Uladzimir Kavalkin: Belarus Returns To Situation Of Poverty Of Late 1990-ies

The head of the project Cost Of Government has told how housing and communal services pricing is taking place, and whether Belarusians would be able to pay the new utilities rates.

The Cost Of the State project in a convenient and understandable fashion helps to learn where the money is taken from and how the money of the Belarusian state budget is spent. The leader of the project Uladzimir Kavalkin in an interview to Radio Racyja told how housing and communal services pricing is taking place, and whether Belarusians would be able to pay the new utilities rates. By the end of 2018 Belarusians are to pay 100% of the utilities rates. Such a statement has been made recently by Belarus’ Economy minister Uladzimir Zinouski.

– How the new rates are formed? And can we speak about transparency in this case?

– We cannot speak about complete transparency certainly, and the reason for that is simple: we have one monopolist in this sphere, who is forming prices. People just have to blindly believe that the rates had been calculated correctly.

– First of all, competition should be created in this sphere. People should understand that there are alternative possibilities, and services of this or that rival are cheaper. It is a normal market approach. Secondly, budgets of housing and communal services’ organisations should be revealed as well – their revenues and expenses, as it is very hard to come to any conclusions by slips. Thus, several new positions could be added, figures filled in there… But one could only believe or not believe these figures, as it’s a matter of trust, and not something that could be checked.

– By the end of the year 2018 Belarusians are going to pay 100% of 100% of utilities rates. Aren’t these empty words?

– Most likely it is one of the demands of the IMF related to possible giving of a loan to Belarus. that is why, in order to get money, Belarusian authorities are going to do so.

– Will Belarusians be able to pay the new rates?

– For today one can still say that these rates are still manageable. We have not reached the level of our neighbours naturally. If we take the last year, Belarusians were paying 5.5% of their salaries. After the rates increase they are going to pay 10 – 12% of household income. As a comparison, this took place in Russia long ago. People would not like that, but it’s a different story. People are going to pay utilities rates, food products, clothes, and there would be almost no savings left. We are returning to the situation of poverty of the end of the 1990ies.