On June 7, at the joint sitting of the NA Standing Committee on Science, Education, Culture and Youth Affairs and the NA Standing Committee on Financial-Credit, Budgetary and Еconomic Affairs the RA Law on the RA State Budget 2005 Execution Report in the spheres of science, education, culture, information and sport was debated.

Atom Janjughazyan, Deputy Minister of Finance and Economy informed that in 2005 14.6 % of the state budget total costs was directed to funding the sphere of education and science - more than 60.8bn AMD. 249.4m. AMD from the state budget were allocated to the state governance body in the sphere: to support the Ministry of Education and Science system in 2005.

73% of expenditures, about 44.4m AMD were allocated for educational system. Comparing to 2004, budget expenditures in the sphere of education increased by 29.1%.

Special general educational expenditures were 3.5bn AMD, to the support of pre-specialized (vocational) educational system 669.4m AMD were spent, to the support of medium specialized educational system – 1.4bn AMD.

During 2005 more than 4.3m AMD were allocated from the state budget to the graduate and post-graduate educational programs, fully ensuring the program allotments: 4.1bn. AMD were allocated to the sphere of science, which is more by 24.2% or 804.8m AMD, comparing to the previous year.

In 2005 from the RA state budget 10.4bn. AMD were allocated to funding the programs on culture, information, sport and religion, which is more by 1.9bn AMD, comparing to the previous year.

1.1bn AMD was allocated to the sport sphere, 3.1bn. AMD - to the sphere of TV broadcasting.

Levon Mkrtchyan, Minister of Science and Education mainly presented the process of educational reforms’ programs and in response to the MPs’ questions mentioned about certain drawbacks of the program implementation funded by the World Bank, which refer to the input of computer network, exam preparation of graduate classes, move to the united exam system.

Hasmik Poghosyan, Minister of Culture and Youth Affairs, presented 2005 budget allocations of different spheres of culture, informing that libraries support expenditures were 601.3m AMD, museums and exhibitions support expenditures – 1.1bn. AMD, 96.8m AMD was allocated to financing houses of culture, clubs and centers, 1.7bn. AMD were allocated to financing of art programs, 447.6m AMD – to cinematography, 527.3m AMD was allocated to the restoration and preservation of monuments and cultural property.

The representatives of the RA Committee on Physical Culture and Sport, the RA National Committee on Television and Radio, the RA Radio and Television Council briefed the accomplished budget allocation and undertaken works in their spheres in 2005. At the sitting of the NA Standing Committee on Finance-Credit, Budgetary and Economic Affairs the results of the accomplishment of the state investment programs, directions of 2005 tax and custom policy, formation of incomes sources were debated. Gagik Minasyan, Chairman of the Committee, presided over the sitting.

Atom Janjughazyan, Chief Treasurer, Deputy Minister of Finance and Economy and representatives of branch offices presented the information on invested sums and accomplished programs in different spheres. The expenditures envisioned by the program are almost fully executed; the under-fulfillment is stipulated by imperfect financing of foreign investment sources.

The expenditures of the Ministry of Trade and Economic Development are executed by 93%. The state assistance program of small and medium enterprises has been fully funded: on that purpose the envisioned 300m AMD were allocated. At this time, 9.5 new small and medium enterprises were registered. 1.3bn. AMD was directed to design reconnaissance works in 2005. 27m AMD are planned for mining industry and geological-prospecting spheres. The actual support expenditures of the Ministry of Urban Development were 226, more than 96% of envisaged by the program. The process of reconstruction of educational structures was financed almost for 100%. 260m AMD was allocated to the agricultural sphere in 2005, ensuring 99% of execution. For the realization of veterinary treatment and anti-epidemic measures 1,2bn AMD was allocated, and 6 programs were accomplished. The total envisaged sum, 458m AMD was used for the preservation and restoration of forests. The increase has been registered in this expenditure part:the sum given to the forestry surpasses the indicator of 2004 by 87%. 136m AMD was allocated to the plants protection programs, which completely ensures the envisaged indicator, but yields the indicator of 2004 by 45%. 2.9bn. AMD was spent for improving the quality of soils. 27% of under-fulfillment is registered here. Some part of the World Bank means aimed at the implementation of development program on irrigation systems were not received. In contrast to other spheres, the expenditures over-fulfillment by 103.7% is registered in the spheres of transport and communication. They reached to that indicator due to the over-fulfillment of the World Bank-implemented transport credit programs. During the previous year roads of republican importance were reconstructed for 10bn AMD, which is 4 times more than 2004 cognominal indicator. The expenditures of support and exploitation of these roads was 4.4bn. AMD. The sum of 2.6bn AMD envisioned for the “Expenditures for the City of Yerevan” was completely allocated. 3 bridges, 3 support walls and 260 streets have been renovated. 243m AMD have been allocated for the support of the Ministry of Transport and Communication and Head Civil Aviation Division. The expenditures in the sphere of fuel and energy were 3,6bn AMD in 2005, which is almost the half of the planned. The bigger part of the programs was envisioned to realize through foreign credit and grant measures, which failed. Particularly, the WB program on reconstruction of electrical lines and distributor nets was under-fulfilled. 466m AMD from the state budget were allocated to the support of the Ministry of Energy and Committee on Regulation of Public Services.

Armen Alaverdyan, Deputy Chief of the Tax Service, presented the 2005 budget revenue. The budget revenues were more, than it was expected: 374,7bn. AMD of revenues was received and official transfers from the envisaged 345bn. AMD. It surpasses the indicator of 2004 by 24%.The tax revenues were 304bn. AMD and were distributed evenly throughout the period. 46bn AMD were debited to the budget, which is 14,5bn AMD more comparing to 2004. Two types of taxes were under-fulfilled: the excised and the simplified. The first one was stipulated by the fall of dollar value (decreased the revenues from tobacco realization and petrol import). The second under-fulfillment was stipulated by the reason of diminishing by the law the field of simplified taxpayers. The highest index of collection of obligatory social payments was registered in 2005. For the first time the process of tax collection was implemented by the tax body through tax mechanisms. 5.4 % of the budget revenues, according to Gagik Khachatryan, Deputy Chairman of the State Customs Committee, were ensured by custom’s duty.

Only 10% out of 135 000 legal entities is engaged in investment. The main part of them is producers. The increase of profits promoted to the increase of revenues. There are also types of goods e.g. eggs and poultry, the import volume of which has essentially decreased due to the development of local production.

The debates of the parliamentary committees on 2005 state budget execution report were summed up.