Russian oligarchs’ 'voluntary' donations of 471 billion rubles bolstered the state budget

Voluntary-looking donations from Russia’s wealthiest individuals have already covered more than 1 percent of the state’s total expenditures this year, official budget documents show. Recorded in the accounts as "voluntary revenues," the inflows total 471 billion rubles — more than $5.6 billion — and have prevented the budget deficit from rising to 3.4 percent of gross domestic product.

Thanks to that cash, the deficit is now expected to amount to 3.2 percent of GDP, or 7.3 trillion rubles, according to the same budget papers — still roughly double the government’s original target of 1.6 percent.

How the payments were arranged

The extraordinary top-up was reportedly arranged at a closed-door meeting President Vladimir Putin held in March with leading Russian businessmen, many of whom are subject to Western sanctions. The Kremlin said the idea was floated by an unnamed businessman who argued that property-rich Russians had built their fortunes in the 1990s thanks to ties with the state and therefore had a duty to contribute to the budget.

At the meeting one participant offered a very large sum, which Putin immediately welcomed, and the president later in September disclosed “that hundreds of billions of rubles had been donated” after that gathering.

The transfers have been entered into the state accounts as voluntary receipts and lawmakers and budget officials cite them as the reason the shortfall is smaller than it would otherwise have been. The scale — several hundred billion rubles — underlines how informal mobilization of private cash has been used this year to blunt the fiscal impact of other pressures on public finances.

Budget documents present the 471 billion-ruble figure as the cumulative total so far; officials have contrasted the resulting 3.2 percent deficit with the government’s earlier 1.6 percent target to illustrate the remaining gap the budget still faces.

Photo: DPA)