Russia’s spending on the war in Ukraine reached 30 billion rubles a day

The expenditure of the Russian budget to finance the army thrown into the war with Ukraine exceeded 3 trillion rubles in early May. Janis Kluge, a researcher at the German Institute for International Security Problems, makes this assessment with reference to data from the Electronic Budget system.

According to the Ministry of Finance, as of May 15, the budget spent 789.8 billion rubles on open positions in the “national defense” section alone. To this amount, we must add another secret expenditure – 3 trillion rubles, of which 80% (2.4 trillion rubles) goes to the military – points out Kluge.

Thus, on average, each month of hostilities costs the budget about 720 billion rubles. These are two annual budgets of rich regions, such as the Yamalo-Nenets or Khanty-Man Autonomous Okrug (330 billion rubles), or eight annual budgets of poor regions, such as the Bryansk and Vladimir regions (90 billion rubles).

Every day, the military machine “eats” about 30 billion rubles – an amount comparable to what the poorest regions collect into the treasury in a year. For example, the income of the Jewish Autonomous Oblast in 2023 was set at 19.3 billion rubles, Kalmykia – 24.9 billion rubles, Ingushetia – 35.9 billion rubles.

In the 2023 budget, the Ministry of Finance provided for 5 trillion rubles in the “national defense” item, and by mid-May it had already spent two-thirds of this amount, Kluge points out. Military spending was three times the amount allocated to support the national economy and six times the amount allocated to education and health from the federal treasury.

In January and February, injections for the army and defense plants, which were ordered to sharply increase the production of shells and shells for tanks, reached almost 1 trillion rubles a month, according to data from the Ministry of Finance (the ministry published the full amounts, including “closed” items, only for two months of 2023). Compared to the same months in 2022, when the army stood on the border with Ukraine and prepared to invade, and Russian officials denied plans to start a war, defense spending increased by 282%.

Part of the expenses are advance payments to enterprises of the military-industrial complex, which President Vladimir Putin demanded to produce more weapons and urgently improve their characteristics.

– We do not have any financial limitations – he promised at the end of December at the Ministry of National Defense meeting. As a result: the budget is rapidly increasing spending, and the revenue situation is deteriorating – rivers of commodity rent have become shallower due to sanctions and gas cuts for European countries, and non-oil and gas revenues are falling in the face of economic recession.

According to the Ministry of Finance, in the period January-April, oil and gas tax revenues halved, total revenues fell by 22%, and the deficit reached 3.4 trillion rubles, exceeding the plan for the whole year.

At the same time, in April alone, the size of the “hole” in the treasury exceeded 1 trillion rubles, and the drop in revenues from oil and gas accelerated to 64% after 43-46% in January-March.