Regions have inefficiently spent budget loans on infrastructure

A number of regions have not achieved their goals in projects that they finance with infrastructure budget loans. In particular, revenue plans from the launch of such projects have not been fulfilled in 32 regions, according to the July report of the Accounting Chamber (JV) on the effectiveness of spending on regional development (available from Izvestia).

Sorry, goodbye: debts were written off to three Russian regions

How the federal center helps the subjects of the federation

The control department told Izvestia that over the past four years they have been allocated loans worth 365 billion rubles. Among the subjects with the lowest level of revenues to the treasury are the Novosibirsk, Jewish Autonomous, Astrakhan and Saratov Regions, as well as the Republic of Buryatia.

Also, out of 68 regions where housing has been planned over the past four years, 45 of them turned out to be below expectations. At the same time, ten of them have not commissioned a single square meter in several years.

If the regions do not achieve the stated results, the risk increases that they will not be able to repay infrastructure loans and interest on time, warns the joint venture. This can have a negative impact on the entire budget system. In addition, delays and postponements of completion dates lead to an increase in the cost of construction.

One of the reasons for the failure of the terms of the contracts was that most of the projects with infrastructure loans were launched in 2022 — against the background of sanctions pressure and a sharp increase in prices for building materials, said Dmitry Zemlyansky, an expert at the Presidential Academy. Also, due to the rise in the cost of materials and labor, operating costs have increased, said economist Andrei Barkhota. As a result, the amounts included in the estimates were not enough, the projects went beyond the budget and began to shift in time. He also committed possible financial abuses.