A new measure of social support does not solve the problem of poverty and population decline

the message To the Federal Assembly, President Vladimir Putin offered assistance to the population: benefits for poor families with children, the expansion of the program of the parent capital and compensation of expenses of regions on investment benefits for business. It will cost in 2020, 300 billion rubles., and with 2022 – 600 billion, considered the Ministry of economic development, and help to get out of the trap of weak demand. The first Vice Premier and Finance Minister Anton Siluanov higher in 2020 will require an additional 400-450 billion roubles (“Interfax”).

the Program of the parent capital will be continued until the end of 2026, the payoffs and the firstborn (466 000 RUB.), and for the second child (150 000 RUB). The birth of the third child can already receive from the state 450 000 rbl. for repayment of the mortgage loan.

Fertility support and monthly allowance for childcare: from 1 January 2020 the money will be able to families with children up to seven years if the family income is not above the subsistence level per person. In 2020 it will be 5500 and 2021 – about 11 500 RUB per child.

Another proposal will affect business: the Federal budget will return to the regions of 2/3 of the investment costs for the tax deduction provided to the business. Solvent demand of the population, hopes of economic development, therefore, needs to be stimulated long-term growth of wages.

the Budget is balanced at a low price of oil, higher costs should not be a problem, says the head of the Economic expert group Evsei Gurvich: it is possible to increase the cut-off price in the budget rule. To help the population will be spent in the 0.3–0.4% of GDP per year, the budget is irrelevant, I agree, chief economist at ING Russia Dmitry Dolgin. If the price of oil falls to $25 a barrel, to pull, evaluates the Director of “SKOLKOVO – NES” Oleg Shibanov.

state Aid will provide additional growth in real disposable incomes – by 1 percentage point in the second half of 2020 (and by 0.5 percentage points for the full year). According to the forecast of Ministry of economic development, in 2020, real incomes should grow by 1.5%. Putin’s proposal will increase the income of 20% poorest households – on average by 10 PP in the second half of 2020 will reduce poverty for the 1.3 p. p., and investment activity will grow by an additional 1 p. p. Only Putin’s proposal would increase GDP growth by 0.3 percentage points to the current forecast (the economy will grow in 2020, 1.7%).

In January – September 2019 real disposable income increased only 0.8%. Increased poverty (the number of people with income below 10 000 RUB per month) for the first three quarters 2019 such income was 13.1% of Russians (19.2 million) and 13% (19.1 million) for the same period in 2018 Rose and subjective poverty – the proportion of people who assess the situation as “bad” and “very bad”: from 23.3 to 26.5%, according to Ranepa. Poverty should be reduced by half already by 2024, and real disposable income should grow steadily are the objectives of the may decree of Putin.

Targeted support is the best way to help the poor, says Director of the Scientific research financial Institute of the Ministry of Finance Vladimir Nazarov. Up to 85% of the poor are families with many children, incomplete families with children and families with pensioners, says Deputy Dmitry Svatkovsky. Payment to the families of the correct and popular, believes Nazarov. The situation of families with children, just better, agrees Director of the Institute for social analysis and forecasting Ranhigs Tatiana Maleva.

But the demographics of the proposals are unlikely to affect, according to Nazarov, now children will start the generation of the 1990s, very small in itself, and even salient stimuli will not change the trend.

In 2018, the population declined for the first time in 10 years – 146,8 million. In 2019, the trend continued in the first half of the year the birth rate increased in only two regions and the whole country fell by 8.1% from the same period 2018 In December, Rosstat revised the population projection to 2036, the population of Russia will fall to 143 million.

a year after the introduction of the parent capital birth rate has increased by 10%, reminiscent of the NES Professor Evgeny Yakovlev: “Growing it is the birth of second children, the support helped to resolve one of the main restraining factors – the shortage of housing, in 88% of cases, the capital spending on the purchase of housing.” The birth rate is growing not because there the parent capital, it grew before him and will continue to be, argues Maleva. It is possible to predict the growth of birth rate first child, but the second is questionable, says Yakovlev, “But alone is not enough to solve the demographic problem.”

the calculation Svatkovsky, the amount that the government spends on social protection in 2000 increased 4.5 times, while poverty has decreased only 2.6 times. The government spends enough on social support, but the level of poverty has not changed, confirms Nazarov: “the Cost of highly inefficient”. “We are trying to fill with money problems – said Svatkovsky. And overcoming poverty is, of course, economic growth.”

Measures look like compensation to low-income citizens from restrictions in consumer lending and tight fiscal policy of the last five years, including a rise in VAT and the retirement age, says Dolgin: it may be a signal that fiscal policy takes place in favour of greater social support. But it is important that the problem of poverty is solved through an increase in business activity, he said, we need not only investment in infrastructure in the form of national projects and structural measures.