At the end of 2016, the Vologda Oblast approved its budget for 2017–2019. At first glance, its parameters are quite optimistic if we recall that from 2009 to 2015 the budget was significantly unbalanced. The planned annual surplus of 2.5 billion rubles is planned in the upcoming budget cycle. The budget surplus exceeding this sum was registered only in 2004. These projections are not based on the expected sustained economic growth, but on the terms of agreements with the Ministry of Finance of the Russian Federation on the allocation of financial assistance to the oblast in the form of budget loans. The forecast of socio-economic development elaborated by the Vologda Oblast Government retains low growth rates of all macroeconomic indicators; due to this fact it is unlikely that sufficient financial resources could be generated: the average annual growth rate of the budget’s own revenues will not reach even 4%. The positive balance of the treasury is expected to be reached with the help of fiscal consolidation: the amount of government spending as a share of gross regional product will decrease to 9% to 2020 against 13% on average over the period of 2005–2016. As for the sphere of debt policy, the forthcoming three-year period raises quite a few critical issues compared to previous years. The oblast will need to return 55 billion rubles of loans. In the conditions when the budget’s own funds are growing slowly, the regional authorities are most likely to resort to new borrowings in the form of expensive commercial loans, because due to a high imbalance of the federal budget, Russian Government reduces the provision of cheap budget loans to the regions. The paper presents the results of the analysis of the Law on the Vologda Oblast budget for 2017–2019, the main purpose of which was to identify priorities of budgetary policy. Our study reveals the defects of the current system of budget planning, as well as the results of the analysis of a traditional approach to forecasting budget revenues and expenditures according to the indicators set out by the RF Ministry of Finance, rather than an approach to substantive issues of economic growth. It is shown that in modern conditions this method does not allow regional government authorities to forecast accurately and plan the revenues and expenditures of their budgets, and to ensure their balance. The study shows the dependence of the quality of budget planning upon a system of macroeconomic indicators such as gross domestic product, investments in fixed capital, inflation and monetary incomes of the population. The main conclusion of the study is that the three-year budget primarily reflects the achievement of simulated stabilization. In our opinion, the objectives of fiscal policy when forming regional budgets should be set out under the active influence on territorial development. But this requires the implementation of internal reserves of increasing the revenue potential of the regions. The present paper marks the initial steps in this direction
Keywords
regional budget, economic growth, debt burden, loans, budget planning, intergovernmental fiscal policy, surplus