The state budget depends entirely on transfers from the Oil Fund, an expert

Baku / 07.12.17 / Turan: The head of the Public Association for Assistance to Economic Initiatives Azer Mehdiyev does not agree with the opinion of the government representatives on the social orientation of the state budget of 2018. In an interview with the "Cetin Sual" program ("Difficult Question"), he noted that in the 2018 budget there is no serious increase in spending on the social sphere. The increase relates more to spending on investment, housing and communal services, agriculture, communications and transport. Against this backdrop, education costs remain almost unchanged.

In the health sector there is a slight, but a decline. The same goes for social protection and social security. Increasing the funds for investment in itself is a positive development, as this lays the foundation for sustainable development. However, in recent years investments in Azerbaijan have been invested in bloated projects, for repetitive work, for example, repair of newly constructed roads, facing of buildings.

Perhaps socially oriented consider investing in the construction of social housing. However, no increase in salaries and pensions is expected. Referring to the sources of the budget, the expert pointed out the preservation of its dependence on the oil industry. The budget revenues will increase by 20% in comparison with the budget-2017. However, this increase will be ensured by transfers from the state oil fund.

If to take into account that in 2016 transfers from the Oil Fund to the state budget amounted to 6.1 billion manat, and next year they are projected at the level of 9.2 billion manat, the increase will be 51%, despite the fact that when discussing the budget in 2017, it was stated that from now on transfers from the oil fund will decline annually.

In general, in the budget of 2018 the share of transfers from the oil fund reaches 48%. In general, 55% of revenues are generated from the oil sector and only 45% from the non-oil sector. Among the companies that provide 45% of revenues, many companies serving the oil industry. As for the forecasts of the growth of non-oil revenues, they will be mainly increased by increasing duties and penalties.

He also pointed to the non-transparency of the budget process, which is not previously held public discussions. On the other hand, about 30% of budget A expenditures are not disclosed to the public. As long as there is no framework for medium-term expenditure, there is no budget designed for concrete results, it will be difficult to talk about transparency of the state budget, Mehdiyev said.-03B06--