Russia’s Defense Ministry Postpones Military Pay To January Amid Growing Budget Deficit

Russia's Defense Ministry has announced they will delay military personnel's December pay to January next year for the first time. This decision aims to alleviate budget pressures, as the deficit for the year is projected to exceed initial estimates. According to Bloomberg and UATV English, the postponed payments are scheduled to be issued between January 11 and 21, 2027.

Previously, December pay was required to be disbursed by the end of the month, a tradition dating back to Soviet times. However, servicemembers actively involved in the war against Ukraine will receive their December payments by December 25. The delay enables the Russian government to postpone substantial budget expenditures into the following fiscal year, which is crucial at year-end when a significant portion of state payments typically becomes due.

Russia's financial challenges are intensifying, with state spending for 2026 projected to surpass the planned amount by approximately 10%, reaching 48.5 trillion rubles ($602 billion). Consequently, the projected federal budget deficit has risen to 7.3 trillion rubles, equivalent to 3.2% of GDP, up from an estimated 2.2% of GDP as recently as September.

The rising expenditure is primarily attributed to the ongoing war against Ukraine. Furthermore, Russia's budget plans indicate that military spending is not set to decrease significantly in the foreseeable future. In 2027, the country's military spending could surpass 17.1 trillion rubles, followed by 16.6 trillion rubles in 2028 and 16.3 trillion rubles in 2029.

Personnel pay accounts for 9% to 10.4% of the total national defense spending over the next three years. The expansion of Russia's armed forces has also contributed to the mounting budgetary strain. In September, President Vladimir Putin announced a force size of 2,441,630 personnel, including 1,550,500 servicemembers. Since 2022, the authorized military personnel headcount has increased by more than half a million.

It was previously reported that approximately 65 regions in Russia intend to cut back on investments and infrastructure programs between 2027 and 2029, as local authorities must allocate funds for social obligations, maintaining budget-funded institutions, and expenses related to the war against Ukraine.