Describe formation of environmental funds.

The governmental decree “On the Creation of Nature Protection Funds” (1993) established a system of environmental protection funds, which were consolidated into the state budget in 1994. In 1998, environmental protection funds were established again by a new decree, “On the Creation of Environmental Protection Funds.” Altogether, 16 regional and one national fund were created. At the end of 1999, the situation changed again, when the governmental law “On Republican Budget for 1999 with Amendments and Supplements” ordered that all extrabudgetary funds at national level should be closed. When asked for the reason of this decision, Kazakh officials stated that this was a recommendation from the IMF. Therefore, currently there are 16 regional environmental funds (in Astana and Almaty, and in the 14 oblasts), but no national fund, and all national financing is via the state budget. Some environmental payments are collected directly to the state budget, which means that they do not pass through the system of funds. These include all excise duties, royalties, bonuses and excess revenue payments for use of mineral resources, national payments for production sharing agreements and payments for the use of animals. Pollution payments, payments for land renting, administrative fines and penalties for illegal hunting are divided between regional and state budgets in a certain proportion, which is defined in the legislation. The division of environmental payments between the State and local budgets has been amended many times. Until 1997, local budgets received 85% of collected funds and the state budget 15%. In 1997, the situation changed, so that 70% of the collected payments were given to the local budgets and 30% to the state budget. In 1999, it was ruled that 50% of the collected charges go to the state budget, and 50% to the local budgets.The 1997 law “On Environmental Protection” states that “…the use of payments, collected by the environmental protection funds, for purposes not connected with environmental protection, is forbidden…” (Article 34). However, most of the money accruing to the state budget from environmental payments is used for other than environmental purposes. A similar situation prevails with the    

27. Give explanation to environmental insurance and licensing, selling the rights to pollute. It is planned to undertake a pilot project to introduce this system in large enterprises and regions. Draw up a list of enterprises and objects (in the main branches), which will insure its liability based on the level of environmental risk, and based on standards developed by the compensation for environmental damage. By 2015, it is planned to develop a system of insurance risks in the field of environmental protection to implement it across the country. This in turn will require the improvement of mechanisms of environmental risk assessment, assessment of damage, identify responsibility, elimination of consequences of accidents and compensation for damages. It is expected that the introduction of liability insurance for environmental pollution will be implemented in 4 stages/ First of all, necessary to create the appropriate legal and regulatory framework of the insurance of civil liability for environmental pollution. It is expected to add a provision on 'civil liability insurance for environmental pollution "in the regulations of the national and local level. When all necessary conditions will be created, it is planned to adopt a special law on environmental liability insurance./Secondly, it is necessary to establish that the subject of environmental insurance are mostly direct losses caused by environmental pollution. The first pilot project will be conducted in industries and regions, enterprises, where as a result of incidents involving pollution has suffered the greatest environmental damage and where there is a high potential for such incidents. While other companies may carry out pilot projects voluntarily. A detailed diagram of the pilot projects will be developed by the authorized bodies in the sphere of environmental protection and insurance regulators./Third, the environmental authorities, insurance regulators and insurance companies have their own areas of responsibility within the framework of pilot projects. Environmental authorities are preparing a list of enterprises to participate in the pilot project and standards of compensation of environmental damage. Insurance companies are preparing proposals for the insurance of civil liability for environmental contamination, determine the area of ​​responsibility and the amount of insurance premiums according to the different types of risks. Regulatory authorities in the insurance industry develop appropriate regulations for the introduction of the insurance system and the regulation of this segment of the insurance market./Fourth, environmental and insurance regulators should establish the mechanism and rules of investigation of environmental incidents and identify responsibility, the standard procedure for compensation for damages and bringing the system information on incidents. It is expected that the introduction of environmental insurance will provide institutional support to the introduction of energy saving, reduction of harmful emissions.

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