Regional budget: untrue optimization

Six years now the Vologda Oblast has been facing the budget crisis at full speed. On the one hand, it is caused by the considerable reduction of economic growth and relevant shortfalls of tax payments; on the other hand it is generated by the necessity in executing tasks of the country’s socio-economic development set by the President of the Russian Federation, financing of which consumes almost all earned revenues.Since 2009 stability indicators of the regional budget has been worse than average in Russia. The region is a large-scale promisor of banks, however annually it is forced to obtain more and more credits, but not on investments, which could provide payback, but on previous debt servicing and financing of current expenditures. According to results of 2013 the Vologda Oblast became one of the seven regions of the Russian Federation, where the amount of public debt exceeded its own revenues.Under the circumstances, the regional authorities carry out the policy of tough financial consolidation, accompanied by sequester of not only investment, but social expenditures. Meanwhile, detailed analysis of expenditure part of the regional budget revealed that budget manoeuvres resolved into increasing of expenditures on executive personnel and maintaining unreasoned privileges for it.The article presents the results of the regional budget analysis of the Vologda Oblast in 2013. The author makes alternative suggestions in optimization of budget expenditures.