OREANDA-NEWS. October 28, 2014. Current system of intergovernmental relations does not foster development of local economy, Deputy Finance Minister Ruslan Dalenov said during the meeting with the Senate members.

"Why issues of inter-budgetary relations are of paramount concern? If you look at 2013, we discussed this during the governmental report of, today republican help forms nearly 52 percent of the expenditures of local budgets. If you add up the target transfers and subsidies, almost all regions, except the Atyrau Region, are those who receive assistance. And even in Almaty around 10-12 percent receive assistance from the national budget. City expenditures are formed by republican target transfers," R. Dalenov said.

According to him, during transfers’ formation, regional authorities try to show that they do not have income and try to exaggerate expenses to get more help.

Vice Minister also cited the example of a situation where regional akimat does not care who wins the tender: a company of this region or another. This is because the principal tax, corporate income, goes to the state budget. In case if regions receive a part of corporate income tax, the akimats would be interested in development of their enterprises.