Azernews.Az

By Aynur Jafarova

Several Committees of Azerbaijan's Parliament submitted the draft state budget for 2014 for discussion at the plenary meeting on November 6.

The draft was submitted by the Science and Education, Legal Policy and State Building, Regional Issues, Culture, Human Rights and International and the Inter-parliamentary Relations Committees of the parliament.

During the discussions, Finance Minister Samir Sharifov said that in 2014 Azerbaijan would direct over 600 million manats (nearly $765 million) to increasing salaries, pensions, and other social benefits.

According to the minister, this growth will affect three million people. An additional amount of 200 million manats were envisaged in the 2013 budget for increasing wages and social benefits for three million people from September to December.

The number of employees at state organizations that will benefit from the increase in wages stands at 700,000 people, including employees of the education and healthcare sections (about 422,000 and 140,000 people respectively).

The Minister also said that Azerbaijan would increase expenditures for implementing target programs in the social sphere by 885 million manats in 2014. These programs also include the recently adopted State strategy on the development of education in the country.

According to Sharifov, the social-oriented expenditures of the state budget are projected at 5.337 billion manats for the next year.

Furthermore, 2.5 million manats will be allocated to financing the country's political parties, and 5.2 million manats will be assigned for financing the municipal power.

Sharifov went on to say that two more Azerbaijani cities, Mingachevir and Imishli, would stop receiving subsidies intended for centralized government expenditures in the next year, having to pay their own expenses.

The Minister said this only applied to current costs, and the cities would continue to receive funds from the budget for covering capital expenditures.

Sumgayit, Shirvan, and Absheron currently pay for expenses from their own resources.

Sharifov went on to note that the Finance Ministry would study the effectiveness of government investments.

"We regularly conduct appropriate researches. It is important to understand that there are fields in which investment does not bring direct profits, but they are necessary for infrastructure, road construction, and melioration work. They don't bring direct profits, but if no funds are invested in them, it will impact agriculture, decrease income, and so on," he said.

According to the Minister, the main criterion for determining importance of funds allocation is the guarantee of the absence of additional costs for the same project.

The volume of government investment in the country for 2014 was forecasted at 7.37 billion manats.

Responding to the MPs' questions regarding the difficulties faced by peoples of the country's regions in obtaining bank loans, the Minister said that the Azerbaijani banks were independent where risk management was concerned.

"I understand that the essence of these problems lies in the fact that banks are reluctant to accept rural properties as mortgage because of the issue of liquidity and other factors. Therefore, they prefer to accept properties that are located in Baku and other large cities as mortgage," Sharifov said.

According to Sharifov, the Finance Ministry did not see the possibility of using administrative measures to affect the situation.

"Commercial banks in the country conduct their own risk management policies and they are independent in this regard. The Finance Ministry can not intervene in this matter," he said.

Chairman of the Science and Education Committee Shamsaddin Hajiyev said that Azerbaijan's 2014 state budget reflected real indicators and tasks, and its implementation would not be followed by serious difficulties.

He said that the 2014 state budget outlined the path of the country's future economic development.

"One of the characteristics which distinguishes the current draft budget from analogue packets of previous years is that the budget also includes forecasts of Azerbaijan's economic development for the coming years. Furthermore, the state budget, as before, has maintained a social and investment orientation which is critically important from the viewpoint of continuing symptoms of global economic crisis ," the committee chairman said.

Earlier, the draft state budget for 2014 was discussed by the Economic Policy, Social Policy, Security and Defense, Natural Resources, Energy and Ecology, and the Agrarian Policy Committees of the parliament on November 4.

According to the draft budget, revenues of the state budget and the expenses for next year were projected to be 18.384 and 20.063 billion manats respectively.

It is expected that in 2014 the revenues be 775 million manats lower than the forecasted figures in 2013, and exceed the actual figures of 2012 by 1.103 billion manats.

The budget deficit is projected at 1.679 billion manats, compared to 691 million manats for 2013 and the actual figure of 135 million manats for 2012.

Revenues of the consolidated budget for 2014 were estimated at 21,986 billion manats which exceeds the forecasted figure for this year by 1.257 billion manats, and the actual 2012 budget performance by 352.5 million manats.

Expenditures will amount to 24,444 billion manats, which is 56 million manats lower than the predicted figure for this year and 5,982 billion manats higher than the actual 2012 budget performance.

The consolidated budget deficit is projected at 2.458 billion manats, making up 4.2 percent of the projected GDP.

The growth of local revenues in the draft budget for 2014 is projected at 11.9 percent -779 million manats. Compared to the actual figure for 2012, the growth of local revenues in 2014 is 46 percent.