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The DairyNews studied the conclusion of the Accounts chamber of the Russian Federation on the results of external checks of compliance with the law on budget and budget reporting in 2019 by the Ministry of agriculture. We tell you what conclusions the Department of Alexey Kudrin came to and what the Ministry of Dmitry Patrushev responded to them.

ABOUT THE MONEY 

The actual amount of cash payments for costs of Ministry of agriculture of Russia in 2019 cumulatively amounted to: at the end of first quarter – 43 330,3 million (14,6% of the consolidated budget spending report (hereinafter BSR) (including changes) in the amount of 296 174,39 million rubles, at the end of II quarter – 127 104,1 million (42.9%), III quarter – 195 540,5 million (66%), IV quarter – 292 415,8 million rubles (98.7%).

According to the Accounts chamber, this indicates uneven cash payments for expenditures of the Ministry of agriculture of Russia in 2019. However, the Accounts chamber emphasizes that the smallest share of cash execution in the first quarter of 2019 is associated with the process of concluding agreements with the subjects of the Russian Federation on the provision of subsidies.

In addition, the Russian Ministry of agriculture conducted 54 inspections in 2019 (6 unscheduled inspections).

The results revealed financial violations totaling 1,030. 80 million rubles, which is about 5 % of the total amount of verified funds, and eliminated violations in the amount of 19.58 million rubles, which is 2% of the volume of violations detected. Materials on 43 inspections were sent to the Prosecutor General's office.

The main volume of unused budget allocations in the amount of 1,707. 9 million rubles, or 45.4% of the total volume, is accounted for the activities of the Federal project "Export of agricultural products" and for state support of organizations in order to promote agricultural products to foreign markets.

ABOUT THE UNITED GRAIN COMPANY 

In 2018, the Ministry of agriculture conducted a selection of creditor banks, according to the results of which credit agreements were made with JSC "Rosselkhozbank" as the winner of the selection by the agent – JSC "United grain company".

One of the conditions for selecting the bank was the maximum annual interest rate (loan usage fee) for the entire term of the loan agreement at no more than 12 %, including other fees and payments, as well as its reduction in direct proportion to the reduction in the key rate.

As a result, the UGC made an agreement with the Rosselkhozbank with an annual interest rate of 12%.

In 2019, the UGC was transferred funds in the amount of 4,641.15 million rubles for loans received for the formation of reserves of the intervention fund. 56.06% of the funds were sent to the Rosselkhozbank.

"During the audit, it was found that the Ministry of agriculture of Russia, having information about the annual interest rate applied by its selected lender bank - JSC "Rosselkhozbank", and despite the reduction of the key rate from 7.75 to 6.5% in 2019, did not work to reduce the interest rate of 12% applied on loans attracted by JSC "UGC", resulting in an additional burden on the Federal budget of 419.65 million rubles in 2019", says the report of the Accounts chamber.

ABOUT MILK AND EXPORTS 

The report points out the shortcomings of the Federal program "Export of agricultural products", "which do not contribute to the regional policy of production of export-oriented products".

The Accounts chamber notes that the measures and corresponding indicators of the export development program are not sufficiently linked to the task of the Federal project – the creation of a new commodity mass of agricultural products, including products with high added value through technological re-equipment of the industry and other supporting measures.

For example, the values of indicators are defined in US dollars in aggregate, for example, "Volume of grain exports", "Volume of exports of meat and dairy products" without detailing the commodity nomenclature.

"This approach does not allow us to determine the physical volume of the new commodity mass necessary to fulfill the goals set in Decree No. 204, to assess the need for acreage, livestock, and the need for material and technical resources in the context of the Russian Federation's subjects. In turn, this does not contribute to the formation of a regional policy for the production of export - oriented agricultural products", says the report of the Accounts chamber.

In addition, the program does not provide results for the development of the material and technical base of the Russian agro-industrial complex, there are no measures aimed at developing the personnel potential of the agricultural sector.

The Federal project provides an expansion of exports of meat and dairy products by 2024, compared with 2018 4.7% to 2.8 billion US dollars per year (including dairy products 2.6 times – up to 0.8 billion USD) in the absence of threshold values of the Doctrine of food security of milk and dairy products.

According to experts of the Accounts chamber, the regions have made commitments to export milk and dairy products, which may indicate that the value of the indicator for the export of this product has been reached due to its withdrawal from the domestic food market, which creates risks of further reducing the level of food security for this type of product and may lead to an increase in the volume of imports.

The Agency also notes a "significant failure" to meet the target for exports of meat and dairy products from Russia in 2019: deliveries amounted to 0.87 billion dollars, which is 23.7% lower than the plan. 

By the way, in a comment to the publication "Agroinvestor" General Director of the National Union of milk producers "Soyuzmoloko" Artem Belov believes that the main risk for the industry this year will be a drop in household income and a decrease in the consumption of milk and dairy products in the domestic market.

"And if we see positive dynamics in exports, this will allow producers and processors to feel more comfortable, support prices and profitability of production", Belov commented. This, in turn, will help preserve the companies' investment plans for 2020 and the next years, he adds. In the first quarter of 2020, exports of dairy products increased by 22%, at the end of the year this figure may be 15%. 

ABOUT MILK AND SAKHALIN 

The Accounts chamber noted that the Ministry of agriculture did not control the fulfillment of obligations by Sakhalin region to increase milk production.

In particular, in January, the SIS "Electronic budget" pointed out an indicator of the actual effectiveness of the use of the subsidy "Volume of milk production in agricultural organizations, peasant farm holdings, including individual entrepreneurs" in 2019 - 34.3 thousand tons, while the plan – 30.0 thousand tons. 

At the same time, the audit found that the volume of milk production in agricultural organizations, peasant farm holdings, including individual entrepreneurs who received state support in 2019 amounted to 2,002,357 thousand tons.

In addition, according to the Accounts chamber, in 2019, 66 regions provided inaccurate information about the performance indicators of the use of subsidies to increase productivity in dairy farming.

Earlier it was reported that the Ministry of agriculture commented on the report of the Accounts chamber. "Currently, the Ministry of agriculture of Russia is working to improve methods and optimize costs, taking into account the conclusion of the Accounts chamber of the Russian Federation", said in a statement of the Ministry.