Deputy Minister Of Finance Comments On 2002 Draft Budget

First Deputy Minister of Finance Sergei Ignatyev has told parliament deputies what distinguishes the 2002 draft budget from the budgets of previous years. Ignatyev was speaking at a Tuesday meeting of the Budget Subcommittee of the State Duma (the lower house of the Russian parliament), which has begun preparations for the first reading of the government-proposed budget. According to Ignatyev, the budget income has been estimated on the basis of a favourable forecast for world fuel prices: oil - $23.5 per barrel, and gas - $98 per 1,000 cubic metres. Ignatyev noted that the estimates of the 2001 budget income had been based on an oil price of $21.5 per barrel. Actually, he said, over the first eight months of this year oil prices reached $24.5 per barrel. Ignatyev said that for the first time in recent years the government plans a budget surplus, which he said is required to pay foreign debts and interest on them on schedule. Next year, Russia does not plan to negotiate any large loans from other countries. The main distinguishing feature of the 2002 draft budget is the creation of a financial reserve, Ignatyev said. He added that the reserve is required to avoid problems in 2003 when Russia is to make the bulk of its foreign debt payments, approximately $19 billion, or if world oil and gas prices change. The deputy minister pointed to the social orientation of the budget which provides for a marked increase in salaries in the public sector, and to the budget's orientation to social, military and judicial reforms.

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