Transcript:

Vladimir Putin: Good afternoon, colleagues.

As you know, motorists face numerous problems – bad roads, traffic jams, and lack of parking spaces. Today we will discuss car inspections. A new law on inspections entered into force on January 1, 2012. So far we have visited one of the stations, and I saw how it works. In general, everything is well organised. Igor Shuvalov headed the committee, the working group, which drafted the decisions that were discussed in the State Duma before becoming law.

Work has begun, and today I would like to talk to you about how it is being carried out, what problems you see, and what aspects should be modified. We visited a station where your colleagues began inspecting vehicles. They paid attention to information support, for instance combining the issuance of inspection cards and compulsory auto insurance. This would be convenient for people, of course. Let’s discuss this.

But first I would like to discuss the most important thing, namely the fact that from now on inspections will be held at service stations that will be certified not by regional officials or by federal agencies or even by the State Road Traffic Safety Inspectorate, but rather by the Russian Union of Auto Insurers. This is an issue of fundamental importance. With this in mind, I would like to draw attention to another possible trap, which is the potential ambition to monopolise the market. This, I think, is unacceptable, considering the interests of consumers. Also, we should not underrate cost effectiveness of enterprises involved in this activity.

A while ago I spoke to a head of one of these enterprises. He says that the amount of work has increased but revenue has not grown. This a significant point that we all must heed. Naturally, regional authorities can play a positive role – I mean that they can allocate some subsidies, especially benefits for low-income and vulnerable social groups, primarily the disabled, retirees, and so on. In Moscow a maximum price of 690 roubles has been established, and retirees with a single car are entitled to free inspection. And practically every region has this option and a need for instituting a fixed price barrier. The methodology for this has been developed by the Federal Tariff Service. There is no place for any undue hesitation. Naturally, it will be necessary to take into consideration regional differences: we must set up mobile stations in locations where fixed service stations are lacking. Naturally, today at least, traffic police should supply the necessary quantity of inspection stickers, every station should have them at its disposal. There is seemingly no such shortage as yet, I mean that the New Year has just begun, and the high season of vehicle inspection is spring, as we know.

In general, I have looked over how inspections are run: essentially one vehicle can be inspected every thirty minutes and receive an inspection sticker. This is a good, significant step forward, in my view. The main thing for all of us is to properly organise work and make the process convenient for people, but again we should not prevent enterprises from making a profit. A service station should be able to make a decent profit. All currently operating stations can operate in this regime until 2014, but new setups will have to be certified in 2014.  

Let’s discuss all current issues related to inspections. Please, who will begin?

Vyacheslav Lysakov (Chairman of the Co-ordination Council of the Freedom of Choice interregional public motorist organisation): May I begin?

Vladimir Putin: Go ahead, Mr Lysakov.

Vyacheslav Lysakov: Thank you. I had a preliminary discussion with my colleagues – all of us are monitoring the situation on servicing not only passenger vehicles but lorries and so one. Currently we see two problems that can be solved and need to be solved. We should protect this market from swindlers and unscrupulous operators. Unfortunately, under current law the Russian Union of Auto Insurers certifies operators only through paperwork; they cannot examine every operator’s equipment and so on. There is a well-known case that has gained a lot of attention on the Internet: there was a business that had no equipment at all but was legally certified. This business legally obtained a heap of inspection stickers, and now this company can sell these stickers. This is the first thing. We will do our best to resolve this problem in the new State Duma. We will have roundtables and so on. And we will think how to legally protect the market from blatant swindlers. This is the first thing.  

Another case involves a business with some equipment that had been certified but does not use its equipment for car inspection; but it also could sell these inspection stickers. There is a solution to this problem. I know some young programmers in Perm, they have proposed a software monitoring system for all stages of car inspection and printing the sticker at the final inspection stage only. This is one option. We will surely meet with Mr Bunin (Pavel Bunin, president of the Russian Union of Auto Insurers), and Mr Kiryanov (Deputy Interior Minister Viktor Kiryanov), we will meet with our colleagues, we will discuss how to safeguard the system, maybe with software, maybe in a different way. But so far these are two conspicuous problems that are obvious. I believe that car inspection problems gained excessive attention from journalists because in this period after the New Year there isn’t much news to report. We do not see any particular problems as yet, but we are monitoring the situation and we will continue to track it and make adjustments both in terms of legislation and organisation.

Vladimir Putin: Mr Lysakov mentioned a problem, an insignificant problem at first sight, but nevertheless I want to draw Mr Shuvalov’s (First Deputy Prime Minister Igor Shuvalov) attention to this – I mean the equipment that is necessary at service stations. There shouldn’t be excessive requirements, and there should be no requirements specially tailored and meant just for a certain producer or seller. During my visit to one of the stations, I was shown one of the Ministry of Industry orders which, to judge by everything, sets clearly higher requirements, ones calculated for a single supplier.

Vyacheslav Lysakov: An affiliated one, it seems.

Vladimir Putin: Maybe, I don’t know, but this raises many questions. I will give it to you now, I have a copy of this order issued by the Ministry of Industry, it needs to be checked. Understandably, we should set the best standards, but what are the implications of these standards? Are we forcing everyone to purchase this expensive equipment? How’s that? Please look into the matter. This is the first issue.

The second one is to adapt traffic police data bases so that the service stations that will issue the technical inspection documents can use these data bases easily. There are also some questions involved here. Will you comment on them, Mr Kiryanov?

Viktor Kiryanov (Deputy Interior Minister of Russia): Mr Putin, we have done a lot of work on this, and even now that the technical inspections are done under the new programme, we continue to refine the process. The first days have shown that the change has been generally painless… I thought (as a professional in this business) that there would be far more questions in the very first days of the inspections. But now we have practically none at all, mainly because we are in daily touch with one another and have been monitoring the situation in each region. We are still present at over a dozen regions, and are responsible for technical inspections there (I mean the State Traffic Inspectorate), while all the other regions are already functioning in a normal regime. There are some rough edges, of course. This is an important undertaking, but I think we will deal with it okay. We have a complete understanding, and what needs to be remedied under the programme will be remedied without fail, and what needs to be updated in the data base will be updated. I don’t think this is a complex business; we are working in the right direction.

Vladimir Putin: Good.

Vyacheslav Lysakov: Mr Putin, the State Traffic Inspectorate (GAI) charges 300 roubles per inspection.  Unfortunately, there are only 95 such centres left in Russia and they will operate until December 31, 2013, but rates vary across regions: from 300 roubles to over 1,000 roubles. The GAI centres charge 300 roubles because of legal considerations. Therefore, motorists can choose either a commercial business or the GAI system. The Interior Ministry has made a good decision by introducing what is known as inter-regional technical inspections. That is to say, anyone can get an inspection in whatever region they like, regardless of where the vehicle is registered. This is a move to meet us motorists halfway.

Viktor Kiryanov: I see. This is a sort of saving device. Where we see things go awry, we step in and correct it.

Vladimir Putin: Let us listen to our colleagues. Mr Bunin, you have the floor.

Pavel Bunin: Thank you very much. We have taken up and are continuing this work, as Mr Kiryanov said. All operating centres that used to work with GAI are accredited with the Russian Union of Auto Insurers (RSA) and provided with registration cards. New commercial centres are also accredited and furnished with the new cards. I agree with Mr Lysakov about the dishonesty of some possible inspection operators. This problem must be solved with the help of the expert community and modern IT technology.

Concerning the monopoly you mentioned. A total of 1990 centres that used to work with GAI are now included in the register. They belong to a variety of legal owners and it is difficult to think of this as a monopoly, although the Federal Anti-Monopoly Service can always take a look. Thirteen new commercial centres also belong to entirely different companies, to individuals and to a large auto dealer, Zhilkomkhoz, in the Kolyma area – they are totally different. So we will wait and see if a monopoly develops.

About mobile centres. The current focus is on new mobile units to bring services closer to consumers. One unit is priced between 300,000 roubles and 500,000 roubles. In general, they are a great help for small businesses, they create additional jobs. Car insurers are interested in having cars on the roads in good repair.

Vladimir Putin: Good. Mr Vasilyev, you have the floor.

Alexander Vasilyev (leader of the online community Wrecked Roads of Pskov): I consider it important that technical inspection centres also be in good condition. But still, this system … A person must be at the centre of the system, with everything suiting his or her needs, with the mandatory procedure being convenient for him or her. I looked into how this is done in Pskov. So far, people are generally pleased. Predictably, they started with a dose of skepticism about technical inspection stations. But there is no traffic inspector on the staff, and the price is almost half as much because there is no need to pay the state duty (300 roubles) and for the registration card. The procedure is quicker, and fewer documents are required – these are all positive things. Still the community is saying that a technical inspection is an arbitrary process and the market is rife with manipulation. But I understand it cannot be abolished if existing standards, including international ones, are borne in mind.

Vladimir Putin: The standards are not the point. The point is safety for traffic and safety for people.

Alexander Vasilyev: Yes. But even insurers are saying how difficult it is to prove if a vehicle was in good or bad condition before an accident.  

Vladimir Putin: Mr Vasilyev, you are talking now from a business perspective. We should think about road safety.

Alexander Vasilyev: I see.

Vladimir Putin: The primary concern is human safety and health. How can a vehicle posing a risk be allowed on the road? All road transport is a source of enhanced danger even when vehicles are in a good and normal condition. But what if that vehicle is in a poor state of repair?

Alexander Vasilyev: The central issue is to eliminate arbitrary actions. That is the key goal: all customers must be equal; all should get absolutely the same technical inspection, pass through it honestly, and have their cars go through all these procedures so that we can have safe cars on the roads.

Vladimir Putin: Mr Volchek, you have the floor please.

Igor Volchek (President of the Union of Motor Technical Inspection): I represent the operators. I am the owner of the station you visited today.

Vladimir Putin: It’s a good station. Has it been in operation since 1994?

Igor Volchek: The station has been there since 1996. It has much experience under the previous system and for a week now we have been working under the new law and have gained enough expertise… The first positive thing is that we have eased the procedure for vehicle owners because now we ourselves are responsible for the process and do not have to look to the State Road Traffic Safety Inspectorate, with which we used to cooperate on a contractual basis. And I, as the owner of the station, can, for example, fully control the process though my staff. As you saw, everything is well organised, and people no longer wait for information. They drive in, pay, and while information is being fed into the data base, their car is being inspected and in the end, upon completion of the process, the person concerned can get the card, and if the owner wants an OSAGO policy (obligatory insurance of vehicle owner civil liability for third parties) everything is organised, as you noticed: if the vehicle is technically sound, the driver gets the policy right away, which is convenient and proper.

Before, when a traffic police officer was there, it was psychologically difficult for people: they were scared because they knew the police could pick on them. Now this psychological burden has been lifted – there are business people who welcome clients and are prepared to carry out the inspection. As one who has been in the business for 17 years I think a technical inspection is a form of independent expert examination. There are repairs and there are technical inspections. Repairs are not always made honestly. We service a car, change the oil and so on. A technical inspection is an occasion when it is possible to see and understand how honestly the car repairs were done. An inspection is not undertaken too often – it might occur once in two years or once a year. Motorists should realise that we check their cars above all for traffic and environmental safety and do not focus on things not directly related to safety.

Have you noticed that the law as it is formulated today may have improperly worded requirements for the equipment? The equipment at our station is mainly the equipment that checks safety and environment-related features: it is exhaust analysis and brake testing. Brake testing is particularly important, and special rollers are used for such testing. They can determine not only the braking effort, but also any unevenness. This is very important in our complex conditions where we drive most of the time on slippery roads. That is an important aspect and one that technical experts draw their attention to, and supply information to the car owners. I think a dialogue is essential during the technical inspection and not the former procedure when a traffic cop just issued a card without much civility … 

Now we try to supply the vehicle owner with the necessary information. If the car is in bad repair, we provide this information… And the best part of the new law is that we can remedy small faults right on the spot. That is, if headlights are not adjusted, or if an old car does not meet the exhaust analysis standards. We can repair this defect under the new law, and this is important because we do not send away the owner without a card, but can do it on the spot. We are doing it free of charge so far. Naturally, our non-profit partnership is trying to work out a plan under which we could provide about the same service at least around Moscow and perhaps across Russia.

Another key point is the automation of the process. Today one of the problems, an organisational one, is automating the transfer of data from a diagnostic line to the Interior Ministry’s single information system. Our partnership has already worked out a programme to do so and we are going to install it soon. I hope this problem will be resolved at least within Moscow. We can share this experience with every region. This is necessary for the process to be automatic and for shutting out any possibility of ignoring technical inspections and selling registration cards. This is because if information is sent along, it will be objective information from equipment and will be difficult to get around. And dishonest firms that have no proper equipment will not be able to sell the cards.

Another important point I would like to stress is that the law sets no requirements for production facilities, which enables dishonest firms to get accreditation by having some document or perhaps even equipment or some mobile unit not tied to the premises. That is very important: the equipment must be tied to a facility. The equipment must be metrologically guaranteed. If there are certificates to confirm this, that’s enough. The new law also requires skilled personnel – unlike before. It is personnel that issues technical inspection cards in place of the traffic police and they have to meet the updated requirements.

Vladimir Putin: Known as experts.

Igor Volchek: Yes, known as experts. And this too is a problem because such specialists are at a premium across Russia, since the requirements have changed. Fortunately, they are available in big cities like Moscow. You saw today how they conduct a technical inspection. They fully meet these qualifications. But they are few and far between, and it is a problem that needs to be discussed and resolved, and we are already tackling it. I hope that by next month we will organise courses to train people to carry out these inspections and to later be re-qualified as technical experts.

Vyacheslav Lysakov: May I put a question to Mr Volchek? You have confirmed the need for altering the regulatory standards in this respect. Certainly, we will work on it. What about a simpler version of a technical inspection. Say, you provide services to certain vehicles over a long period, say, one or more years, and your mechanics know the cars inside out, since they do all repairs and maintenance checks. Are you involved in vehicle maintenance?

Igor Volchek: No, we deal only with technical inspections.

Vyacheslav Lysakov: All right, then my question goes to everyone. Mr Putin, suppose there’s a certified car service facility that services vehicles for businesses and individuals. The mechanics working there know these cars, since they repair and maintain them. Why don’t we make such a service responsible for… In other words, they should guarantee the workmanship and confirm that a particular car is being serviced, maintained and repaired by them, and that this particular vehicle complies with the technical requirements. In fact, such a statement is as good as a technical inspection slip. This is one way of taking the hassle out of a vehicle safety inspection. If someone is doing the repairs in his own garage, he can take all the steps involved in having the vehicle pass the inspection. However, if a vehicle is being serviced by certified professionals why make the owner re-confirm the obviously good condition of the vehicle? An auto service centre that’s engaged in servicing a vehicle should be aware of all the problems associated with the vehicle and be responsible for the quality of its own work. This is just a proposal for further discussion.

Vladimir Putin: Mr Volchek, what are the functions of this non-profit partnership?

Igor Volchek: We have established this non-profit partnership as a public organisation, a kind of a trade union, which in our case brings together almost all of the enterprises based in Moscow. Our priority is to protect the businesses and we work exactly to… The first thing we will do is develop software which will help us automate processes. We conduct training, make information available and provide legal protection for companies that engage in this line of business. Mr Putin, in this respect I’d like to say, that in my opinion technical inspections are subject to self-regulation. Being part of a self-regulated organisation, technical inspections will help address the bulk of the issues that are being discussed here today, but are not covered by the regulations. These issues include requirements for the production and technical basis of the process and for staff training. In other words, we need a certain number of service centres in the regions. We have this information and we’ve gained some experience, so we can partner with the Russian Union of Auto Insurers and address these issues together. Notably, non-profit partnerships or voluntary self-regulating organisations are already available in almost every region. Our strategic goal is to unite them and establish a single national association in the near future. I believe that this is the right approach.

Vladimir Putin: You’ve mentioned the equipment – technically, a minor issue – that you’d been using for several years now. As far as I understand, it’s good world-class equipment. Your manager told me today that the executive order – at first he wasn’t even sure what document we were looking for, but finally we located this executive order issued by the Ministry of Industry – sets forth apparently excessive requirements with regard to equipment of this kind. Please, tell us what that is all about.

Igor Volchek: I believe the hardware requirements are somewhat inaccurate. For example, brake test requirements are obviously overestimated. Clearly, we don’t need this kind of equipment because the hoist requirements were drafted for vehicles weighing over 6 tons. As a matter of fact, we have never had such a vehicle at our service centre. There is absolutely no point in setting such high standards. Next, the new rules require measuring the level of noise, which I think is wholly unnecessary. At the same time – perhaps, it’s a minor oversight – there are no requirements with regard to testing exhaust system leaks. Does this mean that we must measure noise levels and ignore leaks? Most interestingly, some cars have already passed an inspection. I believe that this makes no sense and is unnecessary. These things can just be left the way they are now, and we shouldn’t waste our time on them. Same goes for measuring the free play. This is a fairly sophisticated instrument. What I mean is that it’s difficult to mount it on a vehicle. Our technical experts are very experienced mechanics and can tell the range of free play by eye. Certainly, if they feel that the free play is above normal, they have to use the instrument in order to let the customer know that something is wrong with his vehicle. I believe that we should somehow make this procedure less complicated. This will benefit both the operator and the vehicle owner. You had the chance to see that with good equipment this work can be done in 20 minutes, which is sufficient for identifying all the safety issues.

Vladimir Putin: Now, please say a few words about the compatibility of the database operated by the State Road Traffic Safety Inspectorate.

Igor Volchek: We have done a lot of work on this. I believe that we have done a lot, along with the Interior Ministry and later with the Union of Auto Insurers, to convert to the new system. We started on January 10. The information system operated by the Interior Ministry works just fine. There were certain glitches which have been removed over the past few days. We now send the information without any problems. What we are still lacking is the link between the equipment and this system. We have already developed a programme. I don’t see any problems with installing this software.

Unlike before, we can’t receive any information from them now. Therefore, we have to enter the vehicle and owner information into our database by hand ourselves. Previously, the traffic police inspector could obtain a drivers’ personal files from their own database which is off limits to us today. If this is considered…

Vladimir Putin: This is exactly what I had in mind.

Viktor Kiryanov: Mr Putin, previously we would make a query and also check if a vehicle had been reported stolen. The query returned all the information about the vehicle and, certainly, we didn’t have to enter vehicle information by hand. Now, we have to waste our time on that. Of course, it’s not very convenient. However, I think we can work on this as well and come up with ways to remedy the situation.

Vladimir Putin: Yes, please think about ways of making the system work automatically. It will be more convenient for you, and for other companies and, most importantly, your customers, because they will spend less time waiting for their vehicles to be fixed. Agreed?

Viktor Kiryanov: Yes.

Vladimir Putin: Mr Titov, please go ahead.

Igor Titov (general director of the R&D Institute for Motor Transport): Thank you, Mr Putin. Our institute is among the originators of safety inspections. We have a subsidiary, a safety inspection post operated along with the German DEKRA company. The equipment used at this post, which is among the leaders in the safety inspection business, happens to comply with the most stringent requirements. All of our information comes from experience rather than theoretical assumptions. We enjoyed developing these regulations because it’s gratifying to make law from reasonable and convenient provisions that correspond to international practice. Our political task was to make the law as straightforward as possible. We were very serious about it. There are safety regulations for land-based transport with hundreds of requirements. Previously, it was assumed that technical inspections were conducted in accordance with these countless requirements. Now, we have a well-defined list of them. First, technical inspections are guaranteed to be conducted in accordance with these requirements and, second, these requirements cover safety parameters involved exclusively with vehicle operation. I disagree with our colleague in part regarding no need to measure noise levels. I believe it’s a very important requirement, something that can become a nuisance if not complied with, and it needs to be followed. The diagnostics can be performed quicker. For example, for a gas-fuelled vehicle the time needed can drop from 43 to 31 minutes.

Vladimir Putin: Is that what it takes to run diagnostics in real life? About 30 minutes?

Igor Volchek: Yes, 30 minutes or even less.

Vladimir Putin: So, your calculations are correct.

Igor Titov: Yes. Notably, there were certain inconsistencies between some of the regulations, but as far as I know, instructions have already been issued to correct them. I’m talking about the technical regulations covering service requirements. The requirements that are included in the resolution should not contradict each other. As a matter of fact, I’d like to ask you to issue this instruction.

Vladimir Putin: Thank you.

Mr Bunin, is there anything that you’d like to add?

Pavel Bunin: Thank you very much. I’d like to get back to the Interior Ministry’s database. It’s very important for us to know who operates the clean database, because there’s always room for human error during data entry. Looking for errors later is a problem, so we need to put in filters. If only we could make a political decision about a database with access – certainly a restricted one – for insurers and safety inspectors, then there will be fewer errors and disputes.

Vladimir Putin: I think that this can be done. Mr Kiryanov, could you please instruct your employees accordingly, and I’ll talk with Mr Nurgaliyev (Minister of the Interior) as well. We need to protect the information that is used strictly by the Interior Ministry and make the rest available to operators and others involved in this business.

Pavel Bunin: Thank you very much.

Vladimir Putin: We can do it.

Mr Shuvalov, please go ahead.

Igor Shuvalov: Mr Putin, we have ongoing meetings with regard to the technical inspection procedures under review. Yesterday, we instructed the Ministry of Industry and Trade to submit corresponding amendments in order to make the technical inspection procedure fully compliant with the rules governing the conduct of safety inspections so as to remove anything that’s redundant. Deputy Minister of Industry and Trade Vladimir Salamatov has received these instructions.

Another issue that the media has been discussing since early in the month is the lack of corresponding card forms at all service centres. We decided that service centres which do not have the forms for whatever reason can simply write up a paper to include all the vehicle information, sign it and submit to an insurer. This paper will be enough for the insurer to issue mandatory OSAGO third-party liability insurance. The Union of Auto Insurers backed the approach.

There’s one more issue. Back when we were developing the draft law, we thought that all service centres that had been accredited as of late 2011, had been entered into the register (we haven’t removed any, but rather added 13 more). What we meant was to accredit dealerships and service centres that had never been engaged in providing these services. We also kept in mind the point that you’ve just made when service centres that do maintenance and repairs on an ongoing basis can issue corresponding …

Remark: By default.

Igor Shuvalov: Yes, by default, since such vehicles are serviced regularly in accordance with the service manual. This information will be submitted to the insurer. This is why we included this option in the law. We don’t have such organisations yet, but we hope that some dealerships and specialised auto service centres will be accredited.

Vladimir Putin: Let’s cut to the chase, as they say. This issue is clear and quite concrete. Millions of Russian people are interested in having this settled properly. This issue is important for almost every Russian family. The number of cars is growing exponentially in this country. What is the increase percentagewise?

Viktor Kiryanov: There are 44 million plus vehicles in Russia today. Of course, that’s a huge number. We have 2.148 million more cars this year than last year.

Vladimir Putin: International experts say that the Russian market is one of the most promising car markets in the world. It is growing at a very fast clip. In 2010, more cars were sold in Russia than in India with its population of over one billion. Can you imagine the size of the Russian market? There are many problems involved, including the one that we are discussing now. First, I’d like to thank you and your institute. The State Road Traffic Safety Inspectorate also did a good job, just like the rest of the Interior Ministry, and the government commission as well. However, we know that there are adjustments that need to be made. The goal of our meeting today is to identify any problems and outline specific measures to resolve them effectively. Mr Shuvalov, please submit these proposals as soon as possible.

Igor Shuvalov: Will do, and I will report back to you.

Vladimir Putin: Thank you. There’s one more issue that I’d like to draw your attention to. It has to do mostly with public organisations. I’m talking about roads and road funds. They will be funded with taxpayer money. The regions will receive 90 billion roubles for their road funds and 94 billion more will come from excise taxes. That’s a lot of money. We have never allocated that much money for these purposes, nor have the regional budgets ever seen such amounts. Public organisations and regional legislative assemblies should monitor the proper use of these funds so that the people can actually see that roads are getting better. Thank you.