3 march 2011

Prime Minister Vladimir Putin holds a meeting to discuss the issue of mine safety supervision

Vladimir Putin

At a meeting to discuss the issue of mine safety supervision

“Our duty is to do everything in our power in order to minimise risks, even eliminate them completely. We do have the necessary authority, and we have the technology that is required. What we need is discipline, responsibility, effective legislation and the cooperation of owners, shareholders, employees, state supervision authorities and the courts.”

Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon, ladies and gentlemen,

I suggest we revisit the problem of safety supervision in coal mining today. The statistics show that there were 22 accidents in the industry in 2010, which claimed the lives of 135 people. The most awful accident was certainly the one at the Raspadskaya mine, in which many miners and rescue workers died. We provided the necessary support to the families that were impacted by that tragedy. But sadly, there’s nothing that can bring their loved ones back to life of course.

We had to learn our lesson, and we drew certain conclusions from this tragedy. We needed to take all the measures necessary to protect miners, improve the reliability of the mine safety systems and increase the responsibility of mine owners and managers.

We held several meetings and took a series of measures. First of all, militarised mine rescue services were transferred to the Ministry of Civil Defence, Emergencies and Disaster Relief. Second, we expanded the authority of the Federal Service for Supervision of Environment, Technology and Nuclear Management, making it directly accountable to the government.

State inspectors can now suspend operations and dismiss the heads of mining companies for severe violations before a court’s decision has taken effect. I’d like to note that in 2010 over 81,000 violations were uncovered in this industry, and over 8,000 companies and their staffs were fined.

Third, we have changed the wage system in the industry. We have to admit that the previous one posed certain risks since miners often had to ignore safety requirements. Now the fixed component of a miner’s wage cannot be lower than 70%. We have done as the miners and their union asked.

Fourth, we are revising the legislation. For example, the law on coal sets obligatory requirements for the concentration of gas at a mine. These requirements are now set by the government.

We have also amended the Tax Code. Mining companies now have an incentive to invest in safety. If they do so, the mining tax they need to pay is reduced according to the rate of the safety costs.

We have increased the responsibility for violations of safety rules. The fines for managers in mining companies and legal entities currently range from 30,000 to 50,000 roubles and from 800,000 to one million roubles, respectively. I can’t say whether one million roubles is really a large amount for a legal entity.

Anyway, we have also introduced the principle of mandatory liability insurance, making mine owners accountable for damages caused by accidents. Today we will also discuss additional amendments to the Administrative Code, which will increase companies’ responsibility for failure to ensure safety, in particular the failure to provide miners with protective equipment and uniforms. The revision of the legislation must be finished as soon as possible. I’d like to stress that trade unions should have an opportunity to review this legislation.

Today I would like to hear about the progress made on government directives for improving labour safety in coal mining.

Let’s get down to work. I’d like Igor Sechin to take the floor. Mr Sechin, please.

Igor Sechin: Mr Prime Minister, as a follow-up to the meetings you held in Novokuznetsk on May 11 and June 24 of last year and the presidential directives on the relief efforts at the Raspadskaya mine, a total of 80 directives were issued.

Seventy-eight of them have been executed so far. First of all, I would like to speak on the social aspects of the directives and on the most important ones. In accordance with your directives, the federal government has provided a total of 122.8 million roubles to the injured and the families of the victims of the Raspadskaya accident.

In addition to this, the government of the Kemerovo Region and the mine owners covered rehabilitation courses for the families affected by the tragedy, organising trips to resorts for them.

Vladimir Putin: Did the common-law wives receive the money?

Igor Sechin: According to Mr Aman Tuleyev [Kemerovo Region Governor], this issue has been closed.

Aman Tuleyev: Yes, it has.

Vladimir Putin: So you’ve paid it out?

Aman Tuleyev: Yes, we have. We have paid the money to all of them.

Vladimir Putin: Good.

Igor Sechin: As you said, on the whole, we have finished revising the wage system in the industry. In particular, we have reached an agreement with mining companies to raise the fixed component of a miner’s wage to 70%, setting it forth in the legislation. This measure is intended to eliminate the need for miners to ignore safety standards in order to increase production.

Following up on your directives, we also resolved the issue of employing the mine’s staff  while operations are suspended as the mine is being reconstructed. We also executed all the directives on reconstruction. The federal government allocated 1.7 billion roubles to build new transformer stations in order to ensure stable power supplies to the mine.

We have done a great deal to revise the legislation and technical regulations pertaining to engineering design, construction and the repair of mines and coal pits. This work is still well underway. These documents were developed back in the Soviet times and need to be overhauled as coal production grows due to the adoption of new technology. According to experts, a total of 4,000 documents need to be rewritten.

As you said, a series of critical legal acts have been developed recently in order to strengthen the industry and ensure mine safety. To this end, we have adopted five federal laws, in particular the law on mandatory liability insurance for the owners of potentially dangerous facilities, which sets forth the terms of the payment of damages in case of an accident. The legislation also includes the amendments to the Administrative Offences Code, the federal law on safety in manufacturing industries, article 114 of the federal law On the State Regulation of Coal Production and Use, and so forth.

We are developing a package of bills intended to improve the current legislation in order to strengthen the system of industrial safety management and occupational safety in mining.

We are finishing the execution of seven directives, including one presidential directive, on measures to revise the legislation in the industry. In particular, we are drafting a law setting requirements for the concentration of gas at a mine and making the degasification procedure obligatory.

Other government directives, which are currently being executed, include the directive on the construction of three kindergartens in the Kemerovo Region and a hospital complex in Mezhdurechensk; the development of a long-term programme for the mining industry up to 2030 (a draft has been coordinated with federal executive bodies and their regional branches; the draft is being further refined following the proposals of the Ministry of Industry and Trade, the Ministry of Healthcare, the Ministry of Education and Science and the Federal Service for Supervision of Environment, Technology and Nuclear Management); amendments to the Urban Development Code of the Russian Federation on engineering design documentation for the construction and reconstruction of coal mines and pits and coal washing plants; the development of a subprogramme for the provision of protective equipment and uniforms and the further development of life support systems in mines; the creation of a national training centre for miners and rescuers; rules on handling emergencies, the use of protective equipment and safety training.

We held a series of discussions ahead of this meeting to see which issues need our special attention and stepped up our efforts to expedite the execution of four government directives on the drafting and amendment of the legislation. We took into account the position of coal mining companies – the new legislation stipulates that only one company can operate at a mining site. This eliminates unnecessary competition and makes it clear which company is responsible for developing a particular coal-bearing layer.

The directives I mentioned include the one on finalising the government resolution on engineering design documentation for new coal mines. We reviewed the issue of reducing the time frames of processing such documentation by the state, with an understanding that it must factor in every specific feature of coal mine construction. Another directive I’d like to touch on is the one on drafting a government resolution on amending the current resolution on basic requirements for licensing companies to operate at highly dangerous construction sites. After a series of consultations with coal mining companies we concluded that it is necessary to centralise the oversight of occupational and industrial safety, developing and executing a programme to improve safety in mining.

The government will continue to supervise the execution of all these directives. Everything will be done to the letter. I’d also like to add that we are developing a search and rescue system for the industry. Currently, we are reviewing best international practices. We haven’t made a final decision on this issue yet; the Siberian Coal Energy Company is testing various systems at its mines, including Raspadskaya. We will continue this work until we find a really good solution to this challenge.

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Ivan Mokhnachuk (head of the Russian Independent Coal-Mining Union): As far as occupational safety is concerned, I’m glad we have raised this issue. The trade unions believe that it is one of the most critical problems. A coal miner’s health and life is our absolute priority.

We are deeply concerned over the deteriorating situation at the mines of the Russian Coal company, in particular in Gukovo. Unfortunately, 10 miners died this year. Six died in mines under the ground. Four of them worked in the Gukovo area: three at Gukovougol and one at Vostochnaya. I’d like to note that this mine is considered relatively safe. This trend is very alarming. I think the situation is aggravated by a quick turnover of mine managers. For example, the directors of the Gukovskaya mine changed seven times this year alone. Some of them were appointed twice. It is inadmissible.

In 1993 the Council of Ministers issued resolution No. 722, if I’m not mistaken, setting requirements for a mine’s management. A person could not be appointed a mine’s director unless he or she had worked in the industry for at least five years. A director was to have very substantial experience. Unfortunately, some of the directors appointed now don’t have the slightest idea… Clearly, businesses and owners try to tackle the challenges facing mines but they don’t really understand what is happening in the industry. Previously, a director had to descend into his mine at least six times, including two times during a night shift, but this requirement has been cancelled.

Clearly, inadequate personal control undermines discipline and under these circumstances supervision authorities can toughen control of the industry. We understand that it is free business and mine owners can address problems the way they want, but we could offer our recommendations so as to improve the situation. We should all remember that a mine is a highly dangerous facility.

The industry is facing a really serious management problem. The Federal Service for Supervision of Environment, Technology and Nuclear Management has intensified its efforts, and we see it since we are in close contact with mining inspectors in all regions. And I am very grateful to Mr Nikolai Kutyin [head of the Federal Service for Supervision of Environment, Technology and Nuclear Management] for this. However, the problem is that very few employees of a mine want to become its director since they understand how big the responsibility for people’s safety is. We need to somehow achieve a happy medium here, setting forth certain requirements.

I have one request. First of all, I’d like to thank Mr Gennady Kozovoi [General Director of the Raspadskaya Coal Company] and Mr Aman Tuleyev. In Kuzbass, all housing and social security issues have been resolved on the whole. But there is this old problem, the relocation of the miners’ widows from Vorkuta and Inta. This problem has dragged on since the Soviet times. I would like to ask you to meet with these women, if possible. Two of them are currently in Moscow.

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Prime Minister Vladimir  Putin’s closing remarks:

The work we do is extremely important since we address the problems faced by a critical energy sector, where risks have always been very high.

Our duty is to do everything in our power in order to minimise risks, even eliminate them completely. We do have the necessary authority, and we have the technology that is required. What we need is discipline, responsibility, effective legislation and the cooperation of owners, shareholders, employees, state supervision authorities and the courts. They all can work together for the common good. That’s the only way we can achieve real results and ensure the protection of the life and health of miners.

Today we have reviewed the preliminary results of our work and discussed what needs to be done next. Everything we mentioned must be done. At the end of the year we will return to this issue again.