UPDATE/CORRECT: Russia 2016 economic plan to amount to 880 bln rbl: minister

(Adds details after paragraph 3, corrects in headline, lede that the source was Economic Developemt Minister, not Finance Minister)

MOSCOW, Feb 18 (PRIME) -- Russia’s economic plan for 2016 will stand at 880 billion rubles, 185 billion rubles of which will be provided from the government’s rescue reserves and 39.8 billion rubles – from the National Wealth Fund, Economic Development Minister Alexei Ulyukayev said at a meeting with the government on Thursday.

“The total volume of proposed measures will stand at about 880 billion rubles, part of which is foreseen in the current budget. And it can be only slightly adjusted,” he said.

Financing from the government’s rescue fund will stand at 185 billion rubles, and funding from the National Wealth Fund will stand at 39.8 billion rubles, Ulyukayev said. The authorities also plan to provide 38 billion rubles of guarantees to the economy.

Earlier the maximum total volume of the government’s rescue fund was set at 250 billion rubles, so the budget may be adjusted in order to find the lacking financing, Ulyukayev also said.

SUPPORT TO BRANCHES

The government decided to prolong a state mortgage program and to extend it by 16.5 billion rubles, the minister said.

A 39.8 billion ruble aid from the National Wealth Fund will be provided to finance production of rolling stock for Russian Railways in order to support transport machine building.

Agriculture Minister Alexander Tkachyov said that Russia’s budget funding of the agricultural industry will be flat on the year in 2016 amid severe economic conditions, adding that the agriculture is rising.

The 2016 budget envisages a 237 billion ruble funding to the agricultural sector. In early February, the ministry submitted a proposal to the government to decrease financing to 215.018 billion rubles.

SOCIAL OBLIGATIONS AND MACROECONOMIC STABILITY

Finance Minister Anton Siluanov said that the government will have enough funding to fulfill social obligations in 2016.

“First of all, we will provide funding to implement already made decisions and fulfill the current social obligations, which we can fulfill. We must have and will have enough funding to fulfill all social obligations, it is our main task. It includes pensions, social benefits, which will be increased from the budget a little bit more than it was earlier expected,” he said.

Labor and Social Protection Minister Maxim Topilin said that the government has a 5.5 billion ruble additional support for the labor market in case of high unemployment, and 41 billion rubles to pay jobless benefits in 2016.

Siluanov said that the government must take steps to maintain macroeconomic sustainability, and to minimize budget deficit.

The 2016 budget deficit is estimated at 3% of the Gross Domestic Product (GDP). “A deficit of 3% of GDP – such a goal remains, that is why we will make funding decisions for the measures very cautiously in order to prevent financial imbalance,” he said.

The government will make a final decision on the plan by February 25, Siluanov said.

The volume of lacking funding stands at 189 billion rubles, Ulyukayev said, adding that the current budget envisages an about 440 billion ruble rescue funding. The Finance Ministry and the Economic Development Ministry will consider sources of the lacking financing in April, the minister said.

(77.8503 rubles – U.S. $1)

End