22 october 2008

Russian Prime Minister Vladimir Putin met with Novosibirsk Region Governor Viktor Tolokonsky

Vladimir Putin

Meeting with Novosibirsk Region Governor Viktor Tolokonsky

"The special federal university network is a separate issue motivated by our plans to promote innovative development of certain regions."

Viktor Tolokonsky: Mr Putin, I can report that we have posted sustainable growth rates in the last nine months. Industrial output and the gross regional product (GRP) grew by 12.1% and by over 11%, respectively. The agriculture and related industries also chalked up high growth rates. Our parameters and indices show that we have made a significant contribution to budgetary proceeds and rising quality of life, and made it possible to draft a special programme. The current situation in the region is such that every economic sector shows dynamic and cost-effective development.

I am convinced that the adoption of the Transport Strategy is now consolidating the region's positions. The list of investment projects does not include many facilities in our region, but that is because the Government is presently focusing on East Siberia, the Far East and Southern Russia.

However, all our transport sectors are receiving additional funding from the budget. The Novosibirsk airport, the road and railway networks are currently being expanded. All this allows us to build numerous modern production facilities and logistics complexes. I reported earlier today that we are building three such complexes at the city's entry and exit points. One complex will be located near Tolmachyovo Airport. The other one, which you have seen today, will be built at the northern entrance, on the border with the city's eastern suburbs.

Several dozen industrial enterprises will be located around these complexes. We are fully confident about the future because our enterprises continue to develop rapidly, our GRP is growing, along with the number of new manufacturers.

In my opinion, processing industry companies working to state orders are posting high growth rates and account for over 12% of the total increment. The list of such enterprises includes an aircraft plant. We've just reported to you about the Sukhoi SuperJet 100. All other components of the airliner were manufactured by the Novosibrsk aircraft plant.

Vladimir Putin: The tests were completed today.

Viktor Tolokonsky: Yes, this is very important for us. Current development trends have compelled us to set up a special personnel-training centre tackling highly specialised issues. To train professionals and create favourable working conditions for them we have also pooled the efforts of an aerospace school, two vocational-training schools and the Technical University's Civil Engineering Department.

We have recalled our previous experience when young people had studied for three days at the University and worked for two days at the plant in different workshops and sections. This really helps future engineers to master the intricacies of their profession and makes the transition to a work environment easier for them.

The plants that have been awarded important and challenging state contracts are also feeling confident.

We have harvested all the crops. As I told you earlier, that was hard this year because we had heavy rains in September that lasted 12 days in a row. Nonetheless, we pooled our efforts and managed to harvest 3,200,000 tonnes of top-quality grain. Food-grade wheat accounts for 80% of our grain harvest. Local farms are also feeling confident.

At present, we are implementing special measures together with the Agriculture Ministry, to sell part of grain harvests to integration funds and state reserves so as not to cause a delay in the turnover.

But what is even more important than the bumper crop is the tangible positive effect of retooling programmes, implemented at all companies. We had long believed these sectors to be unprofitable. But, after farmers started taking out long-term and virtually interest-free loans provided as part of national-project programmes, we promptly passed a regional law stipulating 30% compensation for new equipment purchases out of the region's budget. In effect, they do not have to pay high interest and, in addition, are entitled to compensations.

Instead of subsidising products, the way some regions do, we provide assistance with technical renewal. In the last two years, our farms have bought new equipment worth 8 billion roubles ($296.3 million). These are mainly seeding machinery and combine harvesters.

When visiting different parts of the region after the harvesting season, I was pleased when machine-operators told us that such a bumper crop would have been impossible without the new equipment. This is crucial, especially as this year the first snow fell in September.

It is highly rewarding to see people's confidence. Apart from high growth rates and improved quality of life, people are becoming confident about their future. Such confidence helps boost their self-esteem.

But we would like to ask for your support on a number of important issues. We have coordinated this in great detail with the Transport Ministry and all agencies. The Minister has already reported to you that the bridge across the Ob River is now being built within city limits. In fact, we had formulated this problem back in the 1970s.

Vladimir Putin: This must be linked with the development of the transport system and the entire city infrastructure, including the new bypass freeway and the situation inside Novosibirsk.

Viktor Tolokonsky: We are encouraging metro traffic because the city is located on both banks of the Ob River, and all local bridges are overloaded and construction of the new bridge will take some time to complete. You can see the tariffs and a special plastic card. Benefits envisioned for veterans and students will create additional traffic along the metro bridge across the Ob River.

Although we commission new stations once every two years, we need to step up our efforts. This is why I wanted to ask you about co-financing terms. The Novosibirsk Region and the city are financing 50% of the project on a parity basis. We have discussed this issue with the Transport Ministry and have prepared the required design documents and records.

Vladimir Putin: How much do you receive now?

Viktor Tolokonsky: Annual federal allocations total 400 million roubles ($14.8 million).

Vladimir Putin: Do you spend the money on upkeep and development?

Viktor Tolokonsky: We use it to finance construction of new stations. We are adding another 50%. Next year, we planned to allocate 700 to 800 million roubles from the regional budget ($26-29.6 million).

I would like to mention another issue that we have already discussed. We have a unique opportunity to use the potential of the Akademgorodok University and its research institutes more effectively.

University departments are traditionally located at institutes, which have the required laboratory equipment. In fact, students receive real-life training at particle accelerators and electric units. In all, 35 institutes use these departmental facilities.

This summer, the Academy held general elections and now the Presidium of its Siberian Department has new members. Old-time problems are now history. We have decided that there is no need for any departmental changes or those involving subordinates. All we have to do is focus on effective integration.

The institute received federal university status in line with your decision and is working on its integral development programme.

We have briefed you on the implementation of the Technology Park project now involving over 200 innovative enterprises with their specialists. No additional investment is required for development. There will be a unified management system. We have discussed this with Mr Fursenko in great detail. And I would like to ask you to give the Ministry a directive to examine this issue again.

Vladimir Putin: All right. The special federal university network is a separate issue motivated by our plans to promote innovative development of certain regions. In this sense, Novosibirsk has a privileged status because you already possess a major scientific centre, the Siberian Branch of the Russian Academy of Sciences. Nonetheless, let us discuss ways of helping your ramified higher education system.

You have mentioned agriculture. In this connection, I would like to remind you that we have just decided to compensate petroleum, oil and lubricants (POL) expenses. I hope the farms will receive the funding and will use it efficiently in the present-day situation. This is the first aspect.

Second, I want to remind you about our previous decision to spend another 20 billion roubles ($740 million) on milk and fertilizer. In late 2008, we will re-examine the POL compensations issue and will continue to implement livestock-breeding programmes. You have some excellent agricultural mega-complexes in the region, including renovated Soviet facilities and new ones. Naturally, we must support them. We are also counting on support from the regional budget.

We will continue to implement livestock-breeding and interest-subsidy programmes and will do so in the future. I want to repeat once again that we would like to co-finance all these projects.

You have mentioned social problems. We have already talked about this during discussions of different issues in the course of the day. I want to remind you that the Russian Government has recently decided to boost funding for construction of new housing for people living in dilapidated blocks of flats.

This is a major nationwide problem, and your region is also afflicted with it. This year, we will spend another 50 billion roubles ($1.8 billion) on this objective from the Federal Housing/Municipal Utilities Reform Fund.

So, if you have an opportunity to purchase new housing and resettle tenants from rundown residential buildings, it is important to do it as quickly as possible and to submit your proposal.

I want to say a few words about housing prices, which should stay at the present level and reflect the current market situation.

Finally, we have already stated our intention to allocate 21 billion roubles ($770 million) to finance housing purchases for military personnel. I would also ask you to submit your proposal to the Defence Ministry and the concerned Government departments, so that we could promptly tackle these issues this year.

Viktor Tolokonsky: We have started working, and we can buy 1,410 nearly completed apartments before the year is out. These residential blocks will now have to pass the inspection and be registered.

Prices have indeed gone down. This will be acceptable for construction companies, will promote the development of the housing construction market and will make housing more affordable.

We have already submitted our proposals to the Regional Development Ministry. We will also contact the Defence Ministry on the issue of providing housing for military personnel because the process is similar and features three-year housing certificates issued by agreement with the Federal Housing/Municipal Utilities Reform Fund.

Naturally, such resources prop up the market which leads to solving many social problems.

Vladimir Putin: As I have already said, we have allocated another 50 billion roubles ($1.8 billion) from the Federal Housing/Municipal Utilities Reform Fund. The funding which was envisaged to be disbursed in the next few years is now listed in the 2008 balance sheet. Moreover, we are ready to additionally allocate as much money as can be converted into completed housing at this stage.