Alfa-Bank analysts, relying on preliminary data from the budget draft, calculated that federal budget spending not related to the army, weapons production, security forces, and interest payments on public debt will amount to about 9% of GDP in 2027. This is the lowest level in two decades: in 2023–2024 the figure was about 12% of GDP, in 2021 — 13% of GDP, and in the current and previous year — a little over 10% of GDP.
The peak of civilian spending came in 2009–2010, when this figure reached 16–18% of GDP. The budget spending structure, the analysts write, is becoming a “challenge”.
In 2027, 17.1 trillion rubles, or 35% of all spending, will go to the “national defense” item. This will be a new record since the Soviet era.
To fund the military budget, key civilian items will face cuts of 900 billion rubles. Spending on social support for citizens, according to Alfa-Bank’s calculations, will decrease by 7%, on education — by 6%, on healthcare — by 6.8%, and on environmental protection — by 5.8%.
Reuters, citing materials from the Finance Ministry, wrote that the ministry planned an additional cut of 2 trillion rubles for 2028. To cover the deficit, the Finance Ministry also intends to borrow more: this year’s public borrowing program has been increased by 1 trillion rubles, and next year’s by 2.3 trillion, to 7.3 trillion rubles.
As a result, next year the budget will have to spend almost every tenth ruble on paying interest on public debt. Alexander Kolyandr, Europe director at the international consulting firm Eurasia Group, called what is happening “putting the future in hock for today’s geopolitical goals and tasks”, while Alexandra Prokopenko, a research fellow at the Berlin Carnegie Center for the Study of Russia and Eurasia, noted that for every ruble that in 2027 will go to social policy, healthcare, and education, two rubles will go to the army, police, the National Guard, and the security services.
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