Annex 9:

9PR: Elaboration of Propositions for the Creation of Budget Incentives for Local Governments in the Republic of Bashkortostan to Develop Economic Development and to Improve the Provision of Public Goods

 

1. Project description

 

Project number	9PR
Project title	Elaboration of Propositions for Creation of Budget Incentives for Local Governments in the Republic of Bashkortostan to Develop Economic Development and to Improve the Provision of Public Goods
Responsible institution	Bashkir State University, Bashkortostan, Russian Federation Ildar Zoulkarnaev
NASPAA partner	Defense Resources Management Institute and Naval Postgraduate School, Robert MacNab
NISPAcee partner	Kyiv National Shevchenko University, Ukraine, Sergii Slukhai
Budget: planned	$11,300 USD
Budget: resources really used	$11,300 USD
Project period:	1.10.2002 – 30.1.2004

 

2.  Project purposes and goals 

 

The main goal of the project was to examine problem of improving budget incentives for local governments in the Republic of Bashkortostan (RB) in order to promote the provision of public goods, spur economic development, and broaden and develop the tax base.

Within this goal more specific objectives were defined as follows:

·          To show advantages and disadvantages of the present system of allocation transfers and subsidies among local governments in Bashkortostan;

·          To critically investigate to what extent the Federal Recommendations for sub-national units of the Russian Federation about intergovernmental fiscal relations are applicable for Bashkortostan conditions;

·          To carry out an formula-based equalization scheme which is the most appropriate for the Republic of Bashkortostan at this time;

·          To gain some level of transparency of intergovernmental fiscal relations in Bashkortostan.

·          To stress relations between Bashkortostan’s budget and the budget of Ufa, the capital of Bashkortostan where 25 percent of the Bashkortostan population lives.

 

 

3. Project realization

 

No major problems occurred during the project realization. The project team cooperated with the government officials (with some marginal problems); the project implementation went as planned; the project timeline was kept on target; and all team members and other participants cooperated actively in the project and fulfilled most of their roles and responsibilities.

There were some problems in concrete cooperation with Bashkortostan’s Ministry of Finance. Minister Gaskarov showed interest in this project, and entrusted cooperation to his deputy Ms. Khafisova who manages intergovernmental relations, but her contributions were very limited. But Minister Gaskarov provided a positive reference to the final report when he promised to use the project results when the Ministry of Finance started to elaborate a new model of intergovernmental relations in the Republic of Bashkortostan.

 

4. Project outputs, outcomes and impacts

           

The main tangible output of the project is the final detailed report. This material, between other issues, describes the formula-driven mechanism of allocation of financial resources, which can be used in intergovernmental relations in Bashkortostan. The local governments can use this report to understand Bashkortostan’s fiscal system. Students can use this report as a reader to study the fiscal system of Bashkortostan.

A total 300 copies of the report were published in Russian and posted to 62 rayons and towns of the Republic of Bashkortostan, to 88 sub-national units of the Russian Federation, to governmental institutions of Bashkortostan and federal governmental institutions.

            As the outcome, both the institutional capacity of the Bashkir State University, and the quality of public financial management in the Republic of Bashkortostan might significantly improve.