1. Relevance.

The growth of corruption in the state and local authorities has become one of the most serious obstacles on the way of Russia’s democratic development. The corruption of state and municipal officers represents a big danger for the state and community as it makes official public and legal relations personal and mercenary relations, substitutes public interest for private, causes transformation of bureaucratic state institutes to semi-criminal institutes, which are dangerous for the community. Russia is a traditionally bureaucratic state with all-mighty functionaries where the person has no rights, and, therefore, with favorable soil for flourishing of corruption. This issue becomes the most crucial during transitory periods for the community when the state institutes are being reformed and control weakens thereof. Our country experiences such period so far. Today it is obvious for everybody the danger, which comes out from the vigorous growth of corruption in the state machine. However, despite of the set above, such danger meets no due opposition either from the state, or civil community institutes.

The openness of the processes taking place in the authorities, their availability for control and influence on the part of the community are the significant trend in the making of transparent and responsible power. One of the most significant processes, which always take place on any level of the echelons of power, is the budget process. The degree of transparency, lucidity of the budget, the option to be involved in its discussion not only for the deputies, but all representatives of the widest public circles are significant traits describing the degree of responsibility of such power to the electorate. On the other part, all efforts aimed to more open and transparent budget are simultaneously the efforts aimed to prevention of corruption.

The sponsor of the program is the St. Petersburg Humanitarian and Political Research Center “Strategy”, a public non-profit organization, which one of the major goals is the development and implementation of the programs in the field of social and humanitarian sciences, public and social management, aimed to economic and social development, making a civil community in Russia. The members of the center are scientists and professors of the city various institutes and higher educational establishments, representatives of power structures, activists of non-profit organizations, political parties of democratic polarity, journalists, businessmen.

The center has been implementing the program “«City residents and authorities setting the course for cooperation. A budget people can understand and influence. Phase three»” since September 1998. The aim of the program 1998-2000 was worded as follows: to develop the participation of non-governmental organizations of St. Petersburg in discussions and approval of the city budget, and also adoption of such experience in other Russia’s regions.

For the period of the implementation of the program (September 1998-June 2000) within the frameworks of purposive directions there were conducted eight (including a local seminar with the Center for Support of Non-Profit Organizations) one day information and training seminars in St. Petersburg for the leaders of NPO and deputies of the local self-government, two two-day information and training seminars in Velikie Luki, Pskov and Petrozavodsk, by one - in the cities joining the project in 1999 Novosibirsk, Yuzhno-Sakhalinsk, Samara, Murmansk. Under the framework of the educational component of the program there were held two six day intensive training in St. Petersburg for advanced participants, and also the leaders of NPO, launching promotion activities for public participation in the regions and who took an active part further on in the arrangement and holding of two day training in Pskov, Murmansk and Shlisselburg (Leningrad region). As a result it was formed the core from the association of NPO and some other representatives of power, who will, in the coming years of the program, hold events related to public participation, first of all, public hearings, review of the budget and estimation of transparency of the budget process and public participation in the regions of the project.

There were printed 3 brochures and a book, covering the materials pertaining to the analysis of the budget, budget process and public participation in St. Petersburg, and also a brief version of the budget of St. Petersburg. Among regional editions – materials of the budgetary analysis of Petrozavodsk, Pskov, Velikie Luki, Samara, Novosibirsk, Yuzhno-Sakhalinsk, Murmansk. Also, there was translated and published the Rating Scale for Transparency and Public Participation in the Budget Process (work experience in South Africa). One can read this material on the Internet. A popular “Work-book for Handling Local and Regional Budgets for Non-Profit Organizations” seems to be valuable. The materials were highly estimated by the addressees, who were non-profit organizations, deputies and officers of local self-governing bodies, budget experts. The inquiries for obtaining such literature continue to come. In a number of higher educational institutions (Petrozavodsk, Novosibirsk, Saint-Petersburg) such books were recommended as additional work-books when studying special courses in economy of the municipal establishment and municipal management.

As a result of expert’s efforts in adoption of the Guidelines on the Provision of Fiscal Transparency in the Budget and Tax Fields, and also said Rating Scale for Transparency of the Budget Process and Public Participation there were worked out regional Questionnaires for estimation of transparency of the budget and budget process. Further on when working under the project it is assumed that they will be consolidated in the Single Questionnaire, which is a part of general practices for estimation of transparency of the Russian budget process and public participation, which may be adopted in other regions.

In the course of realization of this program, and also other programs of the center (and namely, “Prevention of Corruption by the Efforts of Civil Community” supported by the fund NED) there were maintained contacts and information exchange with some similar initiatives in various regions – Krasnoyarsk, Birobidzhan, Khabarovsk, Togliatti, Nizhniy Novgorod, Obninsk, Perm, etc. whose representatives were invited to the summary Conference, 2000, made reports and volunteered for joining the network organization (so-called the Big Project “Transparent Budget”) initiated by the center “Strategy” in order to achieve the complementary efforts in activities for the development of public participation in the budget process.

Lastly, the participation of the representative from the St.-Petersburg Center “Strategy”, head of the Pskov Center for Citizen Initiatives have become significant and fruitful for solution of the project objectives in the work of the VIIth annual conference of the budget services “Investments and Control: Strengthening the State Governance in Modern Economy”, and also “The Briefing for Groups Working with the US Budget and Other Countries” of the International Project of the Center for Budget and Political Priorities, November 11-15 in Washington, D.C. A detailed review with operations of CBPP, and also with international experience pertaining to the participation of public organizations in control over the budget process in their countries allowed to study out better our Russian issues, to outline better the ways for the development of the program, and also to visualize the place occupied by the program in the worldwide movement towards more transparent budget processes and supervision over state finance.

The major objective of this project (September 2000 – August 2002) is the development of public participation in the budget process in St. Petersburg, Murmansk, Petrozavodsk, Velikie Luki, Pskov, Samara, Novosibirsk and Yuzhno-Sakhalinsk, and also assistance in realization of similar initiatives in other regions by way of issuance of the guidelines and documents covering the experience gained and supporting each phase of work.

The following tasks set forth within the frameworks of this objective:

1. Development of the ‘standard’ for transparency in view of the Russian specifics.
2. Estimation of the budget process and public participation.
3. Promotion of the practice of public participation.
4. Development of applied budget analysis.
5. Training of the leaders of non-profit organizations and experts in the specific fields of public participation and budget analysis.
6. Information support of the project and other groups addressing the budgets of the Russian cities and subjects of the Russian Federation.
7. Holding of two inter-regional annual conferences on the program.

In view of experience accumulated by the experts in the development of the Questionnaires pertaining to estimation of the budget process and public participation in the regions, we believe it is perspective under the frameworks of this project to continue the arrangements, which have been launched in adoption of the Guidelines for the Provision of Fiscal Transparency in the Budget and Tax Fields with the application of experience of the International Budget Project in the development of the Rating Scale for Estimation of Transparency and Public Participation in order to determine the so-called ‘standard’ for transparency of the budget process adjusted to the Russian specifics.

At the first phase of such arrangements it is envisaged to test the single Questionnaire for estimation of transparency by way of pilot polls (interviews) in the regions and mutual review of the poll results and discovered failures in technique and procedures. At the second phase, it is supposed to work out a unified methodical approach to the Rating Scale for estimation of transparency of the budget process and public participation with the introduction of the practices developed by the regional experts in order to ensure the comparability of the results of such estimation. As a result of such comparability of the data received and experience studied it is assumed to derive the technique for estimation of transparency of the budget process and public participation based on the unified principles, which may be recommended for adoption in the Russian regions. Such technique will be represented at the IIIrd Inter-regional Annual Conference on the Program and communicated to non-profit organizations or other institutes concerned, which are to arrange such estimation using such technique in other regions in addition to the regions-participants of the project.

The next phase is a direct application of said technique for estimation of regional budget processes for transparency, and also estimation of public participation. In order to obtain objective qualitative data there will be arranged inter-regional groups of experts-organizers of the polls and researchers. The results of the polls are supposed to interpret qualitatively, and also there will be done a comparative collation of the data received.

In such arrangements it is envisaged a close cooperation (a joint project is under discussion) with the International Budget Project of the Center for Budget and Budget Priorities (Washington, D.C., USA).

The results of such phase will be presented at the IVth Inter-regional Annual Conference on the Program.

For continuation of arrangements for promotion of public participation practice in the budget process in St. Petersburg, Murmansk, Petrozavodsk, Velikie Luki, Pskov, Samara, Novosibirsk and Yuzhno-Sakhalinsk the experts of the St. Petersburg Center “Strategy” based on the experience gained under the program, and also similar initiatives will make the analysis in respect of possible forms of public participation in the budget process. There will be established so far the most efficient forms of public participation in the budget process for each of the regions of the project. Eventually, there will be proposed the forms of public participation excluding manipulation by public conscience and ensuring a real participation of the citizens in setting up the priorities for the budget policy or control over the performance of the budget, in view of maintaining the conditions for steady partner relations of public and authorities that does not exclude one-sided initiatives. Thereafter, there will be worked out a model technique for making arrangements in respect of public participation (for instance, public hearings).

Including as a separate project product the expert group preplans to develop and test the mechanism for participation of non-profit ecological organizations in the formation of the budget of expenditure (allotments of the St. Petersburg ecological fund are taken as an example).

It is envisaged to conduct at least one event in each region in respect of public participation in the budget process, and also approve special steps to adopt efficient forms of public participation in the region as a regular practice and their development featuring amendments to laws, training of deputies and leaders of non-profit organizations.

For the development of the applied budget analysis in the regions covered by the project, first, the St. Petersburg Center “Strategy” prearranges to introduce improvements to the Guidelines for Analysis of the Budget and Budget Process, which were elaborated in the center last year during the implementation of the project with the adjustments introduced by the regional experts and practices of the budget analysis for the year 2000. The final document will be recommended as a unified instrument for making the budget analysis in order to ensure the option for comparative collation of changes taking place in the regional budget processes.

Second, in order the budget analysis to be maximum efficiently used by its final-consumer (non-profit organizations, deputies and representatives of executive bodies of local self-government, budget experts) there will be made a preliminary estimation of demand for the budget analysis and choice of the topical field of the budget analysis. Only thereafter there will be set the task before experts to make the analysis of the budget. The results of such analysis will be issued and disseminated based on the specifics of target-groups.

The St. Petersburg Center “Strategy” envisages encouraging the arrangement of work pertaining to the budget analysis, choice of the field of the budget analysis and distribution of the results by the activists of non-profit organizations under supervision of the project experts.

leaders of NPO,

teachers of higher educational establishments,

acting and ex representatives of the executive power (not more than two functionaries of administration are allowed to attend each seminar),

deputies of local self-governing bodies and regional authorities,

post-graduates and perspective students,

journalists working under this topic.

Under the frameworks of the educational component of the project aimed to development of human resources for public participation in the budget process, the following events are scheduled contributing to the achievement of the project objectives:

1. Holding of 4 intensive six day seminars in the Educational center in Pushkin, where the participants will acquire skills for public participation, budget analysis and master the technique for estimation of transparency and public participation.

The practice of conducting such seminars in 1999-2000 has showed that completing such seminars the participants considerably improve their educational level, and also that is not less significant strong motivation for public participation in the budget process and control over spending of the budget funds are formed.

One of the most essential results is formation of the prerequisites for the establishment of the inter-regional team of experts.

The seminar participants will be involved both in the arrangement and holding of two full day workshops in the regions and other forms of public participation in the budget process.

2. Holding of 12 two-day workshops for dissemination of the technique for estimation of transparency and public participation, forms of arranging public participation in Samara, Novosibirsk and Yuzhno-Sakhalinsk where the major participants will be the leaders of NPO and representatives of local authorities.

3. Holding of 4 one-day workshops for dissemination of the technique for estimation of transparency and public participation, forms of arranging public participation and budget analysis in St. Petersburg, where the major participants will be the leaders of NPO and representatives of local authorities.

All three types of said programs forming the educational events will be based on the application of active teaching methods for the adults developed by the experts of “Strategy” in 1999-2000. In addition to acquiring of methodic tools for the applied budget analysis, public participation and estimation of transparency of the budget process, the participants of the educational component of the program will be able to improve their communicative, analytical and creative potential.

For dissemination of the experience gained in the implementation of the program and development of steady ties between the regions of the projects, and also other projects and separate groups working over the budget the St. Petersburg Center “Strategy” prearranges to establish information and methodic and communicative bases (web-site and mailing lists). The work has been already launched in this direction as the project site (www.pskov.org.ru/budget) and maling lists (OpebBudget@lotos.ru, BudgetDisput@lotos.ru and ProjectTeam@lotos.ru). The results of test operation of the site and mailing lists were summed up at the meeting of the project coordinators and experts during the summary conference, June 11-18, 2000 in Puhskin. The availability of communication means for the project participants with the access to wider auditory is acknowledged as a necessary element of activities for the development of transparency of the budget process and public participation.

Such system will provide the following information products to the users:

1.Budget information (draft budgets and supporting documents, budget laws, reports of executive authorities covering the performance of the budgets, statutes and statutory acts ensuring the budget process).

2.Technique for applied budget analysis (including description of the way for gathering and analysis of information on the budget and its influence on specific spheres of life of the population).

3.Technique for public participation (including rules of procedure and reports on public hearings, public consultative councils, training techniques, lobbying techniques of public interests based on the analytical work performed in respect of the budget).

4. Estimation of transparency of the budget process and public participation (‘questionnaire’ related to estimation of transparency, research technique, summary of estimation in the regions and cities of the project).

5. Topical information on the projects and separate events for the development of budget transparency in the cities-participants of the network for transparent budget.

In addition, several mailing lists will allow for the scientists and public activists involved in the budget and finance issues to exchange information promptly in the course of their performance.

For this project the participation of the project participants and other persons to permanent information network will allow monitoring the changes in the situation and adjust the actions while implementing the project. Further on, contracting additional resources the St. Petersburg Center “Strategy” projects to design the English part of the web-site and through cooperation with the International Budget Project (CBPP, USA) to make the contents of this web-site available for a foreign user.

For summarizing the results of the program, review of its achievements and development options, and also to involve other Russia’s regions in the program it is intended to hold inter-regional conferences in St. Petersburg in June 2001 and June 2002 where there will be invited the program participants from St. Petersburg, Murmansk, Petrozavodsk, Velikie Luki, Pskov, Samara, Novosibirsk and Yuzhno-Sakhalinsk and NPO leaders from the subjects of the Russian Federation uncovered by the program. It is also implied to invite the representatives of the International Project of the Center for Budget and Political Priorities (Washington D.C., USA) for attendance at the conference in order to exchange information and participation in the development of the lines of public participation in the budget project.