President Vladimir Putin has outlined his vision of the country’s budget strategy for 2008–2010 in a budget policy document sent to the parliament and Government.
Medium-term budget strategy should facilitate the country’s social and economic development while at the same time keeping strictly to the principles of efficient and result-producing state spending, the document said.
One of the main areas the Government should focus on in drawing up and implementing its budget strategy is ensuring a balanced budget over the long term. As the need to sterilise excess money supply in order to stabilise macroeconomic indicators lessens, it will become more important to ensure that budget expenditure is sustainable regardless of world commodities prices.
It is with this aim in mind that the Government’s Stabilisation Fund should be transformed into a Reserve Fund and Fund for Future Generations, the policy document said.
The Reserve Fund’s purpose would be to maintain budget expenditure even if oil prices were to fall considerably in the medium term.
Revenue collected from the oil and gas sector in excess of the money paid into the Reserve Fund and the money used directly to finance federal budget expenditure would be placed in the Fund for Future Generations.