Transcript of the beginning of the meeting:

Vladimir Putin: Mr Yurevich, how did the region perform in the first half of the year? What are your plans? What are the problems you are facing?

Mikhail Yurevich: Mr Putin, we have done well in the first half of the year. Industrial growth was 7.1%. Budget revenues increased by 16% in the municipalities and by 17.4% in the region as a whole. We expect to receive 110 billion roubles for the consolidated budget, which is a record-breaking figure. Beginning September 1, we will increase schoolteachers' salaries. The entire salary fund grew by 30%

Vladimir Putin: How does this compare to the nationwide average?

Mikhail Yurevich: Teachers' salaries will match the average in villages, or even exceed it. In large cities it will be 75% of the average. The average salary in the region is 18,600 roubles now. We expect the average salary to be 19,000 roubles by the end of the year.

Vladimir Putin: And when will teachers start receiving the average salary?

Mikhail Yurevich: We will increase their salaries next year again.

Vladimir Putin: But we should try to keep ahead of schedule.

Mikhail Yurevich: I agree, Mr Putin.

Vladimir Putin: We should try drawing salaries up towards the average throughout 2012.

Mikhail Yurevich: We will increase salaries again in 2012. I believe that teacher's salaries will approach or catch up with the country's average salary next year. We also increased salaries paid to kindergarten teachers and other staff, including guards, teacher's assistants, naturally, electricians and cooks. In percentage terms, the growth was 6.5%, and then another 30%, as their salary was lower initially...

Vladimir Putin: You are drawing their salaries up to the level of school teachers' salaries, right?

Mikhail Yurevich: Yes, we are. Another problem is that large cities lack qualified personnel in kindergartens, but there is no replacement for them. Migrant workers can be invited to work at a construction site if there is a shortage of local workers, but only qualified teachers can work in kindergartens.

As for housing, we have noticed that small flats, so-called studios, are in greatest demand. So the current regional programme entails the construction of a great number of small flats. The price is no more than 30,000 roubles per one square metre, and we plan to lower it to 24,000 roubles per square metre.

Vladimir Putin: And how much is one square metre in a larger flat?

Mikhail Yurevich: It costs a bit more or the same amount. But when someone buys a flat, he or she is more interested in the total cost than the cost per square meter. If a flat is sold at the price of a car, naturally it will be more affordable. That type of housing outsells all others on the market, and, at present, the region is making every effort to refocus the construction industry on the creation of such housing. Young people are buying it eagerly.

Vladimir Putin: There is a shortage of small flats both in your region and in other regions.

Mikhail Yurevich: It is the primary type of housing for young people, which they can later expand, exchange for a larger one, or sell and buy a new one.

As for agriculture, about 2 million hectares were sown. Weather conditions have been very favourable this year. Our region borders on the south, where sun and rain tend to alternate. We have very good crop prospects.

Dairy farming has seen a smaller margin of growth because the South Urals are rather dry, so there is little grass and dairy farming is not that profitable. However, we pay 2 roubles per litre of milk in regional subsidies to all dairy manufacturers and 300,000 roubles for the creation of new stalls. In other words, if a cowshed expands, we allocate 300,000 roubles from the regional budget for each new stall.

At present, two new poultry farms are under construction, and one old farm is being expanded. The programme is for two years, and we expect to increase our output by 50,000 tonnes of poultry. When the second poultry farm is finished, we will get another 125,000 tonnes. The Chelyabinsk Region currently ranks third or fourth among the country’s poultry breeders. Soon, it should rank second.

Vladimir Putin: Third or fourth is already good.

Mikhail Yurevich: That’s true, and we expect to export poultry in the future. Our weather conditions and farming areas allow us to successfully compete with any other poultry breeders.

Vladimir Putin: We have already touched upon the healthcare and school modernisation programme. Still, I would like to get back to healthcare. You have approved the programme. But I have a question on rural healthcare. Which part of the healthcare modernisation programme will account for rural areas?

Mikhail Yurevich: At present, the approach to rural healthcare has slightly changed. There should be a link to primary medical care – that is, a general practitioner – in every village. The region is divided into districts, and all villages are registered with the nearest district hospital. We will repair and maintain these large hospitals and install modern equipment that has never been there before. The Chelyabinsk Region is expected to receive 9.5 billion roubles for the healthcare programme. This is the amount that we should spend on healthcare in the next two years. We have just received the money, and the programme just started: we defended it two months ago. In 2012, people will already see the results, with a lot of new equipment installed and overhaul done in hospitals. The money will be partly allocated to increase the salaries of specialised doctors – there are still long queues to see them, despite our best efforts. Therefore, in addition to primary care, general practitioners, we are trying to make specialists more available in rural areas. On certain days, these specialists will come to see patients in remote villages.

Vladimir Putin: How much funding have you received for housing and utilities programmes recently, and have the funds been used appropriately? How many people have been resettled from dilapidated housing? How many houses have been repaired?

Mikhail Yurevich: The housing and utilities sector programme has been underway for many years in the region.

Vladimir Putin: And what about the housing utilities sector?

Mikhail Yurevich: First and foremost, I have housing utilities in mind.

Vladimir Putin: What about moving people out of ramshackle housing and repairing buildings that have not been maintained for decades?

Mikhail Yurevich: In terms of the figures, the region received about five billion roubles in four years. It is a huge sum and has allowed us to construct about 5,000 houses.

Vladimir Putin: A good result.

Mikhail Yurevich: I do not remember the exact number of people provided with housing. I was not governor at that time but was involved in solving housing problems at a municipal level. I can say for certain that the number is in the thousands. Although this year we received less funding, we managed to construct 176 apartment buildings.

Vladimir Putin: And is the sports programme proposed by the United Russia party being implemented in public courtyards?

Mikhail Yurevich: Mr Putin, the programme is very popular. United Russia has allocated 880 million roubles for the programme, 600 million roubles of which will go to the courtyards. It will be a “revolution” for Chelyabinsk’s courtyards! But it is not only Chelyabinsk but all of the region’s cities and towns that need restoration. Thus, we are launching United Russia’s programme across the region.

Vladimir Putin: The construction of rural highways is another important programme.

Mikhail Yurevich: I absolutely agree with you. Rural logistics and rural transport logistics… A so-called road revolution programme is underway in Chelyabinsk. It encompasses pavements, lawns, streetlights, and, of course, the roads themselves. The programme will run for many years and will only be completed after all of our remote settlements, small villages, municipalities, and, of course, large cities meet today’s global and European standards. We implemented the programme last year, and, this year, we have continued to make progress. Judging by the positive response of the population, the programme seems to be effective.

Vladimir Putin: We must plan our work by allocating the necessary funding and distributing resources. Don’t forget about that.

Mikhail Yurevich: Mr Putin, we support initiatives for the modernisation of villages.

Vladimir Putin: You already mentioned that kindergarten workers’ salaries would be increased. And how is the construction of new kindergartens proceeding? If I am not mistaken, about 700 places have been created or are being planned in Magnitogorsk.

Mikhail Yurevich: They are planning to create 1,000 places this year.

Vladimir Putin: This year?

Mikhail Yurevich: Yes, exactly. The norms have changed since the 1970s, when it was much easier to build kindergartens. At that time, they used to construct five-storey houses in which the first floors were occupied by kindergartens. But the norms have been simplified, which is a plus because now we can construct annexes in kindergartens in the form of upper floors in built-up areas. The number of floors has been enlarged. Previously, a kindergarten could not occupy more than two floors, but today the limit is three. Thus, it is cheaper to build a third floor than to build a new nursery building with all of the necessary infrastructure. The number of pupils has dropped because populations are now more evenly distributed across a given city or town. New housing is being built while the population remains the same. In one-shift schools, we provide extra rooms for kindergartens. If accommodation is available, school buildings may provide kindergarten rooms.

At present, we construct kindergartens only in new housing areas. We also build new kindergartens in rural areas because the existing ones were located in old buildings or even in log houses and are now closed. As a result, we have to build new facilities. The programme for increasing places at kindergartens is that complex.

Vladimir Putin: But is the programme available?

Mikhail Yurevich: Yes. It is a large programme. We plan to provide admission to kindergartens for children aged 18 months to two years across the region. Thus, child-care allowances will be paid until the child reaches 18 months… It is a two-year programme.

Vladimir Putin: A two-year programme?

Mikhail Yurevich: It will take two years to implement the programme for providing admission to two-year-old children, whereas all three-year-olds can get admission even today. It is possible that children aged 18 months will be admitted as well.

Vladimir Putin: Fine.