Consolidated budget of Vitebsk region for 2021 will maintain its social focus

The formation of the main development documents for the Vitebsk region in 2021 is influenced by the second wave of the coronavirus pandemic, which is putting pressure on the economy and, consequently, affecting the revenue of the regional treasury. In these circumstances, the need to ensure the stability of the local budget and enhance its social focus comes to the forefront, which will allow maintaining the course towards improving citizens' well-being.

This was discussed at a recent joint meeting of the standing commissions on local self-government and regulations, as well as social sphere, social protection of citizens, and youth affairs of the regional Council of Deputies. Together with the heads of the departments of the regional executive committee, the people's representatives analysed the results of the social sector's performance in 2020 and problematic issues to determine the budgetary possibilities for their resolution in 2021.

As noted by Svetlana Zubritskaya, Deputy Head of the Main Financial Department of the Regional Executive Committee, during the formation of the regional budget for 2021, requests were received suggesting an increase in its expenditures by more than 355 million rubles. Approximately 15% of this amount was managed to be provided for in the draft main financial document of the Vitebsk region; the remaining issues will be resolved as the budget is executed.

– Taking into account the tasks set for 2021, the formation of the revenue base of the regional treasury is projected to be very challenging. Significant funds are required to ensure, among other things, the current activities of the social sphere and other sectors financed from the budget, – noted Svetlana Zubritskaya. In these circumstances, it is important not only to initiate requests for additional funding but also to mobilise intellectual potential for the formation of additional revenue sources.

Priority areas of budget policy in 2021 regarding expenditures remain social protection of the population and improving citizens' well-being through increased wages. One of the main features of the 2021 budget is a significant increase in wage expenditures. If their share in the treasury's volume is currently about 46%, then for the next year this indicator will exceed 52%. Wage increases for public sector employees are planned to be implemented in two stages, taking into account the economy's achievement of target development scenario indicators. This implies receiving additional profit tax revenues, which will finance the growth in labor remuneration. Additionally, the consolidated budget provides funds for increasing wages for low-paid categories of employees in sectors such as education, culture, and social protection of the population.

The consolidated budget of the Vitebsk region for 2021 will maintain its social focus. Its expenditure part is projected at 2.478 billion rubles.

It is expected that over 1.7 billion rubles will be allocated to finance the social sphere. At the same time, the share of social expenditures in the total treasury volume will increase and will be around 70%. The most budget-intensive sectors will remain education (its share in budget expenditures will exceed 31%), healthcare (almost 27%), social policy (about 7%), physical culture, sports, culture, and media (about 5%). Overall, there is a certain deficit of resources in financing the social sphere, especially in terms of capital needs. However, expenditures by sector are planned considering the institutions' need for budget financing and are focused on facilities that have a high degree of readiness and are most significant for the region.

Despite the limited revenue base, local budgets are provided with resources to finance the most important expenditure areas, emphasized Svetlana Zubritskaya. Budget execution in 2021 will largely depend on the performance of the real sector of the economy. Positive economic development dynamics will allow for finding additional sources and addressing issues that were not reflected in the 2021 budget draft.

For example, as noted by Dmitry Khoma, Head of the Main Department for Education of the Regional Executive Committee, the preschool education system of the Vitebsk region, which is fully transitioning to new funding conditions, will require special attention in the coming year. Resource deficits are already being calculated today, and the possibilities for covering them are very limited. To this end, reserves will need to be sought within the general and secondary education system. According to Dmitry Khoma, another option – the optimization of the institution network – requires particular thoroughness and balanced decision-making. This is a categorical requirement of Nikolai Sherstnev, Chairman of the Regional Executive Committee.

Similar problems will need to be addressed in the social protection system, where approximately 3 million rubles need to be raised solely for the additional support of territorial centers for social services for the population. Even in healthcare, for which expenditures are planned at around 660 million rubles, financial issues remain open in a number of aspects.

Among other main areas of budget financing, 140 million rubles are planned for capital expenditures, including over 50 million rubles transferred from the republican budget for specific purposes. At the same time, an increase in capital investments is not planned, as there are no significant grounds for this. Support for sectors of the national economy is projected to receive 182 million rubles, or 7% of the budget expenditures. Approximately 56% of this is allocated to the agro-industrial complex, 22% will go to financing the transport sector, and about another 10% to road management organizations.

Overall, the consolidated budget of the Vitebsk region is formed with a surplus of 72 million rubles.

In the absence of sources for a significant increase in expenditures in 2021, the balance of local budgets has been ensured within the available resources, taking into account measures for optimizing and saving expenses, noted Svetlana Zubritskaya. Furthermore, it is intended to maintain the approaches to tax distribution and the operation of other budget rules, which makes the revenue base of the treasury predictable. Only in this way can the stability of local budgets at all levels be ensured, which directly affects the quality of regional development.