17 november 2008

Prime Minister Vladimir Putin held a meeting of the Russian Government’s Presidium

Vladimir Putin

Meeting of the Government Presidium

"We have always honoured our commitments. Russia has always been a reliable partner. We told our Finnish partners recently that we are ready to postpone certain decisions because of the current international crisis. We do not want to create any additional problems, and are not going to do it. However, we will have to implement some of the announced decisions, and I would like to draw the attention of all the Government's members to this. We will have to carry them out to protect our national interests."

Transcript of the meeting's beginning:

Vladimir Putin: Good afternoon, colleagues. I would like to ask Alexander Zhukov to tell us about the main results of the session of the Russian-Spanish intergovernmental commission.

Alexander Zhukov: Mr Putin, the intergovernmental commission convened in Spain last week. I also met with Spanish Prime Minister José Luis Rodriguez Zapatero. We discussed development of trade and economic ties between our countries, and agreed to boost cooperation in energy, transportation, industry, construction materials, and tourism.

The Spanish Government and major businessmen, with whom I also met, expressed special interest in taking part in Russian infrastructure projects, primarily, the construction of roads, railways, and electric power stations. Incidentally, Spain has advanced technologies in these spheres, and extensive experience in building high-speed railways (Spain has Europe's longest railways), and roads. We agreed to establish special working groups on all of these directions, and will actively work with Spain.

Vladimir Putin: Thank you.

Mr Kudrin, you have been to Washington D.C., and met with your colleagues, the finance ministers of the world's 20 leading economies. Could you tell us about the meeting?

Alexei Kudrin: The G20 summit, which was attended by G20 finance ministers and their deputies, adopted a number of decisions. Russia and other countries will implement them in the near future.

First of all, this summit marked the start of creating a new financial architecture. One of the decisions provides for Russia's entry into the Financial Stability Forum (FSF) in the near future. This informal club of governmental, private and scientific organisations sets the rules for the world's financial markets. The summit decided to enhance its role and to invite several countries, including Russia, to join it. Thus, Russia will directly participate in working out new rules for the financial markets.

The summit decided that the new rules for regulating the financial markets, accounting and assessing risks on the financial organisations' balance-sheets, and new requirements for rating agencies should be established by the end of March. Most of the drafts should be ready by the end of March, and Russia will take part in their development.

In addition to this, the countries will boost their cooperation in drafting anti-crisis measures. The International Monetary Fund (IMF) will participate in these efforts. The summit decided to give the developing markets freer access to the IMF and the World Bank (WB). If need be, the question of providing additional resources will be discussed to enable the countries which are short of resources to receive them in the required amounts.

In line with the IMF Charter, which was earlier ratified by our Parliament, Russia is a direct participant of the IMF's entire financial operations to the extent of its share in the IMF and the WB. In general, the summit discussed the need to enhance the role of BRIC and other developing markets in the work of all international financial agencies.

Needless to say, support for the poorest countries was a separate item on the agenda. It is believed that the world financial crisis will have a considerable effect on them. Regrettably, they will lose part of their revenues, and will require additional aid.

All key documents which will become a response to today's challenges should be drafted over the next few months, by the end of March.

Vladimir Putin: I believe everyone here understands that this work will make sense only if it is conducted on an equal basis, and will not be reduced to attempts to use our resources for resolving problems we did not cause. I would like to ask you to work with the partners in this vein.

Alexei Kudrin: Mr Putin, the principles you have just mentioned were part of our written proposals to G20 and international financial organisations. It goes without saying that there should be parity, justice and transparency in the work of all financial institutions. The discussion of the need to increase the role of the developing markets is the result of our efforts in this work, which corresponds to our weight in the world economy.

Vladimir Putin: We have always honoured our commitments. Russia has always been a reliable partner. We told our Finnish partners recently that we are ready to postpone certain decisions because of the current international crisis. We do not want to create any additional problems, and are not going to do it. However, we will have to implement some of the announced decisions, and I would like to draw the attention of all the Government's members to this. We will have to carry them out to protect our national interests.

Mr Kiriyenko, your company took part in the tender for supplying nuclear fuel to some European countries, and not without success. Could you tell us about the results?

Sergei Kiriyenko: Mr Putin, a major event is taking place today. The Tvel Corporation, which is part of Rosatom (Nuclear Energy State Corporation), is signing an agreement with the Slovak power utility Slovenske Elektrarne. This was a very important tender for us because this was the last point to be supplied by the American Westinghouse, which had ousted us from Eastern and Central Europe.

This tender was particularly difficult because Slovenske Elektrarne no longer belongs to the Slovak Government but is owned by the Italian energy provider Enel. Therefore, the contest took place in a market environment, without any political influence, and we came ahead of Westinghouse. I am glad to report, Mr Putin, that we have fully recovered the market of Eastern and Central Europe.

The contact covers all units in Slovakia, including those which are under construction now. In figures, this means 0.5 billion Euros by 2015, and then there will be an auction for the contact's extension to the rest of the service life. This means several billion Euros, and complete return of Eastern Europe's market.

Vladimir Putin: This last tender you've won - how much money will it bring?

Sergei Kiriyenko: Right now, the exact figure is half a billion Euros by 2015. All in all, it will bring us about four billion Euros, if we count the station's entire service life.

Vladimir Putin: Excellent. My congratulations.

Is Mr Fursenko here? The work on national priorities in science and technology is practically over. Please, take the floor.

Andrei Fursenko: Mr Putin, we have completed our work on the long-term forecast of Russia's scientific and technological development until 2025. It took the ministry two years to complete it with the participation of more than 3,000 experts from business, science, and different governmental agencies. Today, this work is practically done. Stemming from the forecast, we drafted proposals on national priorities. They will be voiced at the meeting of Mr Ivanov's Commission.

We have not simply worked out the forecast and priorities, but also made proposals on the state's participation in implementing these priorities. After they are discussed by the commission, we will be ready to report on them to the Government.

Vladimir Putin: Good. Thank you. Mr Ivanov, please.

Sergei Ivanov: I am going to hold another meeting of the Government's Commission on Transportation and Communication. We will have two items on the agenda. First, we will discuss and approve the programme of Russia's regional information system development until 2010. We believe that this programme will enable us to make the management of the regions' socio-economic development more efficient, and to give the population access to the information on the work of regional authorities. We have many problems with that; often the local people simply do not know what the regional authorities are doing. We think that this will allow us to considerably improve the quality of state administration, and to develop the information and communications network in the regions since the programme is wholly meant for the regions.

Mr Putin, the infrastructure is indeed a big problem. Depending on socio-economic levels and financial resources, different regions are introducing information and communication technologies in a different way. This is an understatement, because the gap between the leading Russian regions and those lagging behind is huge. The programme stipulates that when the Communications Ministry earmarks federal funds to help the regions, the introduction of equipment and technologies should be coordinated. Different regions are using different equipment and technologies, and we want to avoid this.

Second, at the Commission's meeting we will discuss the establishment of a state company on managing and developing federal motorways. On October 1, we had a big meeting in your office on this subject. By now the principal differences between all ministries involved have been resolved. This company will be set up as a non-profit organisation. Let me emphasize this because it is important: This will not be a state corporation but a non-profit partnership. It will be in charge of federal motorways and the adjacent infrastructure, as we agreed at the meeting in your office.

We should discuss the relevant draft law at a meeting of the Government Commission, approve it, submit it to the Government, and then to the State Duma. I believe that we should be able to set up this company within the first six months of next year.

I would like to say a few words about roads. I am planning to go to Kaluga on Saturday. We will inaugurate the second bridge across the Oka River, which will hopefully remove another "clot" in the traffic arteries. This project provides for two bridges. I attended the commissioning of the first one last year, and in a year we finished building the second bridge. This is not a regional project because this road and the two bridges will secure steady traffic flow to all southern and western regions of the Central Federal District, as well as Ukraine and Belarus. This was a problem and now we have resolved it. Both bridges were built in a relatively short span of time: just three years. We are going to completing this project in a week.

Vladimir Putin: Mr Gordeyev, we have discussed different aspects of developing livestock breeding many times. Together the two of us attended the last exhibition of agricultural producers in Moscow. There, they raised a number of questions on stock farming. What is being done in this direction? This is the first question.

The second one is to the Ministry of Economic Development. We decided that since the work on our WTO entry is not proceeding as fast as we would like it to, we will have to make some adjustments and agree on them with our partners. I would like you to say a few words on this subject. Mr Gordeyev, go ahead, please.

Alexei Gordeyev: Thank you, Mr Putin.

If we look at the animal breeding results for the current year, we will see that the increase is rather big - more than 16% on poultry, and about eight percent on pork.

We have more modest results in milk production: only a 1.5% increase. Mr Zubkov instructed us to develop a special programme to boost production of milk and beef farming as part of the federal programme, starting from next year.

You have also told us to review the work of certain spheres. We held an extended meeting of the board in Oryol, to which we invited representatives from more than 20 major producing regions. We discussed long-term development and the prospects for next year.

Now I would like to say a few words about the development until 2020. Our programme fits into the general national development concept, and the tasks we have set for ourselves are realistic: to increase pork production by 2.2 times, and to build up livestock by 1.8 times. Now, we realise that everything depends on the use of new technologies and selective breeding. There are concrete examples when the introduction of new technologies makes it possible to increase production by 2.5 times, and labour productivity grows 10 times. This is what we discussed.

Next year, despite the difficult financial situation, we consider it important to upgrade pig breeding by about 10%. To achieve this important task, we have coordinated our positions with the Ministry of Economic Development, and asked Mr Zubkov to reduce the non-quota pork by 200,000 tons next year. We should be able to make up for these 200,000 tons by boosting domestic production.

We have also coordinated our position on poultry with the Ministry of Economic Development. We have asked it to reduce the quota by 300,000 tons next year since our poultry farms can easily make up for this amount. The position has been coordinated. Now the Government needs to issue a resolution. This should be done a month before the next calendar year.

Thank you.

Elvira Nabiullina: Mr Gordeyev told us about the coordinated positions. We have suggested reducing import quotas proceeding from the ability of our domestic producers to increase the output of pork and poultry. These two types of meat are most relevant at present. The quotas are calculated with a view to preventing price hikes on the domestic market. We have proposed a balanced cut in quotas. This is our shared position.

Now we are discussing this issue with our partners, including in the United States. We should coordinate these quotas and make a decision by December 1.

Vladimir Putin: Please, do not delay. Thank you.

Mr Kozak, I have instructed you and other colleagues to coordinate decisions on increased funding and fast resolution of problems linked with dilapidated housing and repairs that are long overdue. How are you doing on this front?

Dmitry Kozak: We held a meeting only today where we discussed prompt measures to support the construction and housing markets. The bill earmarking 50 billion roubles for resettling people from dilapidated housing has already been approved in the first reading. It will be reviewed in the second and third readings on November 21. Since all positions have been coordinated, we are working in parallel on delegated legislation so that as soon as the bill is signed by the President and published, we can embark on its implementation.

Vladimir Putin: Are you talking about buying housing that is ready to be inhabited or which is about to be completed?

Dmitry Kozak: Yes, these 50 billion from the fund are primarily meant for housing. We have made our position clear. We will buy almost completed housing to help builders finish it, and enable people taking part in shared construction projects move into this housing. I hope that by the end of November, as soon as the bill is signed and we are able to start implementing it, everything will be ready, and all the necessary documents drafted.

I would also like to say just a few words about the fund's work. I think it is vital information. Today, the fund has allocated 40.5 billion roubles to the regions for capital repairs and demolition of dilapidated housing. This figure will increase to 65 billion roubles if we consider the contributions from the regional budgets. In this way, we will enable more than five million people to improve their housing conditions, and resettle 30,000 families from rundown buildings, in addition to other immediate measures which are now being planned. This money has been spent on the capital repairs of 13,500 buildings, and the current work on another 13,500 buildings.

As you instructed us last spring, it is also important to protect this money against inflation. We have deposited all funds which are not being used now, and will not be used in the near future, altogether 200 billion roubles, in commercial banks. So far we have already received an interest of 8.3 billion roubles. This money will also be used for capital repairs and demolition of dilapidated housing.

Vladimir Putin: Thank you.

Mr Serdyukov, we have also agreed that we will address the housing problems of army servicemen without delay. Additional funds have been envisaged for this purpose this year. You were supposed to coordinate this with the Finance Ministry.

Anatoly Serdyukov: We are working on this.

Vladimir Putin: How long will you be working? Time is running out, it is the end of November already.

Alexei Kudrin: The money has already been allocated. Adjustments to the law on the budget for 2008 and the ensuing periods have already been made, and the Defence Ministry will be able to use this money.

Vladimir Putin: Please, coordinate this with Mr Basargin. It is necessary to find out which regions have already enough ready-to-use housing or housing in the last stages of construction, so as to use the funds for this purpose, to resolve housing problems of army servicemen without delay.

We have many items on the agenda. One of the main issues is next year's plan for drafting legislation. The project submitted contains 37 drafts, including such priorities as the development of the financial market, consolidation of defence and security, and elimination of legal gaps in social spheres.

I would like to start with Mr Basargin's report on the results of the national contest for the title of Russia's best city in 2007.

Viktor Basargin: Mr Putin, members of the presidium, the annual national contest for the title of Russia's best city is being held in line with the Presidential decrees and the Government's resolutions.

Its main aim is to compel the authorities to step up the development of housing and public utilities. It is a way of monitoring their condition, finding new approaches to the implementation of the reform in this sphere, and sharing positive experiences of the local authorities.

I would like to note that this is the 10th contest, so it's an anniversary. By tradition, the contest is held in two stages. First, it takes place in the regions, and then its winners compete nationwide.

In the last decade, more than 4,000 cities and towns took part in the first stage of the contest. The most active participants were Bashkortostan, Tatarstan, the Khanty-Mansi Autonomous Region, the Stavropol, Krasnodar and Khabarovsk territories, and the Belgorod, Vladimir, Leningrad, Lipetsk, Moscow, Nizhny Novgorod, Samara, Sverdlovsk, Ulyanovsk and Chelyabinsk regions.

The contest can be won only by those cities or towns which provide urban amenities, engage in landscape gardening, reform their housing stock, utilities and the administration system, and raising the standard of living.

Until this year, the bonus fund was 100,000 million roubles. Starting with this year, it will be brought to 400 million. The contest is held in three categories.

The first category includes the regions' capitals. Cities with more than 100,000 people are in the second category, while towns with less than 100,000 are in the third category. More than 700 participants competed in the preliminary stage of the 2007 contest. Towns with fewer than 50,000 people took the most active part in the contest. Forty-nine regions applied for participation in the nationwide contest.

The Ministry for Regional Development has set up a commission to sum up the results. It determined the main criteria. The Ministry for Regional Development backed the commission's decisions. We suggest that in the first category, the Russian Government's first class certificate and the cash bonus should be given to the city of Novosibirsk.

Vladimir Putin: You mean 400 million roubles?

Basargin: This amount will be divided between the three categories. In this case the prize will be a little over 130 million. In each group, the winner will receive almost 50%, or about 60 million roubles.

Vladimir Putin: I have not understood a thing. Let's start from the beginning.

Basargin: These 400 million roubles will be divided between the three groups in proportion, that is, 133 million per group on the average.

Vladimir Putin: Everyone will get an equal share? Regardless of how many people live there?

Basargin: This is what the commission has proposed.

Vladimir Putin: All right, let it be so. So Novosibirsk has won in the first category.

Basargin: That's right. Bratsk has won in the second category and Reutov in the Moscow Region in the third one.

Second class diplomas and first category cash bonuses have been awarded to Khabarovsk, Ulyanovsk, and Saransk. In the second category, the second place has been awarded to Novorossiysk and Almetyevsk (Tatarstan), and in the third category, the second place has been given to Vyborg (Leningrad Region), Gorodets (Nizhny Novgorod Region), and Khvorostyanka (Samara Region).

Tyumen, Krasnoyarsk, and Nalchik won the third place in the first category. Komsomolsk-on-Amur, Oktyabrsky (Bashkortostan), and Cherepovets (Vologda Region) won the third place in the second category. Vidny (Orlov Region), urban- Aginskoye (Trans-Baikal Territory), and Yessentuki (Stavropol Region) have been named third in the third category.

I suggest that we approve this decision of the commission and the Ministry for Regional Development.

Vladimir Putin: Any questions?

Alexei Gordeyev: Can I make a proposal?

Vladimir Putin: Please, go ahead.

Alexei Gordeyev: Mr Putin, we made this proposal last year. It makes sense to set up a fourth category for rural communities.

Vladimir Putin: Mr Gordeyev, I am sorry for interrupting, but let us first make a decision on this issue. Does anyone have any questions, remarks, or proposals?

Are there any? None.

There has been a proposal to support this decision. We are approving this decision, and would like to congratulate all those who have worked hard and received both the well-deserved prize, both moral satisfaction and a cash bonus. Thank you for organising this work.