Budget of Kazan to be deficit in 2021 — the city to have to find another 2.4bn rub for spending

Environment in Kazan was underfunded by 30% due to quarantine last April

Chairperson of the Control and Accounting Chamber of Kazan Ilnar Nurgaliyev at the session of the Kazan City Duma spoke about which areas and industries were most affected by the covid 2020 year. It turned out that the implementation of the budget for environmental protection of the capital of Tatarstan was only two-thirds of the plan, or 64,7%, only 86,6% of the planned budget was spent on housing and communal services, and 87,2% — on social policy. At the same time, in the field of social policy, the budget expenditures of Kazan in 2020 amounted to 1,2 billion rubles: these funds were used to ensure the transportation of privileged categories of citizens in public transport, the organisation of hot meals for certain categories of schoolchildren, compensation for parental fees for kindergartens and other areas.

Bulat Kutdusov, the chairperson of the standing committee on budgetary and financial issues of the Kazan City Duma, noted that Kazan in 2020 in the budget sense suffered primarily in the second quarter, when the city lost almost 1 billion rubles in revenue (more precisely, 930 million rubles), or 23%. It was possible to recover the losses only in the fourth quarter, when the budget received 20% more money than in the same period a year earlier (6,2 billion rubles against 5,2 billion).

At the same time, Kazan could not spend more than 800 million rubles

According to the head of Financial Department of the City Executive Committee Irek Mukhametshin, the volume of budget expenditures in 2020 amounted to 28 billion 166 million rubles, which is by 3% (or 741 million rubles) higher than in 2019. And 72,8% of the total expenditure (20 billion 495 million rubles) was in the social sphere. According to Mukhametshin, with the approved budget of 24,9 billion rubles, the implementation amounted to 29 billion rubles. There were also additional revenues to the city budget — about 4 billion rubles. This is indeed more than in 2018 and 2019, when the budget of the capital of the Republic of Tatarstan was 21,6 billion and 23 billion rubles, respectively. According to dry statistics, the budget surplus last year amounted to 885,2 million rubles (with revenues of 29 billion rubles — only 28,16 billion were spent).

One can't explain the growth of transfers from the republican budget only by “quarantine spending” — Kazan received 12,6 billion rubles from the republic last year, which is by 1,2 billion rubles more than the amount of 2019. Irek Mukhametshin assures that the growth of republican support is primarily due to a positive demographic situation and an increase in the number of kindergarten students and schoolchildren: “As long as the number of students in kindergartens and schools is increasing, the number of new kindergartens and schools will grow, and budget expenditures for their maintenance will increase accordingly.” Spending on education, by the way, last year accounted for the lion's share — 16,5 billion, which is by 6% more than in 2019. Over five years, the budget of the educational sphere of Kazan has grown by 33,8% (also due to the growth in the number of students and the construction of schools).

The main revenues to the Kazan budget last year directly depended on the income of the Kazan residents themselves (or personal income tax), the share of which was 36% — the city treasury received 6 billion rubles of this tax. In addition, Kazan was fuelled by a land tax of 3,5 billion rubles and a tax on total income of 2,7 billion rubles. The main part of non-tax income in 2020 was mainly generated by the sale and use of property (1,5 billion rubles). The volume of budget expenditures for 2020 amounted to 28,1 billion rubles, which is by 3% (741 million rubles) higher than in 2019. 72,8% of the total expenditure (20,5 billion) was in the social sphere. Expenditures on urban economy amounted to 4,7 billion rubles. Landscaping accounted for a large share (3 billion, of which 1,7 billion rubles were spent only on road infrastructure), transport (590 million), housing (531,6 million).

But in 2021, the Kazan budget will be deficit

Under-implementation of the budget for labour protection, housing and communal services and social policy led, among other things, to that at the end of 2020 the city's budget surplus amounted to 885,2 million rubles. Such a large amount of surplus was obtained for the first time, the authorities of Kazan noted and attributed it to the unstable economic situation. “In the second quarter, we were forced to significantly optimise costs, by the fourth quarter, the situation improved," explains Mukhametshin.

A sharp budget bias is also evident in 2021: if last year turned out to be surplus, because environmental protection and social policy were underfunded, then this year will be deficit. The budget deficit for 2021 has increased by 1,3 billion rubles today, despite additional revenues from the republic by half a billion and unspent budget funds for the past year. Revenues have increased by 712,6 million rubles, amounting to 28,7 billion rubles. Expenses, however, increased by 2 billion rubles, amounting to 31,1 billion rubles, and not 29,1 billion rubles, as previously.

Thus, deficit will amount to 1,2 billion rubles. Most of the additional expenses will be spent on citywide events — 148,2 million, the implementation of the May Decrees of Russian President Vladimir Putin — 133,2 million, as well as on construction, architecture and housing — 115,3 million. An additional deficit of 1,3 billion rubles will be caused this year mainly by the maintenance of municipal institutions, which will require 820,4 million rubles, which is still unknown where to get, and the need for major repairs and construction of the same buildings of institutions — another 304,5 million rubles.

To somehow compensate for the deficit, the deputies of the Kazan City Dume included in the privatisation plan for this year additional 15 objects — a total area of 2,300 square metres.

As part of the Voznesensky Tract construction project, 6 schools and 14 kindergartens will be built in the Sovetsky District

Finally, at the end of the session of the Kazan City Duma, the deputies discussed the project of planning the territory of the Sovetsky district and surveying it within the borders of Rodina, Daurskaya, Gvardeyskaya and Adel Kutuya streets — a total area of 48,000 square metres, or 4,8 hectares. The developer of Capital Estate Specialised Developer PLC asked to transfer the land plots in this territory from the category of “communal and warehouse zone” to the public service zone, for multi-storey and medium-rise residential development. Previously, this area belonged to the “multifunctional public business zone”.

According to the plans of Kazan, this area provides for the formation of residential areas, where six schools and 14 kindergartens are planned. This project is connected with another large-scale project — the construction of the new Voznesensky Tract. Let us remind that the highway is going to be built in the Sovetsky district on the site from the Gvardeyaskaya Street to Pobedy Prospekt “to provide the transport infrastructure of residents and territories of the city”.

The highway is expected to take the traffic flow from the city to M7, unloading Pobedy Prospekt, Mamadyshsky Tract, Orenburg Tract. Apparently, in the light of criticism of developers by the republican authorities, in particular from President of Tatarstan Rustam Minnikhanov, regarding that builders rent out residential complexes without any social infrastructure, the deputies had a fair question. The commissioning of each residential complex in the capital of the Republic of Tatarstan is possible only after the completion of the construction of a kindergarten — however, in the project, the people's deputies did not find a link between the commissioning of the object and the construction of a school and a polyclinic. The Kazan authorities assured that all 6 schools and 14 kindergartens will be introduced in stages: the developer will not be able to put the entire complex into operation until social facilities are built.