Recent reporting shows that public utility tariffs in Russia rose starting December 1, marking a second increase within a year. The changes are tied to a government decree issued on November 14, as noted by Izvestia and confirmed by the Moscow Department of Economic Policy and Development via TASS.
The press service of Moscow’s Economic Policy and Development confirmed that housing and communal services prices will climb by 9 percent.
“From December 1, the cumulative rise in utility costs in Moscow will reflect a forecast by the Russian Ministry of Economic Development, with a 9 percent adjustment set at the federal level, about five points below the country-wide inflation rate, which is projected to average 13.9 percent this year,” the ministry stated.
The press service added that utilities tariffs have been indexed since December 1 and housing tariffs since January 1. The ministry also indicated that tariffs are not expected to change again until July 1, 2024, in light of the current increases in housing and communal services costs.
“This year the cost of waste management services will remain nearly unchanged. The minimum contribution for capital repairs is planned at 24.09 rubles per square meter,” the Department of Economic Policy and Development pledged.
They also noted that social payments in the capital will be indexed by 10 percent in 2023, exceeding the tariff growth limit for utilities. Subsidies for housing and social services will continue, and TASS reports that around four million Muscovites benefit from these subsidies and benefits.
“Along with tariff indexation, standards for housing and communal service costs will be revised to determine subsidies for residents in need. Subsidies will be available to all Muscovites whose housing and communal service expenses exceed 10 percent of their total family income.”
Index transfer
The decision to index housing and communal services tariffs starting December 1 was reported by September 23 and confirmed by the ministry as the initial plan. The agency explained that prices for services were originally slated to rise on July 1, 2023, but the government opted to index earlier.
The indexation is set to affect tariffs for gas and electricity transmission, water and heat supply, and domestic solid waste services as well.
“The move will keep tariffs from indexing for more than a year and a half. The next update is scheduled for July 1, 2024. The delay aims to ensure uninterrupted operation and development of the housing and communal services infrastructure nationwide while maintaining high service quality. Tariff indexing is needed to fund renovations of heating networks, water pipelines, and other facilities.”
The ministry also pledged that the maximum rise in housing and communal services nationwide will stay within 9 percent. Estimates from the ministry project the average monthly payment for a typical three-person family will rise by about 324 rubles from July 1, 2024, with smaller increases projected for 2025.
“Final decisions on regional indexation levels rest with the government of each constituent entity of the Russian Federation. The Russian Federal Antimonopoly Service will verify compliance with approved limits and prevent unreasonable growth,” a ministry spokesperson noted.
The ministry also stated that all social payments will be indexed to reflect real inflation from 2022. An expert from the Institute for Problems of Natural Monopoly commented that tariff increases have been planned for years, noting that earlier underfunding of public service infrastructure could be a risk if tariffs lagged behind inflation. The expert added that moving the indexation earlier reduces the overall impact on households this year, while still supporting vital service infrastructure.
Industry observers warned that the effort to raise tariffs now may meet resistance in tougher economic times, though some say it is necessary to support the service sector. One industry founder suggested balancing the shift with broader economic support to protect household budgets, especially before winter.
[citations: Izvestia reporting; Moscow Department of Economic Policy and Development; TASS]