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National Interests: Priorities and Security
 

Budget programming as a method of realization of Russian economy development strategy

Vol. 10, Iss. 36, SEPTEMBER 2014

Available online: 23 September 2014

Subject Heading: STRATEGY OF ECONOMIC ADVANCEMENT

JEL Classification: 

Pages: 2-13

Ustyuzhanina E.V. Plekhanov Russian University of Economics, Moscow, Russian Federation
dba-guu@yandex.ru

Evsyukov S.G. Central Economics and Mathematics Institute, RAS, Moscow, Russian Federation
sg-7777@yandex.ru

Panfilov F.A. Ministry of Economic Development of Russia, Moscow, Russian Federation
panfilovfa@mail.ru

Importance The article analyzes the use of budget programming techniques for budget management. The research subject is the formation and implementation of the State budget program.
     Objectives We aim to reveal the main problems of contemporary budget programming and to make recommendations for improvement of the budget process.
     Methods The research methods include a systems analysis and comparative analysis. Based on the analysis of the practice of formation and realization of the Federal Target Programs of Russia, we reveal the common errors, which are intrinsic to the contemporary budget programming. These errors include: the lack of a systematic approach to planning; incorrect ways of purpose setting and decomposition; the use of incorrect methods of justification of return on investment. The unsystematic approach to planning leads to duplication of purposes, tasks and activities of different target programs as well as the resource orientation of many projects (retooling of production without analysis of sales opportunities) and the imbalance of its supporting subsystems. The defects of goal-setting display themselves in weak linking the objectives with the possibilities, orientation on forming (demonstrating efforts), and not the result (which characterize the achievements) of the indicators with the respect of performance targets, which are measured in monetary terms, inaccuracies of formulation of target indicators, which allow to interpret the results differently. The methods to justify the cost, with rare exceptions, suffer from the multiple errors, particularly in the ways of calculating cost-effectiveness in view of the time factor.
     Results We explain the need to develop a general method of budget programming. This method should be based on the OEСD recommendations, program-oriented and goal-oriented approach to planning and control as well as scientific methods of investment project evaluation. We make the specific recommendations for improvement of budget programming tools.
     Application The research results can be used for preparation of study courses in budget programming.

Keywords: budget, budget programming, State programs, Federal Target Programs, special-purpose program management, target planning, investment projects pay-off estimate

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