New government measure to increase number of social contracts by 118 thousand

The new government decree on not taking into account cash payments for the birth and upbringing of children when concluding social contracts with low-income people is a technical measure, according to Sergei Smirnov, a leading researcher at the Institute of Scientific Information on Social Sciences of the Russian Academy of Sciences. It will allow 118 thousand citizens to apply for such social forms of support. According to the Ministry of Labor, 720 thousand citizens had a social contract in 2023. Of these, 78% increased their income, and 42% went beyond the poverty level, thanks to them.

Social contracts have long been a measure of support for low-income citizens in Russia. Until 2021, it was possible to conclude a contract to open a business (today its amount is 350 thousand rubles). But it is necessary not only to prove your low income, but also the financial and economic justification of the future business project. And its implementation will be monitored. Leading researcher at the Institute of Scientific Information on Social Sciences of the Russian Academy of Sciences Sergei Smirnov said that in 2019 he came across a very promising business in the province, which a woman was able to open using funds from a social contract. She created a mini-hairdresser. In rural areas, you can get up to 200 thousand rubles to develop a subsidiary farm. "You can't buy a tractor for this money, but small equipment, planting material, livestock and poultry are possible," Sergei Smirnov is sure. Money is also paid to the unemployed in the amount of the subsistence minimum before finding a job and for another three months after employment. A social contract can pay for training or retraining, but not more than 30 thousand rubles. “If you take courses that cost more than this amount, you must pay the difference yourself,” explains Sergei Smirnov.

Since 2021, the purpose of social contracts has expanded. It has become possible to pay for children's education, medicine, housing and communal services, and essential goods. "It is not entirely clear what is included in the list of essential goods," says Sergei Smirnov. "Is butter an essential product or not?!"

On February 24, at an operational meeting, Prime Minister Mikhail Mishustin announced that Russia would stop counting child benefits as income when assigning a social contract as a means of supporting low-income families. He said that he had signed a corresponding order.

According to the Prime Minister, this amount will not be included in the calculation of their per capita income when applying for support. According to experts, this decision will allow an additional 118 thousand social contracts to be concluded annually, the Chairman of the Cabinet noted.

According to Sergei Smirnov, this is a "technical measure that allows for an increase in the number of those entering into a social contract. It is connected with the demographic vector of the state policy. In 2023, according to statistics from the Ministry of Labor, a social contract was in effect for 720 thousand citizens. Of these, 78% were able to improve their financial situation, and 42% were able to get out of poverty."

According to the expert, the social service very carefully checks the income level of the applicant for a social contract. Although, thanks to digitalization, it can be issued through the State Services portal. But the check is no less thorough. Therefore, the exclusion of income items from the list taken into account when determining the material well-being of a citizen is very important for low-income families with children and large families.

Doctor of Economics, Vice-Rector of the Financial University under the Government of the Russian Federation Alexey Zubets believes that “the social contract is a starry-eyed dream.”

"Social contracts are not popular in Russia," he says. "It was some ideal picture of how the poor in Russia are people who accidentally got into this situation and want to escape poverty." But, as it turned out, there are very few such people. Basically, poor Russians want to remain poor. They are not ready to work. Although, if they are offered money, they will gladly take it. "It turned out that if a person wants to work, he has a head and hands, then he will not be poor," explains Alexey Zubets. "The majority of the poor cannot find work because they do not mind being poor. This is the problem with social contracts: help is offered to people who do not want to be helped."

Maybe that's why the share of those who received social contracts is so small from the total population of Russia? And maybe that's why only 42% of them escaped the poverty line? And the rest, like our national hero Yemelya, lie on the stove and wait for the sorceress pike? It's not for nothing that the remake of this fairy tale became one of the most popular in Russian distribution last year.