17 september 2011

Prime Minister Vladimir Putin holds a meeting with Tomsk Region Governor Viktor Kress

During the conversation, special attention was paid to social issues such as reducing the unemployment rate, increasing teachers’ salaries, social housing construction, including the “Teacher’s House” project initiated by the prime minister. In addition, off-plan investors’ problems were discussed at the meeting.

Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon. What is the current situation in the region?

Viktor Kress: It seems that most sectors are recovering from the crisis having reached pre-crisis indicators, with the exception of the construction industry.

Vladimir Putin: What is the registered unemployment level?

Viktor Kress: In 2009 it was 3.3%, as compared to the pre-crisis level of 2.2%, and now it is at 2.1%, and will come down to 2% by the end of the year.

Vladimir Putin: That is a little higher than the national average.

Viktor Kress: Yes, but it was a little more before the crisis.

Vladimir Putin: And now the unemployment rate is lower than it was before the crisis.

Viktor Kress: In 2008, it was 2.2%.

Vladimir Putin: This is an objective indicator. How much is the Gross Regional Product?

Viktor Kress: It has grown as well…

Vladimir Putin: By how much?

Viktor Kress: By about 3-3.5%.

Vladimir Putin: So this indicates growth?

Viktor Kress: Yes. The industrial output in volume terms for the seven months’ period is 3.3%, which is 22-23% in monetary terms.

Vladimir Putin: You began speaking about construction. What is the situation there? 

Viktor Kress: We have a problem with off-plan investors. We had 29 problem buildings. All of them are in Tomsk, and one in Seversk. We commissioned three of them last year, three more in the first six months of 2011, and will complete several more by the end of the year. We closely monitor the situation with each of the houses. We allocated additional funds from the regional budget, and will provide some more money in September. We are currently working on the 2012 budget in terms of allocating funding for technology and amenities... We must help the people. We are looking for ways to address the problem with two particular buildings, which will not be commissioned before the end of next year at the earliest. In this situation, we will probably offer rental accommodations to the investors who had sold their flats and are left without accommodation.

Vladimir Putin: You must help the people.

Viktor Kress: Of course. The overall situation is more or less in order. There is a problem with only two houses. Of course, our opponents are using it to stir up trouble.

Vladimir Putin: What is the general situation in the construction sector?

Viktor Kress: In general, the companies that build economy housing already feel more or less comfortable. Those who specialise in luxury housing are facing ups and downs, to say the least. Some construction companies will go out of business. Frankly, we are trying to prevent their bankruptcy because their investors will suffer as a result.

Vladimir Putin: What is the mortgage level for the Tomsk Region?

Viktor Kress: It is significant.

Vladimir Putin: How much?

Viktor Kress: About 70%.

Vladimir Putin: No, no. I mean mortgage loans.

Viktor Kress: Mortgage loans grew 1.8 times against the previous year.

Vladimir Putin: They grew?

Viktor Kress: Yes.

Vladimir Putin: In terms of the volume of loans issued?

Viktor Kress: Yes.

Vladimir Putin: What is the interest rate? It is good that the loans are growing but is the interest rate going down?

Viktor Kress: Yes, a bit. Sberbank mostly finances economy housing construction. Even our construction plant, one of the few that are still operational, builds 22-29 square metre flats (studios). As soon as the foundation is down, these flats are sold off-plan, mostly to students and young families. Currently we are building a house for rental accommodation. The rents are not going to be commercial. At present, the commercial rate for a one bedroom flat is 12,000 to 15,000 roubles per month, for example, and we plan to bring it down to 5,000 roubles.   

Vladimir Putin: Have you heard about my initiative which I called “Teachers’ House?”

Viktor Kress: Yes, I have.

Vladimir Putin: We provide loans with a minimum interest rate and will help in other ways as well. The Tomsk Region can set an example by helping with the down payment.

Viktor Kress: We have already started doing this. Last year we called this “social housing”, where we cover the down payment and the interest rate for three years.

Vladimir Putin: So you are already doing this.

Viktor Kress: We have started. One hundred and seventy families in Tomsk have already received housing through this scheme.

Vladimir Putin: Excellent. It is especially important that we provide such housing for teachers.

Viktor Kress: Yes.

Vladimir Putin: Good.

Viktor Kress: And we’ll see how else we can…

Vladimir Putin: Have you raised teachers’ salaries?

Viktor Kress: Yes, by 30%. Together with the 6.5% (6.5% since June), the increase amounts to 30% since last September. The average salary was about 16,000, and now it will be 20,180-20,190 in 2011.

Vladimir Putin: And what is the average salary across all industries?

Viktor Kress: The average regional salary at the end of the year was 21,490.

Vladimir Putin: And this year?

Viktor Kress: This year it will be 24,000.

Vladimir Putin: And when will the teachers’ salaries reach the average level?

Viktor Kress: In 2013.

Vladimir Putin: That’s a long wait.

Viktor Kress: Well, by the end of 2012.

Vladimir Putin: In the course of 2012, agreed?

Viktor Kress: Agreed. We are making the calculations now.

Vladimir Putin: Good.