Russia classified quarter of 2023 expenditures amid war

OLENA ROSHCHINA — THURSDAY, 13 OCTOBER 2022, 01:13

The Russian government has classified a quarter of all expenditures for 2023. The media believe that RUB 6.5 trillion might have been allocated to fund the war and the annexation of Ukrainian territories.

Source: Meduza [Latvia-based Russian media outlet]

Details: Meduza journalists believe that the answer to the question of how Moscow intends to finance the war and maintain the annexed Ukrainian territories lies in the classified part of the federal budget of the Russian Federation for 2023.

On September 28, the Government of the Russian Federation submitted to the State Duma the draft federal budget for 2023 and for the prospected period of 2024-2025.

Meduza suggests that the Russian authorities have decided to classify unprecedented expenditures, namely over RUB 6.5 trillion.

A significant part of the expenditures are allocated to the purposes listed in military articles, specifically national defence and security; however, it has not been revealed to what almost a quarter of Russia's planned expenditures next year have been allocated.

Classified expenditures will increase in 2023 by over RUB 2.8 trillion.

Russian Minister of Finance, Anton Siluanov, confirmed on 3 October that resources designated for the restoration of the occupied Donetsk, Luhansk, Kherson, and Zaporizhzhia oblasts of Ukraine have been included in the budget since the Kremlin labelled them the territory of the Russian Federation.

Earlier, the minister had confirmed that the Russian government does not intend to disclose the volume of expenditures for the war, which Moscow deceitfully calls a "special military operation."

However, the classified part of the expenditures of the Russian draft federal budget for the next year is unprecedentedly large.

According to the calculations of Meduza (which match estimates by Bloomberg and Vedomosti, a Moscow-based business newspaper), secret and top-secret items of expenditure will account for RUB 6.58 trillion in 2023, or 22.66% of all expenditures of the federal budget.

This is RUB 2.8 trillion more than in the 2022 budget when the share of classified expenditures was less than 16%. The Russian classified expenditures similarly peaked in 2015 (21%).

Not all sections and subsections of the 2023 draft budget are split into open and classified parts: some sections remain completely open, e.g. "Functioning of the President of the Russian Federation", while some are entirely classified, such as "Nuclear Weapons Complex".

The classified expenditures designated for national defence and security purposes will increase dramatically in 2023.

The classified part of expenditures on national defence in the Russian draft budget for 2023 increased by RUB 1.36 trillion, and its share in total expenditures in this section increased from 65% to 73%.

Such a change happened, primarily, due to a sharp increase in classified expenditures in the section "Other issues in the field of national defence" from RUB 295.7 million in 2022 to RUB 1.77 trillion in 2023.

Meanwhile many other classified expenditure items in this section have decreased even in nominal terms (not factoring in inflation). For example, classified expenses for the "Armed Forces of the Russian Federation" decreased from RUB 1.53 trillion in 2022 to RUB 1.42 trillion in 2023.

The classified expenditures for national security and law enforcement activities have also increased significantly: from RUB 1.18 trillion in 2022 to RUB 2.61 trillion in 2023. The growth occurred primarily in the section "Other issues in the field of national security and law enforcement activities". The classified part of this section was expanded from RUB 478.4 million to RUB 1.87 trillion.

Classified expenditures in other sections of the draft budget remained essentially without significant changes.

The expenditures included in the draft budget of the Russian Federation may still increase or decrease. Russians will be able to find out the exact amount of expenditures for the next year only in 2024 when the law on the implementation of the budget for 2023 will be adopted.

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