16:08 Oct. 6, 2016
Moscow reiterates no funds are allocated from the federal budget to bankroll separatist republics in eastern Ukraine
Russia directly finances pensions and public sector salaries in the two self-proclaimed regions in eastern Ukraine, a former separatist official said in an interview with Reuters.
Alexander Khodakovsky was State Security Minister and then Security Council Secretary in the self-proclaimed Donetsk People's Republic before he was fired this year following a dispute with the separatist leader.
Asked by Reuters if Russia was funding pensions and state wages in Donetsk and neighbouring Luhansk, Khodakovsky said: "Yes. These are the main areas. The budget sector and pensions, which need to be covered as a priority."
"Without outside help, it's impossible to sustain the territory even if you have the most effective tax-raising system. The level of help from Russia exceeds the amounts that we collect within the territory," he said in a Moscow hotel.
The assertion by former separatist minister contradicts Moscow, which says it does not bankroll the separatist administration and, as a consequence, cannot influence the militants to make peace with Kyiv.
A spokeswoman for the Russian finance ministry reiterated on Tuesday that the federal budget made no payments for pensions or public sector wages in the Donbas.
Russian official data contains no information about public money being transferred to eastern Ukraine. About a fifth of budget spending is designated secret.
A spokesman for the finance ministry in the Donetsk separatist administration said sources of financing could not be disclosed for security reasons. The finance ministry in the Luhansk People's Republic, could not be reached for comment.