Page 9 - RUSRptSept18

Stepashin, who also ran the state auditing body before disappearing into obscurity, the previous head of the institution was Tatyana Golikova , who was nominated for the Deputy PM for social policy in the new government – one of the most important posts that will oversee a large part of the new spending under Putin’s May Decrees spending extravaganza. But its all a work in progress.
Previous reports claimed that the Audit Chamber will be given carte blanche to inspect regional spending and even to scrutinise the Central Bank of Russia , adding to the speculation that Kremlin sees the institution becoming a key watchdog under Kudrin , clearing the path for efficient spending of Putin's RUB8 trillion development drive.
Kudrin noted that Chamber's anti-corruption mandate is almost not codified, while he will seek to legally pin the anti-corruption status to the institution that can mobilise its access to state information and accounting systems.
Curbing corruption is the most important of the four goals Kudrin set for his office , along with tying Russia's strategic development goals to the actual budget, enhancing the methods of budgetary control, and informing the public on realisation of national strategic goals.
More recently Kudrin floated the idea that the Russian government could see a third of state officials and bureaucrats sacked by 2024 thanks to digital technology.
2.3 Russian growth stymied by crisis in confidence
Russia’s economy is doing fairly well but what is holding it back from faster growth is a crisis of confidence amongst its businessmen : corruption and red tape are problems, but it is the increasingly predatory nature of the state-owned enterprises that make some businessmen wary of taking the kind of risks needed to fuel faster growth. The default attitude is to make certain of your existing business and not stick your head above the parapet.
The Rosstat Business Confidence survey shows an aggregate improvement over the last two years as the economic recovery gets underway. The index has risen from a low of -5 index points in December 2017 to -2 in March where it has remained since then. The index averaged -3.23 from 2005 until 2018, reaching an all time high of 7 index points in the midst of the boom years in July of 2007 but then fell to a record low of -20 in December of 2008 during the global crash.
However, small businesses are more vulnerable and this is also the sector from where Russia’s growth should be coming from.
The sentiment index for small business measured by Alfa-Bank has fallen hard recently to -27 index points – on a par with its level of November 2016 in the midst of the “silent crisis.” The all time low for this index was set in November 2015 when Alfa’s SME confidence index fell to -38 index points.
This plunge in confidence is mirrored in the last industrial production and IHS Markit Russia Manufacturing Purchasing Managers (PMI) indices, which have also both been falling in the last three months, despite the rising incomes and moderate economic growth.
Most SMEs expect a deterioration in the economic situation in the country and predict a decline in the purchasing power of the population, Alfa Bank explains. The worries are prompted by the government’s recent decision to hike VAT from 18% to 20% -- the first time the government of president Vladimir Putin
9 RUSSIA Country Report September 2018 www.intellinews.com