This material represents the economical part of the report of the project "Technical assistance to the Taimyr autonomous okrug in reforming of interbudget connections" (executors – P. Orekhovsky, D. Slesarev). The project was conducted as a part of UK Department for International Development program of technical assistance to Russian Federation in regional finance reform.
Numerous budgetary novations in federal legislation approved in 2003-2004 concern the Taimyr autonomous okrug directly. In 2005 the okrug has to pass a law about the Fund of financial aid to municipalities and to use single principles in providing financial aid to municipalities. This should allow to realize federal purposes to regulate budgetary process and finally to achieve increase of budgetary expenditures efficiency.
Differences between Taimyr municipalities in proper revenues are caused with territorial labour allocation and state of cities’ economy. Administrative equalization of municipalities’ revenues is a necessary condition of providing budgetary services assured by the Constitution of the Russian Federation to the people. Current financial state of municipalities doesn’t allow to solve this task properly.
The main objective of this project is elaboration of the method of Taimyr municipalities’ revenues equalization.
During the project following methods were elaborated:
- The method of calculation of size of regional fund of financial aid to municipalities.
- Two methods of distribution of transfers from the fund:
- The method based on the calculation of general rise of prices of main budgetary services,
- The method based on the calculation of the number of conditional consumers of budgetary services.
In order to choose the best one, both methods of distribution of transfers were approved using actual data of municipal budgets in 2003-2004. Comparison of indexes of budgetary revenues per capita and the structure of municipal budgets’ expenditures before and after granting transfers to municipalities was accomplished.
Based on the recommended methods following figures were forecasted and calculated for 2005:
- the size of regional fund of financial aid to municipalities,
- indexes of budgetary revenues per capita of each municipality,
- amounts of transfers from the fund to each municipality.