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The meeting was attended by Prime Minister Mikhail Mishustin, Chief of Staff of the Presidential Executive Office Anton Vaino, First Deputy Prime Minister Denis Manturov, Deputy Prime Minister – Chief of the Government Staff Dmitry Grigorenko, deputy prime ministers Alexander Novak, Marat Khusnullin, Dmitry Chernyshenko, Deputy Chief of Staff of the Presidential Executive Office Maxim Oreshkin, Minister of Industry and Trade Anton Alikhanov, Minister of Economic Development Maxim Reshetnikov, Minister of Finance Anton Siluanov, Minister of Construction, Housing and Utilities Irek Fayzullin, Minister of Energy Sergei Tsivilev, and Central Bank Governor Elvira Nabiullina.

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President of Russia Vladimir Putin: Colleagues, good afternoon.

We are holding our first meeting on economic issues this year. Today, I suggest summing up the preliminary results of the past year, 2024, with respect to the state of affairs in the real sector and in finance, including the public sector.

Overall, as we have previously discussed, last year was notably successful for the Russian economy. The key macroeconomic indicators are in the positive range, owing to the responsible, calculated, and coordinated actions of the government and the business community. We will once again examine them in detail today.

I would first like to say a few words about the federal budget. Its deficit last year was estimated at 1.7 percent of GDP. This is an acceptable level, particularly when compared to the state of public finances in certain so-called developed economies.

In 2024, budget deficit-to-GDP ratio was estimated at 6.2 percent in the United States, 6.2 percent in France, 3.8 percent in Italy, 3.7 percent in Japan, and 2.2 percent in Germany.

I should also mention that our indicator aligns with the forecasts incorporated into Russia’s budget for the forthcoming three-year period from 2025 to 2027.

Last year, budget revenues unrelated to oil and gas sales increased by 26 percent, amounting to 25.6 trillion rubles. This is nearly 800 billion rubles more than the Government anticipated in the autumn. This indicates that the state treasury now possesses a reliable revenue base, which is significantly less dependent on external conditions in the commodity markets.

Similarly, last year’s additional oil and gas budget revenues amounted to 1.3 trillion rubles. This will enable us to maintain the size of the National Welfare Fund, even considering that some resources were applied toward government spending and large-scale, systemically important investment projects. Thus, we are preserving the potential and capabilities of the National Welfare Fund as a crucial stabilising mechanism and, concurrently, a development instrument.

I reiterate: it is imperative to continue to ensure the stability and sustainability of public finance. In this context, I would like to remind you that the budget for the next three years has been drawn up to take account of reverting to the budget rule.

The federal budget priorities were discussed in detail at a meeting of the Council for Strategic Development and National Projects in December. The main goals for 2025 were outlined at that meeting as well.

These include transitioning to a balanced growth model and the development of the supply-side economy, bolstering Russia’s technological sovereignty and making domestic goods, services and technologies globally competitive, creating our own payment, insurance and logistics infrastructure, and of course, overcoming negative demographic trends and increasing the birth rate.

To reiterate, all our socioeconomic policy measures, national projects and state programmes, and all our budget mechanisms must work to address these problems.

As usual, the federal budget priorities include ensuring social justice and improving the well-being of those Russians whose incomes are still low.

Social payments and benefits will be indexed this year to go in line with actual inflation. By the end of last year, inflation exceeded the Central Bank’s targets and expectations, reaching 9.5 percent.

I must note that inflation was also higher than the Government’s forecast. Naturally, we need to respond. There is something I would like to point out in this regard.

Our plan was to raise insurance pensions by 7.3 percent from January 1, that is, by the projected level of inflation. As I just said, and as we all know, inflation turned out to be higher. Therefore, I suggest adjusting insurance pensions based on the actual situation, specifically according to last year's real inflation rate, which was 9.5 percent, no later than January.

I realise that January is almost over; therefore, I ask you to implement this decision retroactively and adjust insurance pensions by 9.5 percent from January 1, 2025, making additional payments in February.

There is something else: the so-called military pensions were indexed on October 1, 2024 – including payments for length of service, disability and loss of breadwinner. They were increased by 5.1 percent.

I believe it would be right and fair to make an additional adjustment for military pensioners, taking into account the actual price rises last year, also retroactively, from January 1, 2025.

I would like to ask the Government to take the necessary steps as soon as possible to implement these and other decisions concerning the adjustment of social benefits and allowances.

Colleagues, I have previously stated that our objective is to achieve moderate inflation while generally avoiding imbalances within the economy and the consumer market. It is crucial to closely monitor demand, its sectoral structure, and lending volumes.

In December, the growth of the corporate loan portfolio significantly decelerated, and in January, it is currently below the target benchmarks. Nevertheless, the quality of the loans issued remains high. Loan arrears in the corporate portfolio – that is loans to companies and businesses – is 2.6 percent, whereas, in the retail portfolio – loans to individuals – it is 3.7 percent. These indicators remained stable throughout the previous year.

The Russian banking sector, in turn, possesses a sufficient capital reserve, which increased over the past year. The sector is steady and has the necessary resources to finance the domestic economy’s development.

It is evident that a reduction in lending could pose risks to long-term growth. We addressed this issue recently at a meeting with the business community. It is imperative to prevent such distortions and, generally, to ensure an increase in the loan portfolio that supports robust economic dynamics while simultaneously achieving the Central Bank’s inflation targets. This is not an easy task, but we must strive to accomplish it.

I would like to emphasise the necessity of engaging with each sector, as the overall picture might indicate normal growth in aggregate demand within the economy, signifying a substantial volume of loans issued, but the situation may vary across individual sectors.

In this context, I would like to remind you that at the end of last year, during the meeting with the business community I just mentioned, we agreed to resume the activities of the Government Commission on Enhancing Economic Resilience. This body was active during the coronavirus pandemic, when the Government established this mechanism, which proved effective – particularly in preparing and implementing timely decisions to support enterprises, businesses, and industries. This experience should undoubtedly be considered when formulating sectoral and economic policy as a whole, especially now that the Government has new digital tools for planning and forecasting.

I anticipate hearing my colleagues’ proposals today on ensuring the sustainable development of industries such as the coal industry – an issue we also discussed recently – the construction industry, the manufacturing of building materials and lorries, as well as public transport.

I would also like to remind you of the instruction issued following the recent Council on national projects. Specifically, in the first quarter of this year, I expect my colleagues in the Government to devise a roadmap on a comprehensive agenda for structural development and enhancing the potential of the Russian economy. This includes measures to support businesses that should have the maximum impact on increasing the output of goods and services.

Let us get down to work. Mr Reshetnikov, please, you have the floor.

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