Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon, ladies and gentlemen. One of our colleagues is celebrating his birthday today. Mr Trutnev (addressing Minister of Natural Resources and Environmental Protection Yury Trutnev), you are celebrating your 55th birthday. Allow me to congratulate you and award you the Stolypin Medal, 2nd Class. We all congratulate you and wish you all the best.

Moving on, let's discuss recent events. I and many of those present here visited Brussels recently, where we met with our European counterparts and discussed many aspects of Russia's cooperation with Europe. I would like to point out that Europe is Russia's leading trade and economic partner. Hence many issues arose that require consultations, solutions, and compromise.

One of the issues we raised was industrial scale car assembly (a manufacturing designation involving a set of requirements on domestic assembly). February 28 was the last day that foreign car manufacturers could come to a consensus and sign memorandums of agreement related to new conditions for the industrial scale assembly of automobiles in Russia. As far as I know, Toyota and Sollers have agreed to expand their cooperation in Russia's Far East today. These two companies intend to set up a new production facility. Ms Nabiullina, how is this work being done?

Elvira Nabiullina: Indeed, the negotiation period expired yesterday. It lasted one month, during which companies were to state they were interested in adhering to the new manufacturing requirements of industrial scale car assembly. It is worth mentioning that almost all major car manufacturers expressed an interest in this new model, and six agreements of intent have been signed so far... These include an agreement between the Volkswagen Group and Avtovaz to use the facility in Nizhny Novgorod for the manufacture...

Vladimir Putin: One of Volkswagen's top executives – the head of Volkswagen, to be more precise – would like to have an additional meeting to discuss the details. Please bear this in mind and raise this issue with him.

Elvira Nabiullina: Yes, we have been discussing the details and many questions were asked. Initially, we amended car assembly regulations so that facilities with a greater level of localisation would be established in Russia. And many car manufacturers responded positively. These include the Sollers-Ford company. There is also a multilateral agreement between Avtovaz, Renault-Nissan, IzhAvto, Kamaz, and Mercedes-Benz. They are planning to manufacture motor cars and trucks. The FIAT Group is working on its own. General Motors and Magna...

An agreement of intent has been signed. We expect these companies to submit specific business plans by June 1 detailing investment volume and schedule as well as schedules for upgrading existing facilities and building new ones. We are working on it.

This new procedure has also sparked interest of automotive component manufacturers. We have received applications from 206 companies willing to establish automotive component facilities in Russia with an expected localisation level of 40%. That's why we say that this new system has sparked interest. We will be working on specific agreements with these companies later on.

Vladimir Putin: I request that you keep in touch with our counterparts from the European Commission so that they remain informed of what we are doing in this sphere and we can make certain adjustments in order to create favourable and equitable conditions for all.

Mr Fursenko, we held a meeting with students in Sochi recently... We could make some adjustments together, if necessary, so as to create a level playing field on our market.

Mr Fursenko, you and I recently met up in Sochi with leaders of student public organisations and trade unions from all across the country. They brought up a number of issues, which, in my view, are absolutely valid and well thought out, and we pledged to respond to them somehow.

Could you please comment on several key points here? And, second, I'd like you to comment on a newly signed resolution concerning government awards for young researchers who work in the field of science and technology.

Andrei Fursenko: Let me start with the prizes, which are to be awarded on a competitive basis to young professionals who make outstanding achievements in science and technology.

Of the 47 entries, 9 made it into the second round. Following detailed deliberations over the shortlist, the selection panel picked out 7 finalists. These are research teams, most of them composed of four junior scientists working under the guidance of an (established) counterpart.

Their research areas vary. Biotechnology is, perhaps, the most interesting. One of the projects submitted is in veterinary medicine and deals with methods for combating swine plague. There's also an interesting project on new construction techniques.

The geographical distribution of candidates is also fairly wide, with winners coming from Moscow, Krasnoyarsk, southern Russia, and so forth. Their seven project proposals are all highly promising.

Vladimir Putin: How much is the prize?

Andrei Fursenko: The prize fund is 2 million. Now I'd like to pass on to other issues, if I may. Those we discussed...

Vladimir Putin: ...with students in Sochi?

Andrei Fursenko: Exactly. So, first of all...

Vladimir Putin: Wait a second. You said some new methods of combating swine plague have been proposed, didn't you?

Andrei Fursenko: Right.

Vladimir Putin (addressing Viktor Zubkov): Mr Zubkov, have you heard anything about this? Try to find out more, will you?

Viktor Zubkov: Yes, Sir.

Vladimir Putin: We should make sure that life and science go hand in hand rather than each going its separate way, as is so often the case.

Andrei Fursenko: This (project proposal) comes from an institute under Mr Zubkov's watch, the Russian Agricultural Academy.

I'd like to raise two issues for which solutions have already been found. The first has to do with scholarships. Mr Putin, you highlighted the importance of student involvement in the process of determining scholarship distribution methods as well as in the distribution itself. We've agreed with the Association of Major Universities (which includes St Petersburg University, the University of Moscow, eight federal universities, and 27 regional universities) that the additional allocations they've received from the treasury will be passed on to student boards for distribution as scholarships.

Key distribution guidelines shall be determined by September 1 and are intended to serve as the basis for a new methodology, which will be elaborated over the remainder of the year with due consideration of the student boards' proposals. If the deliberation process proves efficient enough, we'll propose that it should be applied as of January 1, 2012 in all Russian institutions of higher education.

The men and women that we met, members of organisations and trade unions, student boards, and, significantly, the Association of Major Universities (university chancellors, that is) are unanimous in supporting this idea to delegate the responsibility of scholarship distribution to the student boards.

Vladimir Putin: Mr Kudrin, at the time of that meeting we had with the students, you and I agreed in principle that student stipends should be raised by at least 9% as of September 1 of this year. I'd like you to keep an eye on inflationary tendencies so that we can stick to our pledge to raise the payments by at least 9%. We'll make our final decision depending on the current economic situation and the rate of inflation. But this prospective rise cannot be under 9%.

Andrei Fursenko: The second issue they [the students] brought up had to do with mobility. They suggested organising at least 500 visiting student programmes – say, for the next academic year – to provide an opportunity for university students from across the nation to spend at least a semester studying in one of the country's leading universities.

Our ministry could cover visiting students' travel expenses, while the host universities would provide them with accommodations and help them integrate into the academic process.

Such programmes could help Russian universities foster links with their counterparts all over the country, integrating them into a common academic landscape. We think we'll expand the practice if it proves efficient. This will be our first step and will serve as a springboard for further advancement.

Vladimir Putin: Ms Nabiullina, the Finance Ministry and the Ministry of Economic Development should see how the situation unfolds from now until September. Your decision on student stipends should correspond to those of other public sectors. So keep a close eye on it.

The government has also signed a resolution on bonuses for social workers. This document provides for the payment of one-time bonuses worth 500,000, 300,000, and 200,000 roubles.

(Addressing Vladimir Belov, Deputy Minister of Health and Social Development) Mr Belov, please have your say.

Vladimir Belov: Yes, Mr Putin. Russia's 637,000 social workers provide services for 26 million people annually, including 15 million disabled and elderly people. This is a highly demanding job that brings few rewards. Yet, the need for social services among the elderly and the disabled remains very high. We believe that the prestige of this profession could be raised by offering material incentives, such as bonuses for exemplary work and national awards for the best social worker. There are 20 nominations, three winners in each, so sixty can get the award at a time. The top prize could be 500,000 roubles, with 300,000 for second-place finalists, and 200,000 for those who come in third. Some 20 million roubles has been earmarked for this purpose in the federal budget.

The best social worker awards should become an annual event, with the award ceremony to be held on June 8, observed as Social Worker Day in Russia.

Vladimir Putin: When do you intend to start preparations for the competition?

Vladimir Belov: I think we'll get down to work as soon as the resolution is signed. We've got 637,000 social workers...

Vladimir Putin: The resolution has been signed today. Could you get started tomorrow?

Vladimir Belov: Sure.

Vladimir Putin: Alright, then it's a deal.

Mr Trutnev, could you report on the construction of the first leg of sewage facilities in St Petersburg and the surrounding region?

Yury Trutnev: Mr Prime Minister, we have submitted a draft resolution for a 42 million rouble grant to St Petersburg in addition to a co-funded 30 million rouble package intended to continue the construction of a facility for processing industrial waste. The city can now afford to dispose of toxic waste in compliance with Russia's obligations to the Helsinki Convention on the Protection of the Marine Environment of the Baltic Sea Area.

Vladimir Putin: What waste do you mean? Where is it coming from?

Yury Trutnev: From St Petersburg's industrial enterprises.

Vladimir Putin: St Petersburg's industry is stretched to the breaking point. Please monitor the project and report on construction as it proceeds because it really is of critical importance.

Yury Trutnev: I see.

Vladimir Putin: Tensions are high in some places, as we know – built up over years, even decades. So we need to do this now.

Yury Trutnev: A huge amount of waste has been stockpiled.

Vladimir Putin: Really? Now, let us say a few words about the agenda. Colleagues, we discussed the implementation of our demographic policy two weeks ago, and, in particular, we mentioned the establishment of additional tax preferences. Let us begin our work today by addressing the support of families with multiple children.

Relevant amendments to the Tax Code have been drawn, as we agreed, and will be submitted to the State Duma.

I'll briefly go over our proposals, just to jog your memory. First, these amendments call for a differentiated approach to tax benefits. At present, we have flat benefits of a thousand roubles a month per child. After the law is adopted, benefits for families will increase according to the number of children. Thus, parents and guardians bringing up two children will have a 2,400 rouble monthly benefit, which increases to 5,400 roubles for three children. Families with four or more children will have a 3,000 rouble benefit for each child, starting with the fourth. Both parents or both guardians will be entitled to the benefit. If there is only one parent or guardian in a family, he or she will receive double the benefits, as justice requires. Benefits will also double for families with children who have health problems. Parents will be entitled to tax benefits until their children reach 18 years of age or 24 years of age for full-time university students.

I repeat once again that we must seize every opportunity to reinforce positive demographic trends and support families with children. Every aspect of this work is important, including the creation of new jobs, a flexible tax policy, and the development of healthcare and education. It is our duty to address all these problems, and we will continue to place them among our top priorities.

Another item on our agenda concerns amendments to the law on mineral resources and is intended to promote mining businesses and allow them effective opportunities for the thorough development and rational use of resources.

First, we are removing excessive administrative barriers to allotting mining plots at deposits of local significance. This implies the simplest road and housing construction materials – pebble, clay, limestone, chalk, sand, and gravel. Such materials are in great demand for large-scale construction works, particularly on federal and regional housing projects and infrastructure programmes, so they imply urgent decisions. The new amendments list local deposits and stipulate an explicit and transparent procedure for licensing their development.

Second, detailed surveys of active fields often identify their geological characteristics and reveal new deposits. Under the present arrangements, plot boundaries can be changed only after auctions or bids. So businesses get into a vicious circle after they invest in the development and appraisal of their own deposits and have to increase their capitalisation. Now, we will allow them the approval of new boundaries while bypassing auctions and bids, thus removing a great deal of bureaucratic barriers. As a corollary, the individual or company will have only to pay a lump fee for the involved administrative process.

We say a lot – and on good grounds – about instilling a civil and patriotic spirit in our citizens, especially the youth. This is also one of the themes on today's agenda. Love for and responsibility to the Fatherland begin with reverential attitudes towards national history and to the memory of those who died on the battlefield for their people and their native land. We have done maintenance on all monuments of martial glory for the 60th and 65th anniversaries of the victory in the Great Patriotic War. It is our sacred duty to preserve these monuments in an admirable state. Certainly, regional and municipal authorities bear a great share of this responsibility.

I would like to note that there are more than 22,000 Soviet soldiers' graves located in more than fifty foreign countries. We have raised their maintenance to the level of bilateral relations, with relevant international agreements made. In an overwhelming majority of instances, our partner countries maintain the graves of fallen Russian and Soviet soldiers in excellent condition. Our partners deserve our gratitude for their reverential memory of our soldiers, who died in defence of our Fatherland and for the liberation of Europe from Nazism. We make annual allocations for the maintenance and improvement of our soldiers' graves abroad.

You are aware of the noble work of search teams who detect fallen heroes' names and rebury them with honours. Such teams are active in many countries on the Baltic coast and in Eastern Europe. We are grateful to them for their respect for the memory of our soldiers. I think we should, in our turn, assume all financial and organisational duties related to the honourable reburial of our soldiers whose remains have been unearthed by foreign search teams. Accordingly, we should make relevant amendments to the law on tribute to the memory of soldiers fallen in the defence of their Fatherland. We will discuss this theme today.

Let us start our discussion.