Transcript of the start of the meeting:

Vladimir Putin: What is the situation in your region?

Valery Shantsev: On the whole, the situation is under control. Needless to say, a drop in the consumer demand for the majority of cars and technical equipment is making it difficult for us. Car makers and the iron-and-steel industry have reduced their production, which translates into a streamlining of all expenses, including those on workers.

About 700 companies have reported an intention to cut down their number of employees by about 14,000.We had one of the lowest unemployment rates, and it now stands at 1.2%. 

Vladimir Putin: And what was it in the past?

Vladimir Shantsev: It was 0.46%. It has about tripled, but we still believe that we can control this level. We have 19,000 unemployed and 15,000 vacancies.

The ministry has approved our employment programme.

Vladimir Putin: Have you finished this work?

Valery Shantsev: Yes, we have, and have also guaranteed co-financing from our budget.

Vladimir Putin: How much federal and regional money will you have for the programmes to combat unemployment?

Valery Shantsev: About 320 million roubles. We have provided funds for retraining.

Vladimir Putin: In what areas? What will come after retraining?

Valery Shantsev: Public works, transfer from one place to another...

Vladimir Putin: How much more do you need?

Valery Shantsev: Some 28,500 jobs in public works. We have 2,000 seats in one hundred educational establishments, and personnel training from one to three months will be fully subsidised. About 6,000 people have quit their jobs since the start of the year, and about 3,500 found new jobs almost instantly. 

Vladimir Putin: What about a rise in public sector wages? Have you raised the wages of your budget-dependent workers to the federal level? What is the ratio?

Vladimir Shantsev: On January 1, we upgraded the minimum wage of public sector employees to 4,330 roubles - this was done for approximately one third of the total 250,000 people who we pay from our budget. Their pay has increased by about 60%. Starting April 1, we will increase wages and salaries for the remaining part, those who received more than the minimum pay and those who have the highest skills. We are planning to raise them by 27%. We have allocated six billion roubles in our budget for this purpose. However, for the first two months the budget is being put together at a loss of about 25%.

However, we still are not receiving any profits. January was practically a month off, and February is drawing to a close. In February, we will see what profits we have de facto. In the past, we received it in advance, whereas now we'll have it de facto. I think our adjustments will help us primarily in streamlining our development programme. We will submit it to the Legislative Assembly tomorrow. We wanted to build and rebuild 475 facilities, but will probably build a little more than 300. In 2005, we only had 12 facilities.

Vladimir Putin: I see. This was going to be my next question. Have you kept most of your investment programmes?

Valery Shantsev: Yes, we continue to build facilities that are co-financed from the federal budget. We are only reducing the number of new facilities. We have paperwork for them. They have gone through technical evaluations, and we have all documents on land allocation. If we receive profits, we won't start until April, because it is not rational to excavate sites. If everything returns to normal, we'll start excavating one site after another, and if not, we'll delay this work until next year.