Transcript of the beginning of the meeting:

Vladimir Putin: How are things now? What about the territory’s economic performance?

Sergei Darkin: Mr Putin, the social and economic situation is stable. Our gross regional product has grown by 106.5% since the beginning of the year, the unemployment rate stands at 2%, and the average wage is 24,000 roubles per month. All enterprises are working steadily and showing very good development. Investment has increased by 125% as compared to the past year.

Mr Putin, thank you very much for the gas connection. I reported to you about the cost of heating oil today, and we are buying 500 million metric tonnes of it…

Vladimir Putin: It is important for this to influence real prices.

Sergei Darkin: Since we have received gas, we are not going to increase heating prices for consumers next year. The gas will allow us to stabilise prices, because heating oil cost four times as much.

Mr Putin, in addition to this, I’d like to say you created a very good programme two years ago…

Vladimir Putin: How many combined heat and power stations will be switched to gas in the near future? Currently there are two…

Sergei Darkin: Two.

Vladimir Putin: …a small one and a big heat and power station.

Sergei Darkin: Exactly, we have two.

Vladimir Putin: When will you switch the other three big stations to gas?

Sergei Darkin: We’ll still keep some of them on coal, which is economically more efficient – we have a large fuel and energy facility at Luchegorsk in the north of our territory. We will switch our major heating oil boilers to gas – these provide heating for such big cities as Nakhodka and Ussuriisk with populations of 200,000. Heating prices were very high there.

Vladimir Putin: I see.

Sergei Darkin: During the next two years we’ll start…

Vladimir Putin: During the next two years you must stabilise these prices. Well, the difference is not that great. If heating oil is four times as expensive, this should affect the rates. But they must be stabilised, to say the least.

Sergei Darkin: This is what we planned to do, Mr Putin, because we never had gas for such a price. This works well for us…

Vladimir Putin: It’s a little higher than in the European part of Russia, but incomparable to Gazprom export prices. The local price is $140 for 1,000 cubic metres. Today, Gazprom exports 1,000 cubic metres of gas for $400, so local consumption is 3.5 times less expensive.

Sergei Darkin: Mr Putin, I have one more request. We had a great programme that you initiated two years ago – on subsidising travel from the Far East to western Russia. This was very helpful – 65,000 people in our territory used this privilege last year. Tickets were more accessible, as they decreased in price by half. We would like to ask you if it is possible to consider the issue of… We would like to receive similar subsidies for shipping our goods – for instance, our fish, soya products, and rice – to central Russia, at least partially. We would also like to have subsidies for shipping our processed timber there and for receiving heating oil and petrol from there. Regrettably, petrol here…

Vladimir Putin: You must build your own oil refineries here.

Sergei Darkin: We are waiting for them to be built. Rosneft plans to start the construction of a petrochemical plant in 2012. Clearly, once this is done, the price of petrol will be different.

Vladimir Putin: You must build your own oil refineries. Okay, we will talk about this later. What about your programme for modernising schools and medicine?

Sergei Darkin: Mr Putin, we have received federal funds for healthcare, thank you very much. We have also contributed our own money and we will put all of it to use this year. Naturally, we have considerably increased the rate of contribution to the Mandatory Medical Insurance Fund. We want to make the rate suitable not only for our governmental institutions but also for their non-governmental counterparts that could provide the public with the same services.

Vladimir Putin: How much have you received for modernising healthcare?

Sergei Darkin: We have received 3.5 billion roubles. We have never received so much, and thank you, Mr Putin. We received 350 million roubles for modernising education and raised teachers’ salaries by 30% on September 1. Significantly, one-third of this amount will go to teachers providing additional education – extracurricular classes and so on.

Vladimir Putin: When do you plan to match the national average?

Sergei Darkin: We plan to do this in two years.

Vladimir Putin: So, two years. How much do your teachers make today?

Sergei Darkin: On average, they make 14,000 roubles.

Vladimir Putin: And the national average is 24,000 roubles, right?

Sergei Darkin: Yes, 24,000. We have raised teachers’ salaries by 30%. Now, obviously, we will have to step up this process.

Vladimir Putin: You have raised them by 30% and reached 14,000?

Sergei Darkin: No, they made 14,000 and now they will receive 30% more – about 18,000.

Vladimir Putin: Next year...

Sergei Darkin: We will try to do this.

Vladimir Putin: Good.