The new budget rule could be introduced starting in 2018, Aide to the Russian President Andrei Belousov told journalists, per TASS news agency.

The budget rule is a mechanism used to compile the Russian budget that determines the maximum level of spending based on oil prices. The purpose of the rule is to reduce the budget’s dependence on revenue from the current market situation.

When asked about the likelihood of the budget rule being introduced in 2018, Belousov said, “Well, in principle, yes. I think so. But it is actually already in effect today”.

The new budget rule is basically already being applied, he said.

“It is already in effect for all intents and purposes. This doesn’t concern [currency] procurements by the Ministry of Finance. Procurements by the Ministry of Finance have nothing to do with the budget rule. The essence of the budget rule is that expenditures are cut off when oil prices hit USD 40 per barrel. We agreed on what rate this would happen at – whether it would be at the actual rate or the rate that is fixed in the law on the budget. The decision was ostensibly made that it would be at the rate that is fixed in the [existing law on the budget for 2017]”, he said.

Belousov said the new budget rule needs to be officially introduced as soon as possible.

“As things stand, there are no special debates concerning the budget rule and everyone is proceeding from the assumption that it needs to be introduced as quickly as possible”, he said.

Following the sharp decline in oil prices, the budget rule did not function properly and it was suspended in the 2016 budget. However, Prime Minister Dmitry Medvedev said in November 2016 that he believed formulating a new budget rule was a sensible and necessary step. Medvedev stressed at the time that having a budget rule is better than not having one at all despite the fact that the previous budget rule was highly criticised.