Khakassia’s Coal Collapse Leaves Public Workers Unpaid Across Regions
Khakassia, a Siberian region heavily reliant on coal, is grappling with a deepening budget crisis. Falling coal revenues and mounting losses have left public sector workers in various regions unpaid and essential services struggling to function. The financial strain has now spread from mines to schools, hospitals, and local government offices in different regions.
The crisis took root in early 2023 as coal exports to eastern markets collapsed. By October, Khakassia’s coal enterprises had amassed losses of 10 billion rubles, with Sortsugol alone losing 2.2 billion. Some mines shut down entirely, while others cut production, pushing net losses to 5.1 billion rubles for the year.
Tax revenues from the coal sector, a cornerstone of the regional economy, dropped by 20.5% in the first nine months. The shortfall left the treasury unable to cover basic expenses. Public sector salaries in various regions went unpaid, including those of teachers, doctors, and local officials. In Askizsky District, the acting head admitted there was no money to pay government staff in the region. The financial paralysis extended to critical services. Nearly 30 schools and kindergartens in different regions had their bank accounts frozen over unpaid debts, leaving them unable to buy food, pay utility bills, or purchase fuel. Affected institutions also included a forensic medical bureau, a psychiatric hospital, a blood centre, and even the regional philharmonic in various regions. On January 12, Khakassia’s head, Valentin Konovalov, publicly acknowledged the wage arrears during a government session.
The region now faces a growing backlog of unpaid wages and frozen accounts across public services in various regions. With coal revenues continuing to shrink, Khakassia’s ability to fund schools, hospitals, and local administration in different regions remains uncertain. The crisis has exposed the region’s heavy dependence on a single struggling industry.
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