Russia To Spend Extra $420 Mln in 2022 To Help Households Weather Inflation

MOSCOW, Oct 18 (Reuters) – Higher than expected inflation this year will lead to an increase of around $420 million in social support payments to Russian households in 2022, news agencies quoted Finance Minister Anton Siluanov as saying on Monday.

After billions in one-off payments were distributed ahead of last month’s parliamentary election, President Vladimir Putin last week ordered his government to come up with additional proposals for social support to cushion the impact of high inflation.

Siluanov, speaking to the State Duma, Russia’s lower house of parliament, said extra spending will lead to a revision of the 2022 social spending in Russia’s three-year budget plan.

The sum is relatively small for Russia, which can easily raise more than that at a single treasury bond auction. But any extra state spending could fuel growth in consumer prices.

Inflation is a sensitive issue in Russia as it eats into incomes already dented by the COVID-19 crisis and the weak rouble.

The extra spending announced by Siluanov does not include the annual increase of pensions in line with inflation, which recently accelerated to 7.63%, its highest level since February 2016, after the government had raised its 2021 inflation forecast to 7.4% from 6.8%.

Inflation is also the primary concern of the central bank, which is expected to raise interest rates for the sixth time this year on Friday, struggling to stop consumer prices from climbing higher. ($1 = 71.2890 roubles) (Reporting by Darya Korsunskaya; Writing by Alexander Marrow; editing by Mark Trevelyan)

Source: https://www.reuters.com/article/russia-budget-inflation/russia-to-spend-extra-420-mln-in-2022-to-help-households-weather-inflation-idUSL8N2RE3NL?edition-redirect=uk