Opening remarks by Dmitry Medvedev:

Good afternoon. We will continue our discussion on major repairs. We all met a while ago and discussed updating utilities, I mean the long-term aspect of this objective and the need to form a modern legal framework and the need to do this with maximum transparency. At that time, United Russia asked me to discuss some issues, and some other political parties called for such a discussion too. We are meeting as a result of the work that has been carried out in recent months. According to public opinion surveys, 80% of citizens are concerned about the situation with utilities and want to get unbiased and honest information on what is happening in this sphere.  

This is a common topic that is very important to people: the condition of buildings, communal spaces, courtyard renovations and the proper functioning of utilities. This is also the issue of the cost, because it is commonplace that the utilities charge a lot and their services are of low quality. Improving this work is a comprehensive task. This is a task for the federal government and for the regions and municipalities. The fact is that over 10 million square metres of housing are hazardous and due to be demolished as of January 1, 2012. This figure changes, but it strongly depends on the way you count. Some of the housing classified as suitable for living in regions in reality neither offers modern living conditions nor is fit for living at all.

One of the most sensitive subjects is organising major repairs. This is what we have been discussing recently. According to standard rules, major repairs should be conducted at the latest every 25 years. In this country, since the 1990s, less than 1% of housing saw major repairs per year. Because major repairs in the Soviet period were not very frequent, it would be correct to say that the authorities have never seriously dealt with this subject. This country began to resolve the housing problem approximately in the 1950s. Practically all buildings erected in the 1950s never had major repairs, and this issue had not existed formerly. As a result, the number of dilapidated housing continues to grow; the load on utility infrastructure continues to grow; and energy efficiency, which is already rather modest, decreases further still.

Under the Housing Code, landlords of blocks of flats must pay the cost of major repairs of communal property, that is, the building, but we lack efficient mechanisms providing for the participation of landlords in major repairs. Meanwhile, a considerable number of regions (about 60) are already charging citizens for major repairs. However, the targeted use of these funds, their safety and economic use are not regulated. This is a basic issue of fairness – some people pay, while others do not. They charge those who live in the building in terrible conditions and spend it on major repairs for another building that is in better shape. These issues are on the agenda, and one should not evade them. We need to improve the management of blocks of flats. This is a common task, and of course, we should increase the efficiency and transparency of management companies and homeowner associations. It is no secret that there is a great deal of scheming in this area. A great deal. We should attract additional investment, of course, private investment to a significant extent, for this.

So let’s discuss two draft laws today. The first is the amendments to the Housing Code and other legal acts aimed at financing major repairs of blocks of flats. It is currently being prepared for the second reading in the State Duma. A while ago, we discussed this subject in the meeting with the leadership of the United Russia parliamentary group and leadership of the party. We have discussed this in other places too. The draft law has been discussed on various platforms including the working group on utilities under the Open Government. The implementation of the draft law must create a modern system of financing and spell out the liability of landlords and finally provide for secure oversight over spending.

The federal authorities will approve the fundamental requirements and methodological recommendations on organising the entire job, and answer questions about how it should be organised across Russia – when and to what extent. The regions should be given more extensive powers under the legal framework, this is obvious. They will have to approve long-term regional programmes, and these programmes will include the complete list of buildings that need repairs, the year of major repairs, the relevant workforce and contractors. This is an important task that demands that the people be kept informed. People should understand what will happen. Again, this issue is complex and sensitive. That is why I have called together all those present to discuss it once again.  

The second draft law concerns the fund to facilitate utility reform. It is functioning well, it has been very successful. At the recent meeting on using additional federal funds (it was held on October 23), I decided to direct an additional 20 billion this year. And my colleagues, the governors, and not only governors have repeatedly asked me to extend the operation of this state corporation until December 31, 2015. Some political decisions on this have also been taken. These are two subjects for discussion, but these are problems. Before coming here, I signed some documents. I have signed an executive order on creating the Innopolis special economic zone. Let’s get to work.

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