The financial plan was reviewed at a meeting of the Board of Directors on Monday. In November it will be submitted for approval to the government.
MOSCOW, 9 Nov. Railways in 2016 will not increase its loan portfolio and new loans will be involved to the extent commensurate with the repayment available, which will amount to about 70 billion rubles, said a source familiar with the updated version of the financial plan of Russian Railways.
According to him, the financial plan was reviewed at a meeting of the Board of Directors on Monday. In November it will be submitted for approval to the government. The source recalled that the Russian Railways investment programme for 2016 will be 432,2 billion. It will be financed by own funds of Railways and government support. The financial plan drawn up on the basis of growth grotteria 9% additional subsidies to it, optimization of costs and expected restoration benefits on property tax for railway infrastructure, which will give 22.8 billion rubles.
The parameters of the financial plan of Russian Railways, says a source close to the Board of Directors, should be assessed as extremely hard. “New leadership, new Chairman of the Board of Directors and the new President dramatically held the optimization of costs. In fact, we can say that the Railways still leave the volume of capital construction and repair, significantly reducing spending plans,” — said the Agency interlocutor.
According to him, this is achieved primarily through the personal responsibility and strictest discipline in matters of competitive procurement of social expenses and expenses for construction and modernization. However, the interlocutor of Agency, we must bear in mind that this financial plan “extremely tough times” is based on optimistic forecasts of economic development in terms of reviving economic growth and inflation.
“If it is possible to say with high probability is just that the predictions all come true in the worst way, and while trends to change this paradigm of the country development is not visible. This means that the Railways will be in a significantly worse situation than projected in the financial plan,” says the source.
All this, he concluded, puts the new leadership of the company in an extremely difficult position, because the internal resources of the Railways are not infinite, and therefore have to be taken for the personnel, the investment program, or repaired.