Finance and Credit

Performance budgeting as a tool to nurture economic growth in Russia

Vol. 24, Iss. 5, MAY 2018

Received: 22 January 2018

Received in revised form: 12 February 2018

Accepted: 5 March 2018

Available online: 29 May 2018

Subject Heading: FISCAL SYSTEM

JEL Classification: G18, H30, H54, H61

Pages: 1211-1228

Masterov A.I. Financial University under Government of Russian Federation, Moscow, Russian Federation

Importance The article investigates performance budgeting as a tool for anti-recessionary boosting of the Russian economy. It shows how to improve the management of investment projects financed from the State budget.
Objectives The aims are to analyze key problems impeding further economic growth and explain the role of performance budgeting in the implementation of the government’s enabling policies.
Methods Using the methods of dynamic, factor, and systems analysis, I demonstrate the most urgent problems of the Russian economy. They may be solved, if enabling policies are applied by the State, using the result-oriented budgeting.
Results The paper unveils key problems, which hamper further development of the Russian economy, and shows the importance of State enabling policies to solve them. Under economic crisis and scarce budgetary resources, the role of result-based budgeting increases, when the government implements its supportive policies. I substantiate the need to improve investment planning and investment project management.
Conclusions and Relevance Factors underlying the current structural crisis include a high level of depreciation of fixed assets in key sectors of the economy. It affects adversely the productivity and competitiveness of Russian companies and, as a consequence, household incomes and effective demand. Under scarce budgetary resources and investment shortfall, the enabling State policies that are based on performance budgeting are crucial. The article includes recommendations on creating conditions for improving the efficiency of key investment project management.

Keywords: performance-based budgeting, State policy, enabling policy, investment project, efficiency


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