, on the contrary, is applied if the difference in the economic development of the regions is markedly expressed. The current stage of economic development in Russia is more suitable for applying this particular model.
But at the same time, the Russian budget law includes provisions that may indicate a sufficiently large independence of the regions regarding capital management policies. Let's consider this aspect in more detail.
Independence of budgets in the Russian Federation
The independence of budgets of various levels in the Russian Federation suggests that local authorities (in regions or municipalities) have a set of certain rights. And this despite the fact that the concept of the budget in Russia is almost always associated with the highest bodies of state power. What is the independence of the regions and municipalities in question?
First of all, this is the right to manage the budget, financial reserves that local authorities have independently. That is, the federal center has a limited resource for interfering in local decisions related to the financing of various projects. Also, budget financing by regions and municipalities can be carried out at the expense of own sources. And this is generally welcome. The ideal option is when a region or city can do without subsidies and subsidies.
Another important criterion for the independence of Russian budgets is the fact that they are adopted at each of the corresponding levels of political power separately. At the federal level, the government of the Russian Federation, the State Duma, the Federation Council are engaged in this, and the president of Russia is also involved. In the regions, they have their own legislative and executive bodies, as well as in the municipalities.
The next point, reflecting the independence of the levels of state cash flow management, legislative consolidation of the right to levy certain taxes. Also, regions and municipalities are empowered at their discretion to determine the revenue and expenditure items of the budget. Consider the aspect relating to those and others, a little more.
Budget revenues and expenses
How do budgets at each level generate revenue? Basically, these are various taxes and fees. What kind of municipality, region or federal power structure will be collected is determined by the legislator. Taxes and the budget are areas strongly interconnected. Expenditures, in turn, reflect the social orientation of the state’s financial policy, broadcast to the level of regions and municipalities (as well as the need to maintain key political institutions). In Russia, they are associated with cash security, mainly in such areas as:
- education;
- medicine and social security;
- defense;
- work of power structures;
- the functioning of power institutions.
An important nuance: pension provision is formally referred to as extrabudgetary policy. FIUs and numerous NPFs have their own financial reserves.
The cost structure that is characteristic of the Russian budget system may coincide with that in a number of other countries, but options are not ruled out when there will be plenty of differences. It all depends on whether the system of state financial management is practiced - decentralized or cooperative. In the first case, for example, such areas as medicine and education may be completely independent of the budget, they are private.
Fair budget: Russian scenario
Consider the most important, according to many experts, aspect of public financial management - that is the "budget alignment". By what mechanisms is it carried out in Russia? What help can regions and municipalities rely on if their main budget does not have a sufficient amount of income and costs remain relevant?
The main mechanisms in question will be such.
- Local budgets receive a certain percentage (there are standards defined by laws) from those taxes that should be sent to higher levels of the state financial mechanism.
- Grants from financial support funds - regional, district.
- Subsidies, subventions and subsidies from state financial institutions of other levels.
Imaginary Locality
Thus, the concept of local budget can be quite arbitrary. There are frequent cases when a particular region, city or small settlement, due to objective factors of a socio-economic or political nature, is predominantly subsidized. There may not be any funds of local origin in it at all. But at the same time, the local entity will still have a relative independence in the distribution of budget funds - we talked about what rights he has in this regard in this regard.
It is possible that local budgets receive a targeted subsidy. For example, it may be financing socially significant projects. In this case, it is important for the municipality, first of all, to guarantee the implementation of the relevant program in accordance with the standards adopted at the federal and regional levels.
