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constituent, which is defined by the number of the employed in 2000-2006. According to the forecasts of the Ministry for Economic Development and Trade, in 2007 the share of the employed in the number of population capable for work will increase by nearly 1p.p., reaching the maximum after 1998 level of 91.3%, which will lead to the increase in estimation of employment input into GDP growth rates as compared with the previous years. Average growth rates of hours worked by an employee remains behind the growth rate for the number of employed in 2000-2006, which secures on average 1.4% of the GDP growth rates. Taking into account reduction in this indexТs growth rates, which was observed in January-September 2007, specification of breakdown with consideration for worked hours will not lead to significant changes of labor input in GDP growth rates.

Table 1.

Structure of Annual GDP Growth Rates 1999- 2000- 2001- 2002- 2003- 2004- 2005- 2006 2000 2001 2002 2003 2004 2005 2006 Growth rates GDP 9.40 5.00 4.70 7.30 7.20 6.40 6.70 7. I. Factors input 3.21 1.52 0.96 2.34 2.99 1.82 4.21 3. I.1 Labor 0.40 0.25 0.32 0.26 1.03 0.02 0.28 0. Employment 0.19 0.21 0.38 0.21 0.43 0.22 0.13 0. Hours worked 0.21 0.04 -0.07 0.05 0.60 -0.20 0.15 - I.2 Capital 2.82 1.28 0.65 2.09 1.96 1.79 3.94 2. Fixed assets 0.27 0.39 0.43 0.42 0.54 0.68 1.44 1. Extent of facilities load 2.55 0.89 0.21 1.67 1.42 1.11 2.50 1. II. TFP 6.19 3.48 3.74 4.96 4.21 4.58 2.49 3.As percentage from GDP growth rates GDP 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100. I. Factors input 34.20 30.48 20.46 32.08 41.54 28.40 62.89 46, I.1 Labor 4.22 4.92 6.73 3.51 14.28 0.38 4.15 5. Employment 1.99 4.12 8.13 2.88 5.97 3.47 1.89 5. Hours worked 2.23 0.80 -1.40 0.63 8.30 -3.09 2.27 - I.2 Capital 29.98 25.56 13.73 28.57 27.26 28.01 58.73 40, Fixed assets 2.86 7.84 9.22 5.73 7.50 10.60 21.44 25. Extent of facilities load 27.12 17.71 4.51 22.84 19.76 17.41 37.29 15, II. TFP 65.80 69.52 79.54 67.92 58.46 71.60 37.11 53,Increase in volume of investments in fixed assets growth rates, which outlined in recent years, led to intensification of fixed assets renovation processes and decrease in the extent of their deterioration (for instance whereas in 2002 the extent of fixed assets deterioration was equal to 44%, in 2006 the value of this figure went down to 36.6%). As a result of these processes the growth rates of fixed assets volumes increased, which caused the change in the structure of capital input in the GDP growth rates. In 2000-2006 the changes in capital reserves accounted for on average 9.3% of output growth rates, whereas 21.6% of GDP growth was due to the increase in intensity of its use. In 2007 the input of capital reserves in the GDP growth rates (25.5%) exceeds the input determined by changes of the extent of its load (15.4%).

Preliminary estimation Forecast of the Ministry for Economic Development and Trade The volume of investments for 2007 is estimated on the basis of Ministry for Economic Development and Trade forecast Estimation of the change in facilities load is based on the supposition that the share of the power consumed in the amount of produced is constant. The volume of power to be produced in 2007 is estimated on the basis of regression based on monthly statistics TFP Worked hours Epmloyment Extent of facilities load Fixed assets -2000 2001 2002 2003 2004 2005 2006 Fig. 1. Structure of GDP Growth in 2000-1997 2007 --y = 0.1141x - 0.-R = 0.----40 -30 -20 -10 0 10 20 30 40 50 60 Oil prices growth rates, % Fig. 2. Comparison of TFP Growth Rates and World Prices for Oil in 1993-Analyzing the dynamics of TFP the trend for slow-down of its growth rates should be noted that: in accordance with the linear trend the decrease of TFP growth rates in 2000-2006 was equal to 0.33 per cent points (in compliance with the preliminary estimations the value of this index is 0.24 p.p. for 2000-2007). In case main extensive factors growth rates decrease such a trend can be the cause of the output growth slowdown process.

For 2007 prices for oil growth rates are estimated on the basis of 11 months data.

TFP growth rates, % The estimation of TFP obtained reflects the influence of not only technological growth components such as different changes in management efficiency and level of production technology used that enable to increase factor productivity, it also includes the effect of situational factors, accounted for by uneven output prices dynamics and capital reserves, out of which the changes, defined by the dynamics of world prices for oil play an important role. The evidence for interrelation between unexplained main factors (labor and capital), output growth (that is TFP estimation) and changes in oil prices is presented in the figure.

The estimation of this dependence allows conventionally divide the obtained TFP estimation in two constituents: Уdue to the dynamics of world prices or oilФ and Уfinal restФ, the latter could be regarded as a characteristic for technological productivity change, i.e. intensive component of output growth (see fig. 3).

Final rest Oil prices growth Worked hours Employment Extent of facilities load Fixed assets -2000 2001 2002 2003 2004 2005 2006 Fig 3. Breakdown of GDP Growth by Factors in 2000-2007 with the Estimation of Prices for Oil Effect As a result of breakdown21, highlighting of factor of price situation at the world raw materials markets leads to the decrease in the contribution of УtechnologicalФ component in GDP growth rates. On average over the period of 2000-2006 the changes of price factor determined 27.4% of output growth rates whereas technological productivity (Уfinal restФ) - 36.3%. At the same time in accordance with linear trend the growth rates of the price factor has increased annually by 0.12 p.p., whereas the growth rates of technological productivity have reduced by 0.46 p.p. In contrast, according to preliminary estimations for 2007, the decrease of component characterizing price situation at the world raw materials market input in GDP growth rates down to 0.3% is observed and the increase of intensive growth component contribution up to 53.5%.

Thus, in 2007 for the first time over the last four years the prevailing factor of GDP growth was technological productivity, whose increase despite the reduction in oil prices annual growth rates, was able to secure GDP growth rates acceleration.

Thus, according to the estimations obtained, over 2000-2007 despite the outlined trend for growth rates reduction, total factor productivity remains the prevailing factor for GDP increase, accounting for on average 60% of output growth rates. At the same time it should be noted that in 2006-2007 the decrease in TFP growth rates is determined by the dynamics of price at the world markets for raw materials, whereas technological productivity growth rates are increasing.

The number of observations being low and model specification - simple, one can make only rough estimations (it should be assumed that the estimation of oil prices growth input in TFP can be set a bit too high).

Financial Results of the Program for Additional Provision of Benefit Recipients with Medicines S.V.Shishkin In October-November 2007 a number of regulation resolutions that conclude in a way were made that sum up the financial and organizational results of program for additional provision of come categories of citizens that receive governmental social support form the federal budget with medicines fulfillment in 20052007.

The program for additional provision with medicines (APM) of some categories of citizens that receive governmental social support from the federal budget that was launched in 2005 had quite an ambitious objects, namely to change qualitatively the conditions of medicines provision of the disabled, war veterans, peopled experienced radiation influence, expanding the list of medicines that are provided free of charge so as not to limit the doctors in their prescribing. In 2005 RUR 48 bln was allocated from the federal budget to pay for medicines for benefit recipients, which is 6 times more than in 2004.

However there were serious flaws in the proposed scheme from the beginning. Benefit recipients were given the choice: to remain a member of the program or to receive monetary compensation. The sum of compensation and the sum for medicines for a person who remained in the APM program were equal. It is obvious that those with higher need for medicines remained. The volumes of the medicines prescribed were not however regulated. Under such conditions system default was a matter of time. It is to be noted that experts had warned the Ministry of Health Care and Social Development about such flaws abut it hoped that the funds allocated from the budget would be sufficient for the normal operation of the system. And indeed there were enough funds for 2005. The expenses for medicines provided for benefit recipients were equal to RUR 44.0 bln.

8.4 mln out of 16.3 mln of citizens that have a right for social support from the federal budget remained the members of the program of APM in 2006. Others preferred to take monetary compensation. Taking into account the reduction in the number of recipients of the set of social services, to which except medicines free provision with sanatorium-and-spa treatment as well as transport to the place of treatment is included, the allocations for APM program in the federal budget were originally equal to RUR 29.1 bln. But the demand of benefit recipients for medicines aided by pharmaceutical companies that encouraged doctors to prescribe more expensive medicines started to grow dramatically. Average price of a prescription went up to RUR in December 2006 from RUR 487 in January 200622. Already in the middle of 2006 the deficiency of funds to pay for bills presented by the pharmaceutics distributors evolved. In total the sum of the invoices for payment for medicines provided for benefit recipients was equal to RUR 67 bln by the end of 2006 and finally the distributors presented the bills at the sum of RUR 75.9 bln for payment.

To pay the bills the rest of the means of the Federal Fund of Compulsory Health Insurance of 2005 at the sum of RUR 5.0 bln was used. In December 2006 RUR 10.0 bln was allocated from the federal budget of 2006 was allotment of RUR 6.0 bln more was envisaged from the federal budget of 2007 (clause 8 of the Federal Law УOn the budget of the Federal Fund of Compulsory Health Insurance for 2007Ф from 29.12.No 243-ФЗ). According to the Federal Law УOn making changes to the Federal Law УOn the budget of the Federal Fund of Compulsory Health Insurance for 2007Ф ФЗ No 132 from 17.07.2007 it was envisaged to allocate RUR 10 bln more to settle the payments for medicines provided in 2006. However these means were obviously insufficient. The sources of funds to defray RUR 14.8 bln left were determined in November 2007 by Federal Law УOn making changes to the federal Law УOn the federal budget for 2007Ф and Federal Law У On making changes to the Federal Law УOn the budget of the Federal Fund of Compulsory Health Insurance for 2007Ф signed by the President of the Russian Federation on 24 November. As a result to settle payments for the medicines supplied according to the APW program in 2006 RUR 22 bln was allocated and RUR 8.8 bln was allowed to be used from the regular insurance reserve of the Federal Fund for Compulsory Health Insurance.

It is interesting to note that the Federal Fund of Compulsory Health Insurance made an examination of the bills issued by the distributors in order to consider the conformity of the medicine prescribed and really provided with the illness diagnosis, simultaneous prescription of incompatible medicines and compliance of the medicine prescribe to patientТs sex and age. The examination revealed the inconsistencies of medicine Here and below in not stated otherwise the data of the Federal Fund for Compulsory Health Care are given ( provision at the total sum of RUR 5.7 or 7.5% of the total amount of the medicines provided. However, despite these results extra financial means were allotted at the rate that compensates for the total sum of the bills.

Financial crisis of APM program make the authorities of the Ministry of Health Care and Social Development undertake a number of measures to correct its principles. On October 2006 the list of free and favorable medicines was shortened. Provision of benefit recipients suffering from serious chronic diseases (nosologies - haemophilia, mucoviscidosis, hypophysial nanism, myeloleukemia, Gaucher's disease, disseminated sclerosis and immunosuppression during organs and (or) tissues transplantation) with medicines was apportioned from the APM program to the separate program financed from the federal budget. According to the Federal Law УOn making changes to the federal Law УOn the federal budget for 2007Ф from 24.11.2007 RUR 47.9 bln is allocated for these purposes.

In February 2007 the new procedure for medicines prescription was established (order of the Ministry of Health Care and Social Development of the Russian Federation No 110 from 12. 02.2007) that requires carrying it out in compliance with approved treatment standards.

However these measures were insufficient to avoid the repetition of planned expenses for medicines provision of benefit recipients shortage to repay for the cost of medicines supplied. The Ministry of Health Care and Social Development, Federal Service for Health Care Supervision and Federal Fund of CHI obviously were unable to provide central control over validity of medicines prescription for benefit recipients. This was easier for regional and local authorities to carry out, but they were originally debarred from the financial flow movement in the system of APM and were not charged with definite responsibility for results of its carrying out. Numerous inconsistencies of the medicines and its volumes that were provided by distributors with inhabitants needs were also a cause of dissatisfaction in the regions. Authorities of the subjects of the Russian Federation did not have efficient tools to regulate these supplies, since both the list of medicines and suppliers were determined by the federal bodies.

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