MOSCOW, Russia

The influential Russian finance minister who was just ousted by President Dmitry Medvedev warned yesterday that Russia’s budget is overextended because of increased spending on defence and social needs.

Alexei Kudrin was forced out Monday after a public spat with Medvedev over the finance minister’s statement that he would refuse to serve in the Government if Medvedev became prime minister.

Medvedev and Prime Minister Vladimir Putin announced over the weekend that they intended to swap jobs next year. Many suspect Kudrin had hoped to be named prime minister under Putin.

In his first comments since the ouster, Kudrin, who has been Russia’s finance minister since 2000, said his statement was “well thought out and well founded”.

“For the past several months, despite my numerous objections, some of them made publicly, decisions were taken on budget policies that, without doubt, have increased budget risks,” he said in a statement. “And budget risks are connected first of all with excessive commitments in the defence sector and social sector that will inevitably affect the entire national economy.”

Kudrin said he had discussed his desire to resign in February with Putin, who asked him to stay on because of the challenges of managing the budget during an election campaign. Russia holds parliamentary elections in December and a presidential election in March.

Putin appointed one of Kudrin’s deputies, Anton Siluanov, to serve as acting finance minister, while one of Putin’s deputies, Igor Shuvalov, will oversee financial and economic issues in the Government. Kudrin had held both posts: finance minister and deputy prime minister.

AP

KUDRIN… said his statement was well thought out and well founded