A comprehensive assessment of the aggregate fiscal sustainability of subnational heavily subsidized budgets

Abstract

Subject. This article tests the author-developed methodology for assessing the level of aggregate fiscal sustainability of high-subsidized budgets at the subnational level of Russia. Objectives. The article aims to determine the level of aggregate fiscal sustainability and stability of high-subsidized budgets at the subnational level of Russia and identify the features of such sustainability in the process of functioning of the mechanism of inter-budgetary regulation and fiscal equalization. Methods. For the study, I used the methods of time series, comparison and collation, grouping, logical generalization, and the ratio analysis. Results. The article presents a rating of stability of high-subsidized budgets of the subjects of Russia, compiled on the basis of an assessment of the aggregate budgetary stability of five groups of indicators. The article also reveals the systematic verticalization and centralization of the system of inter-budgetary regulation in relation to high-subsidized regions. Conclusions and Relevance. Applying the methodology of comprehensive assessment of the sustainability of high-subsidized budgets made it possible to identify the problematic aspects of the budgetary state of regional finances. This can be used by the executive authorities, namely the financial ones, in order to analyze the state of the subnational budgets of the country's budget system. Also, this technique can be used in determining the volume of inter-budgetary transfers to equalize the budget provision in relation to the high-subsidized budgets of the regions of Russia. This can help increase the level of per capita budgeting of depressed subjects of the country.