Coining lies. Kremlin spends 1.5 Billion per year to spread disinformation and propaganda

In democratic countries, media is referred to as “the fourth estate”. However, this term does not apply to Russia, where the media is subordinated to the only power - the autocratic rule of Vladimir Putin. Tripled spending on from the budget on mass media in the first quarter of 2022 signals that Kremlin’s efforts to support its narratives against the backdrop of the war in Ukraine are only growing. Therefore, in this article we dissect which outlets are the main cogs in Russian state propaganda machine and how much money has been poured into them.


This article was written by DebunkEU.org analysts Aleksandra Michałowska and Jakub Kubś.

 

Summary

  • More than 1.5 billion USD (115 billion RUB) were allocated from the Russian state budget on mass media in 2021.

  • In January - March 2022, spending on mass media from the Russian state budget has tripled (compared to the same period last year).

  • Funding of Rossiya Segodnia, information agency owned by Russian government, significantly grew after Russia invaded and annexed Crimea, and started the war in Donbas in 2014.

  • Two of the most funded outlets are the externally oriented RT and the domestically oriented VGTRK (All-Russia State Television and Radio Broadcasting Company). Together with Rossiya Segodnia, they receive more than half of the annual funds provided for mass media in Russia.

  • The current trend indicates that spending on mass media from the Russian state budget this year will significantly exceed the planned.

 

Since 2014, the Kremlin has been building a powerful structure to monitor and produce content creating the desired image of the Russian president and his regime. Contemporary Russian propaganda uses techniques from the Cold War era, adapted to the new reality and exploiting the potential of technology and mass media in ways that would have been unthinkable in Soviet times [1]. Propaganda machine is formed by an extensive network of media channels, financed both by the federal and regional budgets. Thus, one of the most important measures of Russia's propaganda effort are the funds allocated by the Kremlin for the operation of mass media, including individual news agencies.


Lack of fiscal transparency makes it difficult to track budgets and expenditures of main Russian propaganda media channels, which leads to the fact that some data vary widely.[2] The information for this report was obtained from official channels of the Russian government, press releases, and sites collecting statistical data.


When writing about Russian propaganda, it is important to note that it has two main objectives: external and internal. For domestic use, media is intended to sustain support for Putin’s regime, general acceptance for war and mental preparation for the hit of Western sanctions. The external use is to follow the Russian propaganda playbook of four D’s: dismissing, distorting, distracting, dismaying for foreign audiences the real image about the war and atrocities committed by the Russian army in Ukraine.[3]


General funding


Over the past ten years, there has been a steady increase in media funding in Russia from the state budget. In 2011 mass media became a separate sector financed from the state budget (previously they were part of the 'Culture, cinematography and media' sector). The data in the graphs are presented both in rubles and US dollars, to show a more quantifiable picture of mass media funding.[4] The exchange rate of the ruble against the dollar was converted for January 1st of a given year using the OANDA currency calculator.[5] It is worth noting that the funding of mass media in Russia is a small part of the federal budget, on average about 0.5% per year. Although the percentage of funds allocated to mass media is relatively small, it should be emphasized that these are still very large sums of money.


At the outset, it should be noted that finding reliable information on the funding of individual media outlets in Russia is a challenging task. Detailed information about the allocation of money to individual entities is withheld, which was the subject of objections from independent journalists as early as 2000.[6] Moreover, as a rule, the appropriations reported in the draft budgets for subsequent years are significantly lower from those actually allocated.[7] The graph below showcases Russia’s state budget allocations to mass media in general since 2011 [8].


General funding (RUB)

General funding (USD)

There is a noticeable steady increase in spending from the state budget on mass media. From 2011 to 2022, it was almost 30%, at its peak - almost doubling. State expenditures on the mass media constitute around two per cent of the total federal budget. It should be noticed, that the growing level of the expenditures since 2018 was justified by the promotion of a major international sports event that took place in Russia and transition to digital broadcast.[9]


The key state program, “Information Society”, according to which the money was distributed to media holding, was designed for the period 2011–2020, which explains the reduction of the means from state after this year. The state continues its donations to media agencies either in the open form or bypassing the officially stated budget to keep the same level of production, when the demand for advertising decreases and the audience’s expectation grows.

The increased need in manipulating public opinion due to the war in Ukraine has been reflected in the resources allocated by the federal government to the mass media. In the period from January to March 2022, spending from the budget on mass media was more than tripled compared to the same period a year earlier. In March, when hostilities were taking place, the budget allocated 11.9 billion rubles for mass media – twice as much as the funds allocated in January and February combined (5.5. billion rubles).[10]

Although the federal budget proposal for 2022 prognosed a 4.1% increase in rubles in media spending over the previous year,[11] the current trend indicates that spending on mass media this year will significantly exceed the planned.


Rossiya Segodnya


Rossiya Segodnya (Россия сегодня) is an information agency owned by Russian government and founded on 9th of December 2013 by Putin's decree on “increasing the level of efficiency of state mass media”.[12] The agency was created to replace RIA Novosti and the Voice of Russia radio station (in existence since 1941), which were both closed down by the same decree. Although according to the statement of the head of the Administration of the President of Russia Sergei Ivanov, “the decision to close the news service was part of an effort to reduce costs and make the state news media more efficient”,[13] a report published by RIA Novosti commenting on the decision suggested that it was part of a series of changes in the Russian media landscape that “appear to point toward a tightening of state control in the already heavily regulated media sector”.[14]


According to the secretary of the Russian Journalists' Union, the reorganization of RIA Novosti was influenced by the course of events of the Ukrainian Maidan, which were unfavorable for the Kremlin, and was aimed at consolidating the propaganda machine.[15] A TV presenter Dmitry Kiselyov was appointed as chairman of Rossiya Segodnya. Once considered to be one of the most respected and credible journalists in Russia, in 2012 Kiselyov transformed into an ardent “propagandist” and since 2014 is a subject to individual EU sanctions.[16] Entities owned and operated by Rossiya Segodnya include among others Sputnik (which, along with RT, is one of the key channels of Kremlin propaganda with global reach, directed abroad), RIA Novosti and inoSMI. According to the monitoring company Medialogia, in 2022 RIA Novosti was one of the top three most cited and thus influential news agencies in Russia.[17]

The agency has seen a steady increase in state funding, with the amount of funding doubling since 2014 (change from RIA Novosti to Rossiya Segodnya) to 2022.
Funding of Rossiya Segodnia (RUB)

Funding of Rossiya Segodnia (USD)

It is clear that since 2014, when Russia occupied Crimea and began the war in Donbas, the amount in federal budget funding for the agency increased significantly. While it can be argued that the increase in funding was due to the 2014 Sochi Olympics, the boost in federal budget spending on propaganda media agencies in general has steadily continued in subsequent years. The increase of financing for Rosiya Segodna and other propaganda media is a clear sign of participation of these agencies in the information war – waged parallel to the military one. It is worth to note that the increase occurred despite the sharp devaluation of the ruble and the deep economic crisis in Russia in 2014-2016, which has affected the state’s economy.


VGTRK


The All-Russia State Television and Radio Broadcasting Company (Vserossiyskaya gosudarstvennaya televizionnaya i radioveshchatelnaya kompaniya; VGTRK) is Russia's largest state-media holding. Founded in 1990 and based in Moscow, VGTRK operates five national television channels, including Russia-1 (Россия-1), Russia-24 (Россия-24) and Russia-K (Россия-К), two international networks, five radio stations and more than 80 regional television and radio networks. It also runs the information agency Rossiya Segodnya (managing RIA Novosti, Sputnik, and other structures).


It should be stressed, that the strict control of broadcast television has been a key element of Putin’s regime. According to the survey conducted by the Levada Center in January 2020, television serves as the primary news source for 73% of Russians (average person watches TV 3,5 h per day), while the Internet is the primary source for 39%. Simultaneously, 52% of Russians say they trust television news.[18] As the vast majority of Russians continue to get most of their information from TV, VGTRK is a regime’s powerful tool for shaping public perceptions.

According to the former employees of the media holding, Kremlin officials dictate to VGTRK management and editors how news events about the war in Ukraine should be covered, what keywords to use to discredit Kyiv and what experts to invite to the studio. Top editors had been mobilizing employees to take part in the new “Cold War” at least since 2014, when Russia has started the occupation of the Crimea.[19] According to Leonid Krivenkov, former camera operator of Russia-24, VGTRK journalists acknowledge that they are part of a propaganda machine distorting reality - the favorite joke told by the moderators to news presenters is “now it’s your turn to lie.”[20]

Funding of VGTRK (RUB)

Funding of VGTRK (USD)

Although VGTRK is currently the second media agency receiving the largest federal funding, with approximately two-thirds more funding growth in this current period than in 2010, the value of federal funding measured in dollars has declined significantly. In 2022, the value of federal grants for VGTRK from the federal budget measured in US dollar reached its lowest level during the analyzed period. The lack of an increase in funding to compensate for the declining value of the ruble can be explained by the increase in state budget allocations to other media agencies, primarily RT.


RT (former Russia Today)


RT is a Russian media agency and political influence tool, designed to spread disinformation and undermine Western values around the world.[21] The agency was founded by the Autonomous Non-profit Organization TV-Novosti (ANO TV-Novosti) in December 2005 with support from the then existing RIA Novosti agency. It is now a wholly state-controlled multilingual network of television stations, websites, and social media channels.[22] Currently, RT operates in six languages (English, Spanish, French, German, Arabic, and Russian) and its message is primarily aimed at non-Russian speakers.[23] In 2009, editor-in-chief Margarita Simonyan concluded that news about internal events in Russia did not generate enough interest from viewers, so RT changed its profile to international and domestic events in the U.S. In addition, it rebranded and changed its name from “Russia Today” to RT “to stop scaring away the audience”.[24] The enormous reach of RT, especially online, should be noted as well (e.g. YouTube channel of the agency reached up to 3 billion views (compared to 1.8 billion of Al Jazeera in English).[25]

RT clearly leads the way when it comes to media funding from the state budget in Russia. Over the past 12 years, the funds allocated to the agency almost tripled. According to the federal budget for 2022, this year RT is to receive 25% of all funds for mass media.

The agency has a privileged position in the state funding – in 2012, Putin banned the reduction of RT funding,[26] while ANO TV-Novosti (RT’s parent company) does not submit mandatory expenditure declarations, which, however, does not result in any consequences for the organization.[27] The privileges in the area of financing testify to the special status that RT has in the Kremlin propaganda system. Already in 2007, Andrey Illarionov, a former Putin adviser (now an opposition figure) stated that RT is “the best Russian propaganda machine targeted at the outside world”.[28] In 2012, referring to the Russian-Georgian war, Simonyan stated that RT can be compared to the Russian Ministry of Defense.[29]


Funding of RT (RUB)

Funding of RT (USD)

Notably, in December 2013, Simonyan was also appointed editor-in-chief of Rossiya Segodnya.[30] Despite this and the fact that ANO TV-Novosti was founded by RIA Novosti (transformed into agency Rossiya Segodnya in 2013), RT denies any associations with Rossiya Segodnya.[31] During the war in Ukraine, on April 15th Simonyan demanded the introduction of censorship in Russia and cited China as an example of a country in which the desired conditions of “political and informational life” prevail.[32]


ZVEZDA


Zvezda (The Star) is a successor of the official newspaper of the Soviet armed forces, Krasnaya Zvezda (Red Star). It is Russian state-owned nationwide media network run by the Russian Ministry of Defense. Zvezda broadcasts television programs, produces online stories and radio programs related to primarily military, but also political and social affairs.


Zvezda has clear political objectives – it is a propaganda tool with a clear ideological component.[33] It describes itself as “patriotic” and is considered one of the most sensationalist and anti-Western media outlet[34]. The Ministry of Defense launched Zvezda channel in 2005 as a modest undertaking, which in 2009 became the core of a fully-fledged television and radio broadcasting network.

As political scientist Pavel Luzin concludes: “a typical Zvezda viewer is somebody who feels uncomfortable with the realities of modern Russia; somebody who is afraid of projecting their hopes onto the future and, due to this passivity, takes refuge in the past”. Such a profile of recipients makes it difficult, if not impossible, for the medium to effectively spread propaganda and shape the awareness of citizens.

The most popular content broadcast over Zvezda are movies about World War II, which not only illustrates the importance of Soviet nostalgia to the channel’s appeal, but also that its audience is attracted to Zvezda primarily for the entertainment content from those “glorious times.”


Funding of Zvezda (RUB)

Funding of Zvezda (USD)

In 2016 Zvezda’s financial performance has deteriorated noticeably. In 2019-2020 it has received quite generous subsidies to amount of 2.1 billion rubles each year with similar subsidies from federal budget in subsequent years. However, despite assistance from the state, Zvezda has proven unable to become either a successful media outlet or an important instrument of propaganda within Russia. In general, Russian military media outlets do not play significant role in the field of PR or propaganda in the wider societal context, even though they play a role in communicating the political line of the Russian leadership to military personnel.[35] Although Russian Defense Minister Sergei Shoigu has described the media as a type of weapon [36], the media outlets of Russian army seem to be quite useless in the struggle for shaping Russian minds.


Conclusions


The funding for state news agencies in Russia is increasing. The sharp increase is especially visible in the financing of information structures serving the interests of foreign information influence, like RT. Although in 2010 the funds allocated to the largest media holding in Russia, VGTRK, exceeded funding for RT by more than three times, since 2015 a steady equalization between VGTRK and RT can be observed, while since 2020, the latter has received the highest funding of all the agencies of the Russian Federation, becoming the main media pillar of the Kremlin's propaganda focused on the foreign audiences.[37] As mentioned, placing emphasis on shaping external opinion about Russia and its actions, promoting Kremlin narratives outside the country has become a priority task in connection with the armed aspect of information and information warfare. The change that has occurred in the distribution of media funding from the state budget since 2010 can be illustrated by comparing all three analyzed agencies.


Comparison of funding received by VGTRK, Rossiya Segodnia, and RT

In turn, as the graphic below shows, the sources analyzed in the article raise about half of the total available budget for mass media. Taking into account that these are only three agencies, the sums they obtain are very large and increase in the periods of high international tensions (war in Donbass, annexation of Crimea), proving that VGTRK, RT, and Rossiya Segodnya are the basis of the Kremlin's media propaganda.


Split between the top media and other outlets

In the next two years, according to the draft budget, RT will be allocated 28.467 billion in 2023 and 28.983 billion rubles in 2024, compared to 28.695 billion rubles in 2022. VGTRK, which will receive 25.217 billion rubles this year, is supposed to receive another 25.332 billion and 25.761 billion rubles in the subsequent two years. On the other hand, while in the current year Rossiya Segodnya receives 9.356 billion rubles, in 2023 and 2024, the authorities plan to allocate another 8.297 billion and 8.556 billion rubles to the agency. [38] In total, these three agencies solely receive more than half of the annual funds provided for m