Journal section "Public finances"

Financial Results of the Local Self-Government Reform. Experience of Far Eastern Regions

Leonov S.N.

Volume 14, Issue 6, 2021

Leonov S.N. Financial results of the local self-government reform. Experience of the regions of the Far East. Economic and Social Changes: Facts, Trends, Forecast, 2021, vol. 14, no. 6, pp. 160–175. DOI: 10.15838/esc.2021.6.78.9

DOI: 10.15838/esc.2021.6.78.9

Abstract   |   Authors   |   References
The article examines the problems and main results of the 30-year reform of local self-government, concerning the positioning of the institution of LSG in the “vertical of power”, the definition of the structure of powers and rights, and the formation of the financial base of LSG. The purpose of the work is to determine the basic principles and features of the development of the LSG institute and its financial interaction with the state on the example of municipalities of a large macro-region, which is the Russian Far East. In order to identify statistical patterns, general scientific methods were used based on official data from the Federal Treasury of the Russian Federation, the Ministry of Finance, Rosstat, regional authorities and local authorities of the Far Eastern constituent entities of the Russian Federation. The analysis of the dynamics of changes in the spatial classification of municipalities of the Far East over the years of reform, as well as the state and conditions for the formation of budgets of municipal districts and urban districts of the Far Eastern constituent entities of the Federation for 2011-2019 is carried out. It is shown that in the Far East the situation with the financial security of local self-government is determined not so much by local or Far Eastern, as by all-Russian tendencies. Revealed the presence of a serious stagnation of revenues and expenditure of the municipalities of the Far East; the prevalence of low financial independence of the budgets of the civil society and, especially, of the municipal districts; a decrease in the possibility of free disposal of budgetary resources for municipalities of the Far East, since during the analyzed period the share of grants-in-aid in the revenues of the budgets of municipal districts decreased by 8.6 percentage points, up to 15.9%, and in the revenues of urban districts – to 1.8%, with an increasing share of subventions and subsidies in budget revenues. In general, over the years of reform, the legislative strengthening of the powers and rights of LSG, declared at the federal level, has not received adequate financial support in the region. Proposals for improving the financial component of the LSG reform in the framework of the evolutionary approach have been substantiated. It is shown that constitutional changes, while remaining formally neutral to LSGs, will require clarification of federal legislation for their implementation, which can give rise to a number of latent threats and undermine the principle of organizational isolation and financial independence of LSG bodies. The novelty of the research task is actualized by considering the aforementioned range of issues in comparison of federal trends and the situation in the macroregion under the conditions of changes in the Constitution of the Russian Federation and an increasing understanding of the need to strengthen the financial base of LSG. The materials of the article can be used in the educational sphere and in the activities of public authorities and LSG


municipal budgets, local self-government reform, Far East of Russia

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