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How Much Do Officials Cost?

Crisis or not, the federal and regional authorities become increasingly more expensive. State machinery remains inefficient and unbelievably costly.

Cabinet meeting in Kislovodsk a couple of weeks ago discussed regional development. Premier Vladimir Putin reprimanded officials then. "What regional and municipal budgets set aside for the powers-that-be this year exceeds what they cost a year ago by 4%.This increase will amount to more than 25% in some regions! I trust you haven't forgotten that we have a crisis to fight," Putin said.

The premier said that maintenance of the regional administration in Magadan was 38% and in Ingushetia 30% more expensive than the year before. Maintenance of administrations in Belgorod, Murmansk, Bryansk, Moscow, and Altai was 25% more expensive this year.

"We intend to reduce the federal powers-that-be maintenance costs by 30% this year and 15% in 2010," Deputy Premier and Finance Minister Aleksei Kudrin announced.

"Do they now? That's a surprise," said Igor Nikolayev of FBK. "Results of the study "How Much Do Officials Costs?" we conducted paint a wholly different picture."

Federal power structures costs to the budget in the first half of 2009 showed a 37.9% rise.

"What else can we expect when the state machinery is so ponderous and inefficient?" Nikolayev said. "The so called administrative reforms carried out in the mid-2000s came down to banal reshuffling. There were 60 federal bodies and structures in the country at the onset of the reforms and nearly 100 when they ended."

Officials' salaries depend on position rather than efficiency of performance. Bureaucrats never care about the latter, focused as they are on lining their pockets while they are in the position to do so.

"The depth and seriousness of the crisis are underestimated and that, too, explains why the state machinery is so costly," Nikolayev said. "I remember officials telling us again and again last year that the crisis would only affect foreign countries. They kept raising their own maintenance costs meanwhile as though an extremely favorable situation in the global oil markets was going to last all through 2009."

FBK specialists say that federal officials cost 927 rubles and regional officials 711 rubles every Russian alive (from pensioners to newborns) in the first half of 2009. It follows that every Russian will spend 3,276 rubles on officialdom this year.

Regional budget expenditures (we are talking maintenance of the powers-that-be) increased 3.8% over the last twelve months.Unfortunately, this is an average figure. This increase amounted to 34.4% in Yakutia and 34.1% in the Nenetsk Autonomous District.

It is an infrequent Federation subject that did succeed in bringing the costs down - Bashkortostan (19.7%), Buryatia (16.9%), and Tatarstan (15%).

"It is fair to add that costs are reduced in the more or less prosperous regions," Nikolayev commented.

At the same time, the administration of the Novgorod region spent 33.9% more on itself than it had done before - and Novgorod could never boast of any financial stability worth mentioning. Little Chechnya - one of the poorest regions in the country - spent more than 1 billion rubles on its President Ramzan Kadyrov in 2009. All of the federal government in Moscow meanwhile cost the budget 1.3 billion rubles.

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