Russia's finance ministry has proposed expenditure cuts to its 2024 budget, the Vedomosti daily reported on Tuesday, citing two sources close to the government, a step that would free up funds to spend on areas such as the military and national security.
Faced with a January-May budget hole of $42 billion Russian officials have acknowledged the need to rein in the deficit, agreeing at an economic forum last month that some spending cuts would be inevitable, while viewing increased domestic borrowing or higher taxes as less appealing alternatives.
As sanctions shrink energy revenues and spending soars to fund fighting in Ukraine, the budget deficit is already 17% above the plan for the whole of 2023.
Vedomosti reported that Finance Minister Anton Siluanov proposed cutting so-called 'unprotected' spending by 10% for 2024 at a June 29 meeting.
Russia's draft budget for next year envisages total expenditure at 29.43 trillion roubles ($327 billion). Unprotected spending excludes items that are deemed direct spending orders made by the president and government, which include social spending on veterans and families with children.
Russia stopped publishing up-to-date sector-specific budget expenditure data in recent months, cutting access to one of the few remaining tools for gaining detailed insight into the country's fiscal health.
Spending on defence leapt 282% in January-February alone, data showed in May, the last time it was published. ($1 = 89.8650 roubles) (Reporting by Darya Korsunskaya, Alexander Marrow Editing by Peter Graff)