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National Interests: Priorities and Security
 

Improving the performance-based planning methodology in the military and financial sectors

Vol. 11, Iss. 23, JUNE 2015

PDF  Article PDF Version

Available online: 24 June 2015

Subject Heading: Priorities of Russia

JEL Classification: 

Pages: 2-14

Vikulov S.F. Academy of Military Economics and Finance, Moscow, Russian Federation
Sergviculov@yandex.ru

Khrustalev E.Yu. Central Economics and Mathematics Institute of Russian Academy of Sciences, Moscow, Russian Federation
stalev@cemi.rssi.ru

Importance The recent years have demonstrated that the market is not very efficient in encouraging and stimulating R&D and innovative progress of the Russian industrial production. In this respect, it is especially relevant to consider issues of intensive development of high-tech and science-based sectors of the national economy. Robust tools are needed to effectively manage processes of making new military products and working out promising development plans.
     Objectives This article solves several important financial and economic problems related to resource allocation for construction problems of the Russian military forces by type of forces and other budget managers of the Russian Ministry of Defense.
     Methods The proposed methodological approach consists of determining the main direction for a budgetary reform. It should facilitate switching to the performance-based budgetary planning method that allows for direct connection between budget resources allocation and actual or planned results of their use in line with the State policy priorities.
     Results The results of the research will allow for reasonable planning of the defense and industrial sector development and the entire organization of the military sector. We determine what military products the nation needs and forecast trends in the military and technological situation.
     Conclusions and Relevance The performance-based method for planning the military budget sets its strict correlation with the planning system of the Russian Ministry of Defence, creates a respective financial tool to manage and control the way the construction and development plans of the Russian Armed Forces are implemented, and concurrently to stimulate their provisioning. It also refers to other forces and authorities. The results of the research will be useful for military planning purposes, determining the procedure and methods to achieve objectives and tasks of the military sector development, construction and progress of the Russian Armed Forces, other authorities, and for applying the proposed tools and their comprehensive support.

Keywords: planning, performance-based approach, military economics, finance, national security, military products, military forces, indicative control, armament program

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