Belarusians should rely on own funds in housing construction in 2017
In 2017, the volume of new housing would be reduced to 3.5 million sq. metres, and the share of individual housing construction would gradually increase. In the past five years, the sate built about 5 million sq. metres of housing per year for citizens in need of better housing conditions. A new approach to the financing in the housing construction envisages improvements in the living conditions only for citizens who have sufficient own funds.
According to the Council of Ministers’ decision No 325 of April 21st, 2016, 4 million sq. metres of new housing will be built in 2016, and 3.5 million sq. metres in 2017 to 2020. By 2020, the share of individual housing construction will increase from 30% to 40% of the total volume of housing construction, and 80% of the funding for the housing construction should be from extra-budgetary sources. All apartment blocks by 2020 should be energy efficient. The state has allocated BYR 1.1 trillion for soft loans in construction in 2020, which is a significant reduction compared with BYR 4.8 trillion in 2016.
In 2011 – 2015, 25.8 million sq. metres of housing was commissioned, people funded circa 50% of the housing construction costs from own funds, and soft loans with a total worth of BYR 41.5 trillion were issued. As a result, housing availability for citizens has increased from 25 sq. metres in 2011 to 26.4 sq. metres per person in 2015. More than half of the new housing was built for those in need for better housing conditions.
The new approach to the housing construction is due to the lack of state budgetary funds and the need to restrict administrative lending to the economy. Soft loans in construction will be minimized, and available funds will be insufficient to ensure housing construction even for large families.
The state aims to stop funding the construction of apartment blocks, it would rather support individual housing construction, i.e. it will offer unused land close to major cities for individual construction. For citizens who have enough funds, land will be sold at cheaper as compared with the current prices.
Construction companies will focus on the construction of individual houses. The number of apartments built with soft loans will reduce significantly, creating some shortage on the housing and rental market. In subsequent years, the state will attempt to shift the financing of new housing fully onto citizens, including infrastructure, and will spend the saved funds on industrial modernisation and agriculture.
Belarus is set to abandon the state support in housing construction. State aid for the needy in the housing construction will be minimized and the volume of new housing will depend on funding available from people and their employers.
According to Belstat, in August 7,600 people were dismissed, including 4,800 civil servants. Dismissals of civil servants were due to the optimisation in the public administration by up to 30%. Some civil servants would retain their job however would lose the status of a civil servant. Vacancies on the labour market are likely to reduce in number, thanks to the optimisation, the state administration would increase wages for public servants. The payroll fund for retained employees is likely to increase and some former state employees are likely to get jobs in affiliated organizations. The optimisation of the state apparatus should complete by January 1st, 2018, and some former civil servants are likely to join the ranks of the unemployed.