Russian State Companies' Budgets Are Cracking At The Seams

A crisis of non-payment in public procurement has begun in Russia.

Russian business in 2025 is facing a sharp increase in non-payments by state companies under contracts concluded within the framework of public procurement (223-FZ), report "Vedomosti" with reference to statistics of the Federal Antimonopoly Service and the SME Corporation.

From the beginning of 2025, 1173 administrative cases were initiated for non-payments within the framework of public procurement - 20% more than for the whole of last year (980). The number of small business complaints about non-payment of state companies jumped 2.5 times: last year there were 200 appeals for 1.5 billion rubles, and for the incomplete current year - 482 appeals for 3.6 billion rubles.

The problem of non-payment of contracts under the 223-FZ (regulates the procurement of state companies) is really growing, says the vice-president of the Chamber of Commerce and Industry Elena Dybova. Often government agencies simply cannot pay, she emphasizes: the economy is slowing down, profits are falling, and budgets of government agencies are starting to crack at the seams following the federal treasury.

Profit of Rosneft, the largest raw materials state company, fell threefold in the first half of the year. "Gazprom" for 9 months received 170 billion rubles of net loss in the key, gas business. For the first time in 5 years, RZD became unprofitable, because of which the company cut construction and procurement costs by 40%. Uralvagonzavod, the country's largest tank manufacturer, started mass layoffs due to financial difficulties. About 20% of employees decided to cut Sberbank.

Many large companies are experiencing problems with financial resources and access to credit, confirms the deputy chairman of "Business Russia" Anton Danilov-Danilyan. The reason is the difficult economic situation, he believes. At the same time, if a government customer fails to pay, then not only the general contractor, but also many subcontractors do not receive money, Dybova reminds, as a result of which the non-payment crisis spreads "along the entire chain".

According to the RSPP, in the third quarter 39% of large Russian companies faced non-payments from their contractors. Compared to the second quarter, there were 1.5 times more such companies, and their share grew by 13 percentage points.

Rosstat data confirms: overdue debt of Russian companies to suppliers at the end of August reached 3.841 trillion rubles. Since the beginning of the year, the volume of non-payments has increased by 395 billion rubles (+11%), and if compared to January-2024 - by 993 billion rubles (+35%). 4.52 thousand Russian companies had debts to their counterparties that were not paid on time, and the record-breakers in terms of its volume were companies in the manufacturing industry - 1.53 trillion rubles.

The problem of non-payments arose last year, against the backdrop of a high key rate, recalls the chief economist of Alfa Bank Natalia Orlova. Now the reason may be the slowdown in the growth of budget expenditures, she points out: oil and gas revenues of the treasury are falling rapidly, non-resource revenues are lagging behind the plan, and the authorities are forced to put civilian expenditures under the knife.

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