Transcript of the beginning of the meeting:

Vladimir Putin: We have already discussed in depth the current situation in the republic. I would like to stress that since my first visit to Saransk the city has been transformed. It looks like a different city and it is constantly growing. All the credit for that goes to the people of the republic, as I can see from the development plans and their implementation under your supervision and with the support from the federal budget. I can see the situation is changing for the better. However, there are always new social and economic issues that arise in everyday life. Which of them do you think are the most crucial at the moment?

Nikolai Merkushkin: The damage caused by the draught is very relevant now. We have received support from the federal budget but it was a heavy burden for our local budget. There are also such issues as pay rises. Salaries for public sector workers should be increased. The increases we have made in the past two years did not match the inflation rates. There are many plans in this area but they can be jeopardised by the draught and a lack of funding. As for the rest, our performance indicators are growing in both industry and agriculture, which could become a new foundation for us. Investment is also growing very fast.

Vladimir Putin: What is current state of housing construction?

Nikolai Merkushkin: Housing construction is growing as well due to the federal programme on housing for war veterans, which accounts for a large proportion of this sector. Last year we achieved a growth rate of 6% in housing, and this year the growth is continuing. We are currently looking for additional resources to take the burden off the budget.

Vladimir Putin: What about the school modernisation programme? What can you say about the level of salaries?

Nikolai Merkushkin: We received the funding…

Vladimir Putin: You mean for the schools?

Nikolai Merkushkin: That’s right. We decided to allocate 136 million roubles for the republic. Our budget had significantly lower amounts allocated for those purposes.

Vladimir Putin: Perhaps. It varies from region to region.

Nikolai Merkushkin: It is a total of 28 million [roubles]. And although the resolution has been adopted, I would like to ask you if we could channel the funding to increase salaries as we have already resolved many issues such as upgrading school facilities, textbooks and computer labs.

Vladimir Putin: You would like to use part of the funding?

Nikolai Merkushkin: Yes, to resolve some of the issues. I would even say in regard with…

Vladimir Putin: We can discuss it, although as you know the funding was allocated for other purposes. However, this may be reconsidered in special cases.

Nikolai Merkushkin: I agree. As far as healthcare is concerned…

Vladimir Putin: I know. Let me congratulate you on the opening of a perinatal centre. It is a breakthrough in Mordovian healthcare.