Planned expenses in the framework of the ambitious state weapons programs for 2011 – 2020 years (LG-2020) - more than 19 trillion rubles (taking into account the procurement of power structures - up to 20,7 trillion) and the Federal Target Program “Development of the defense-industrial complex before 2020” - about three trillion rubles identified a fundamental shift in the attitude of the country's leadership towards the modernization and development of the technical equipment of the Armed Forces and the military-industrial complex. However, the possibility of implementing the planned is in doubt.
The practical feasibility and effectiveness of these programs are rarely discussed in open sources.
The HPV-2020 is focused on increasing expenditures for the purchase of weapons and military equipment, and consequently, on the overall growth of the defense budget with a constant increase in the exponent from 2011 to 2020 a year.
The main problems
The first is the reliance on the rapid growth of procurement and defense expenditures, which is clearly ahead of the pace of economic development of Russia as a whole and the real growth rates of the Russian budget. In fact, the HPV-2020 is based on super-optimistic macroeconomic and fiscal projections, the program has clearly optimistic price parameters for products purchased under the state defense order (GOZ).
Another is that the increase in prices in industry is not sufficiently taken into account. Moreover, it can be assumed that price estimates are extremely optimistic in relation to the cost of promising and just developed models of equipment and weapons. HPV-2020 is based on overly optimistic terms of development and especially the launch into mass production of new types of weapons and military equipment.
It should also be noted that a significant part of the Russian defense industry is not ready after a long decline in the post-Soviet period to implement the specified R & D volumes and serial production. In the article, however, we will focus on the purely software defects HPV-2020.
In a complex, all this means that the current armament program looks difficult to implement, both in terms of finding and allocating the necessary financial resources, and in terms of the implementation of the armament procurement plan according to the nomenclature and number of serial samples. It is not surprising that as soon as the HPV-2020 was launched, almost immediately, from the end of 2011, conversations and projects to reduce the armament program and the growth rate of defense expenditures as a whole appeared in government circles. The goal is to bring expenditures for military needs into line with economic realities and to accomplish the so-called budget maneuver in order to preserve the balance of income and expenditure. These trends continued to be felt throughout the past 2012 year, despite the official declarations of the top Russian leadership on the firm commitment to the implementation of the LG-2020. At the development stage, and then with the start of the program, the then Finance Minister Alexei Kudrin spoke against the approval of the accepted “19-trillion” volume, which was one of the formal reasons for his resignation in September 2011.
The beginning of the implementation of the HPV-2020 led to a rapid buildup of both the state defense order and the defense budget of Russia (hereinafter, the “National Defense” budget section with additions) is meant as a whole. Despite the budgetary difficulties discussed, it will continue in 2013, 2014, 2015. The “ceiling” of credible planning (2015) stems from the current practice of drawing up three-year budgets.
In 2013, the volume of purchases and R & D (1166 billion rubles) will double the level of 2011 of the year and almost four times the level of 2007. An additional factor in the growth of defense expenditures was an increase in 2012 of the size of the monetary allowance of military personnel by an average of three times, and pensions for military personnel by an average of 70 percent.
In the period after 2015, the growth rate of purchases and the military budget of Russia should only accelerate, since the developers of the GWV-2020 wisely transferred most of the program costs to its second five-year period. If in the first five years (2011 – 2015) costs are estimated to be about 5,4 trillion rubles, then in 2016 – 2020 - more than 15 trillions. It can be expected that in 2020, the annual volume of purchases and R & D for HP-2020 will reach around 3,5 – 3,7 trillion, with Russia's total defense expenditures of around six. Military spending in nominal terms will increase fivefold compared to 2010 year.
Thus, the implementation of the HPV-2020 assumes, with the stated desire not to exceed the share of defense expenditures in the country's GDP in more than 3,5 – 4 percent, the latter’s unrealistic growth rates for the period 2011 – 2020. It is worth noting that, according to very optimistic forecasts of the Ministry of Finance of the Russian Federation on the draft budget for 2013 – 2015, it is assumed that 2015’s GDP will be 82,9 trillion, with the sum of federal budget expenditures 15,7. To achieve the level of spending on national defense in 2020, six trillion, with their share in the country's GDP of four percent, the total volume of the latter should be about 150 trillion, that is, double the GDP of the year 2014. Needless to say, this perspective is utopian. Even if we assume Russia's continuous GDP growth in the 2016 – 2020 period of four percent per year (a realistic, if not an optimistic estimate), then in 2020 the GDP volume will be about 102 trillion, that is, only about two thirds of the stated needs of the HPV- 2020. Apparently, these two thirds constitute the most realistic estimate of the possibilities for actually financing the armaments program for the second five years. For the full implementation of the HPV-2020 from the Russian economy requires the current Chinese economic growth rates. This is completely unattainable for Russia, especially while maintaining the current political and economic system that has taken shape since 2000.
The Russian economy over the past decade has only exacerbated its dependence on fuel and raw materials exports, deeply affected by the notorious "Dutch disease" (there is a negative effect on the growth of export prices of the extractive industries), suffering from the dominance of state-bureaucratic structures and the inflated public sector, weak national capital, lack of investment, excessive social and public spending, and enforced “manual control” and government intervention. Economic policy essentially boils down to “praying a barrel,” and the spending of oil and gas money entering the country raises numerous questions.
Under these conditions, it is not surprising that the rates of economic growth and the increase in the volume of GDP in Russia are constantly slowing down and have now dropped to less than four percent per annum, despite continuing high oil prices. Since in recent times conservative, populist, statist (absolutizing the role of the state) and demodernization trends in politics and economics have obviously intensified, we can expect further attenuation of economic growth in Russia and the transition of the Russian economy to a state of permanent languid stagnation, which can most likely be overcome only with significant changes in the political and economic course and the renewal of the country's leadership.
The events of the past year have also demonstrated that in Russia there remains a significant potential for political instability and there is a growing public discontent that threatens to plunge the country into political upheaval in the event of adverse events. Thus, adopted under the leadership of Dmitry Medvedev and Vladimir Putin and so cherished by them, HPV-2020 is in fact a hostage to their own political and economic course and is hardly feasible if the current policy continues. The modern Russian economy simply does not produce enough funds to fully fund the 23 trillion-arms program and support for the defense industry. Apparently, he will not be able to do this for the coming decade.
Recently, the main factor of tension for the domestic “defense industry” has become to the utmost the aggravated disagreements with the “reformed” Ministry of Defense regarding the price parameters of the state defense order and product supply. This resulted in a uniform war of both of these parties, which does not benefit anyone, including the Armed Forces. The desire of the leadership of the Ministry of Defense and its “demilitarized” financial sector to implement strict minimization of costs and prices for purchased products has in many cases led to destabilization of the procurement policy and, in some cases, paralysis in the implementation of some SDR programs. In this regard, it is appropriate to ask the question: what is the situation with the pricing within the LG-2020 and how was the calculation of the planned R & D cost and product deliveries made? In other words, how justified is the 20 trillion figure from an economic point of view?
Judging from the fragmentary information available, the calculation of the estimated cost of the GOZ when developing the LG-2020 was carried out by economic planning bodies, relying mainly on preliminary data from the financial sector of the Russian Ministry of Defense. It is noteworthy that after the introduction of the HPV-2020, there was a hard “clinch” between the military and the industry on contract prices. It was a question of a significant number of orders, including, for example, such large-scale “strategic” programs as the contract for the construction of five nuclear missile submarines of the 955A project, which was signed after almost a year of bickering only as a result of Vladimir Putin’s personal intervention. In all cases, the Ministry of Defense insisted on clearly lowered (from the point of view of the industry) contract prices, moreover appealing precisely to the parameters laid down in the LG-2020.
As noted above, this suggests that in terms of price, the program is based on over-optimistic data. Practical implementation of all R & D and product deliveries will actually require more funds than 20 trillion rubles. Particularly critical are the numerous programs for creating fundamentally new types of weapons and military equipment, the entire R & D cycle and mastering the release of which should be superimposed on the implementation period of the HPV-2020, or even its second five-year plan. The possibility of realistic calculating the cost of such programs for the future in the conditions of the Russian economy and the permanent problems of the military department with the determination of the contract value of even products manufactured for a long time looks very doubtful.
There is a real threat: the actual cost of the implementation of promising programs will actually be several times higher than planned. It should be noted that such a state of affairs with chronic overspending (sometimes multiple) of funds for promising military programs is typical for such advanced countries in terms of building procurement policies of countries like the United States and the United Kingdom, and it would be strange to expect otherwise from less experienced and effective in this regard management of the Russian defense ministry. This state of affairs is observed in the long-standing "post-Soviet" programs of nuclear submarines of the 885 and 955 projects, the Bulava SLBM, the Iskander missile system, the C-400 ground-to-ground missile system, a number of space projects, and in the civil aircraft industry - in a generously funded aircraft program SSJ 100.
In all the cases mentioned, programs require constant financial injections. Their sum far exceeds the original estimates. And even with this, the deadlines for the implementation of programs still constantly “go to the right.” There is a reasonable assumption that the practical implementation of such promising programs as the T-50 fighter, the PAK DA strategic bomber, the Armata, Kurganets-25 and Boomerang combat armored vehicle platforms, and the others will also require constant additional financial costs. As a result, these programs will become “vacuum cleaners”. Expected significant out of the planned targets.
The cost of serial samples of this product is likely to be far surpassing the optimistic forecasts of planners. As a result, the Ministry of Defense will face the impossibility to sufficiently finance all the planned projects. Above the plans for the HPV-2020 hangs the threat of colossal financial "scissors". Financing in a given amount is difficult. In addition, such optimistic planned trillions of 20 rubles most likely will certainly not be enough to implement the program for a given nomenclature. Simply put, there is a risk that in the end 2020 trillions will be required conditionally on the implementation of the HPV-30, and in fact it will be possible to isolate, for example, 15.
Hard to believe
Regarding the promising weapons systems developed by the GWV-2020, it should be noted that Russian official military sources in some cases provide unrealistic information about the planned timing of these projects. So, the commander-in-chief of the Air Force, Major-General Viktor Bondarev, said last July that 2013 fifth generation T-14 fighter jets should go to the Air Force in 50, and production vehicles would appear in the 2015. At the same time, at the time of this application, only three prototypes were built (the first one flew only in January of the 2010), and on the third, tests of a regular radar complex began. Only at the end of 2012, the fourth prototype of the PAK FA joined the tests.
It is worth recalling that when the United States created the Fifth Generation Lockheed Martin F-22A, the duration of the journey from the first flight of the YF-22 demonstrator (1990) before the first production batch of the F-22A (2004) demonstrates to the air force - made 14 years. How the leadership of the domestic Air Force, with far poorer industrial and financial resources, intends to “run” this way in three years and whether it believes in these promises itself - remains a mystery.
Equally super-optimistic statements are being made regarding prospective platforms being developed for the Ground Forces - the heavy tracked Armata (essentially a new main tank), the interspecific middle tracked Kurganets-25 (BMP) and the unified wheeled unified Boomerang (BTR). So, the former Minister of Defense Anatoly Serdyukov and the Director General of NPK Uralvagonzavod Oleg Sienko in February 2012 stated that the prototype of the new Armata tank will be created in 2013, and its mass production and delivery to the Armed Forces will begin in 2015 m. Also in 2013, the first BMP prototypes on the subject “Kurganets-25” and armored personnel carriers on the topic “Boomerang” are expected, and the start of mass production of both vehicles in 2015. Thus, the period from the construction of the first prototypes of fundamentally new armored vehicles to the start of their serial production and delivery to the troops should be two years, amazing by world standards.
The previous domestic serial tank of a truly new generation (T-64) was introduced and worked out in the USSR for a long and painful time during almost all 60s of the 20th century. The refinement process was actually completed only a decade and a half after the start of prototype testing. All 195-e and 90-e fumbled with the promising tank "object 2000", but did not adopt. Wheeled BTR-90 worked out with 1994 year over 15 years and also did not bring to the series.
In light of the above statement by officials about the possibility of creating and bringing to a series a new generation of sophisticated combat platforms in extra-shock terms, they cannot but surprise. The same goes for many other projects. Starting in 2015, it is planned to begin large-scale serial production of modernized and new helicopters, including the Ka-62. At the same time, there are still no flying prototypes of the latter. Not accepted fleet Project 955 lead nuclear missile submarine Yuri Dolgoruky, which has been under construction for 15 years. Nevertheless, by 2020, it is planned to have eight of these submarines, including five of an improved project. Similarly to the same period, during the stretching tests of the lead nuclear submarine of project 885 Severodvinsk, it is planned to build seven more according to the modernized design.
With regard to the development timelines and the commissioning of promising systems, the feasibility of the HPV-2020 raises serious doubts. Most likely, the actual appearance in the troops of the T-50 fighter, the C-500 ZRS and promising platforms of the Ground Forces should be expected no earlier than 2020 of the year, that is, already beyond the period of validity of the weapons program under discussion. Many other projects are apparently doomed to a similar “shift” in terms of time. This circumstance opens up possibilities for adjusting the current HPV in the direction of more realistic parameters with the postponement of the serial purchases of many expensive weapons and military equipment for the period after 2020.