Russia's budget deficit expected to be 1.4-1.5 trln rubles in 2024 - Finance Minister Siluanov

MOSCOW. April 11 (Interfax) - Russia's Finance Ministry expects the federal budget deficit to be within 1.5 trillion rubles in 2024, which is within the framework of the plan.

The budget law stipulates a deficit of 1.595 trillion rubles, or 0.9% of GDP, for the current year. The budget was fulfilled at a deficit of around 600 billion rubles in January-March.

"The dynamics to fulfill the budget are better than in previous years. The budget deficit is currently expected to be 1.4-1.5 trillion rubles. The parameters for execution are within the framework of the planned expectations," Russian Finance Minister Anton Siluanov said in an interview with Interfax.

Advances, one factor behind the high deficit level at the beginning of last year, are more orderly this year, Siluanov said. "Advances in excess of 30% require justification. Control over these advances is necessary. This is the task of both the Finance Ministry and industry departments. If the money is in the account and is not used, then it is not being used effectively," Siluanov explained.

The level of advances for expenses in January was minimal, he said. "In February-March, spending became more active, but in general the situation is planned out, without surges," the minister said.

The Finance Ministry does not yet see any risks to the implementation of the income plan in 2024 (just over 35 trillion rubles at the end of the year). "The dynamics of macroeconomic parameters and the first results of budget execution as far as revenues are concerned allow us to say there are no significant risks in terms of revenues," Siluanov said.

He said that the budget law provides for an increase in revenues of 5.9 trillion rubles, or 20%, while a significant part of the increase should be provided by oil and gas revenues (+2.7 trillion rubles), based on the forecast dynamics of energy prices, the exchange rate and amendments to fuel and energy legislation. The application of the budget rule mitigates any potential risks in terms of oil and gas revenues, he said.

"Current expectations for the year confirm our previous forecasts," the minister said.

Despite the strengthening of secondary sanctions in 2023, oil and gas revenues are expected to be within plan, Siluanov said. "We are coordinating oil production and export volumes with OPEC countries," the minister said. Exporters have established supply chains, and current oil price levels "will make it possible to fulfill plans for oil and gas income, even taking discounts into account," he said.

The law provides for an increase in non-oil and gas revenues of 3.2 trillion rubles, including by means of one-time large transfers (in particular, the return from social funds of transfers associated with previously granted deferments on insurance premiums, and increased export duties on a wide range of products). The growth of this income is also associated with an increase in receipts of key tax payments, primarily VAT and other turnover taxes, which are estimated at about 1 trillion rubles in total, the minister said.

As for whether there are risks in fully implementing the borrowing program envisaged for 2024, the minister said, "We will implement it. The plans for the first quarter have been fulfilled, and we will continue to work, taking market sentiment into account."