AuditorsAccuse Russian Ministry of Squandering Forestry Budget

BBCMonitoring International Reports, 22 December 2003

Moscow– The manner in which Russia’s Ministry of Natural Resources performs itsresponsibility to protect the environment is costing the state millions.Auditors from the Russian Audit Chamber came to this conclusion after carryingout an investigation into whether funds allocated from the federal budget in2002 and the first half of 2003 for protection and regeneration of forestryresources had been spent effectively and on the designated purpose.

Thechamber’s information and public relations directorate told an ITAR-TASScorrespondent today that the auditors had exposed “evidence of breaches ofthe Russian Federation’s budget legislation and forestry laws”, which hadled to “big losses of budget funds”. The auditors believe thesuspension of two sections of article 106 of Russia’s Forestry Code contravenedprocedures for levying minimum rates of forest tax and rent. The value of uncuttimber has fallen by over 10 per cent.

Thefelling fund is producing only a fifth of what it is supposed to. As a result,the budget is sustaining a shortfall of about R15bn a year. Because of theministry’s failure to vet spending, 1.46m budget roubles earmarked forprotection and regeneration of forests have been wasted on “variousconferences of ministry officials and on other purposes”. Furthermore, therates of forest tax set by the Russian government and the regional authoritieshave turned out to be 60 per cent lower than current auction prices.

In 2002,state budget spending on protection and regeneration of forests was R4bn higherthan revenue from forestry resources. In a number of regions regeneration ofwoods “is getting virtually no funding”. In Khabarovsk Territory, forinstance, forestry resources yielded revenue of R185m, but no money whatsoeverwas made available for their regeneration.

Meanwhile,losses from forest fires across the country as a whole amounted to R11bn. 


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