The following issues are scheduled for discussion at the Government Presidium meeting on June 1, 2009.
1. The implementation of the Federal Budget for 2008
I. General parameters of the implementation of the Federal Budget for 2008
Since September 2008 the Federal Budget has been implemented within the context of the world financial crisis which resulted in a slowing of economic growth. In 2008 the GDP amounted to 41.540 trillion roubles, an increase of 5.6% over 2007 (consecutively slowing from 8.5% in the first quarter, to 7.5% in the second, to 6.2% in the third, to 1.1% in the fourth). Inflation amounted to 13.3% (compared with 11.9% in 2007). The Federal Budget revenue for 2008 was 9.2759 trillion roubles. Federal Budget spending during the said period in cash was 7.5709 trillion roubles. The Federal Budget surplus was 1.705 trillion roubles.
The following shows the dynamics of the basic parameters of the implementation of the Federal Budget over the last five years (in % of GDP):
|
|
2004 |
2005 |
2006 |
2007 |
2008 |
|
Revenue |
20.1 |
23.7 |
23.3 |
23.5 |
22.3 |
|
Expenditure |
15.8 |
16.3 |
15.9 |
18.1 |
18.2 |
|
Surplus |
4.3 |
7.5 |
7.4 |
5.4 |
4.1 |
II. Federal Budget revenue
1. The tax revenues of the Federal Budget for 2008 amounted to 5.2327 trillion roubles (12.6% of GDP), 114.2 billion roubles or 2.2% more than the forecast for 2008.
The bulk of the tax revenues of the Federal Budget came from the Value Added Tax (40.7% of the total tax revenue), the Mining Tax (30.7%), the Profit Tax (14.5%), the Unified Social Tax (9.7%).
2. The non-tax revenues of the Federal Budget (less gratuitous contributions) for 2008 amounted to 4.0419 trillion roubles (9.7% of GDP) which is 195.9 billion roubles or 5.1% more than the forecast revenue for 2008. In the structure of non-tax revenues, customs duties accounted for 86.2%.
III. Federal Budget expenditure
1. On the whole, the expenditure of the Federal Budget for the report period amounted to 7.5709 trillion roubles or 97.8% of the updated budget itemization for 2008. The non-interest cash expenditure of the Federal Budget in 2008 amounted to 7.4175 trillion roubles or 97.8% of the adjusted budget itemization (in 2006 4.112 trillion roubles or 96.5% of the total expenditure; in 2007 5.8344 trillion roubles or 91.5% of the total expenditure).
2. The cash expenditure on the implementation of Priority National Projects for the report period amounted to 283 billion roubles (94.6% of the updated budget itemization), of which by project:
|
Name of Priority National Project |
2008 (billion roubles, as a % of updated budget itemization) |
|
Healthcare |
96.8 (99.1) |
|
Affordable and Comfortable Housing for Russian Citizens |
140.8 (90.5) |
|
Education |
45.4 (99.0) |
In addition, 2008 expenditure on the project State Programme of the Development of Agriculture and Regulation for the Markets of Agricultural Produce, Raw Materials and Food for 2008-2012 amounted to 118.2 billion roubles (99.9% of the updated budget itemization).
IV. The size of Government debt and the Reserve Fund and the National Welfare Fund
The size of the Government debt as of January 1, 2009 was 2.692 trillion roubles. As of January 1, 2009 the size of the Reserve Fund was 4.0276 trillion roubles and of the National Welfare Fund 2.5845 trillion roubles. During 2008 the Reserve Fund increased by 958.6 billion roubles and the National Welfare Fund by 1.8017 trillion roubles.
2. Implementation of the budget of the Pension Fund of the Russian Federation for 2008
The Fund's budget was formed in 2008 in accordance with the rates of the Unified Social Tax and other taxes established under the Tax Code of the Russian Federation as well as from insurance contributions, reserves transferred from the Federal Budget and other proceeds.
The actual implementation of the budget of the Fund for 2008 in revenue was 2.7302 trillion roubles (104.2% of the budget projections) and in terms of expenditure, 2.3578 trillion roubles (99.4%). In 2007 the budget of the Fund was implemented 101.7% in terms of revenue and 100.2% in terms of expenditure.
The resources of the Federal Budget transferred to the Fund in accordance with the laws of the Russian Federation to finance government pensions, additions to pensions, additional material provisions, allowances and compensations have been transferred to the Fund in the full amount of 153.1 billion roubles, which accounts for 6.5% of the total expenditure of the Fund (5.3% in 2007), and to cover the Fund's budget deficit of 197.1 billion roubles.
The Federal Budget reserves transferred to the Fund for monthly payments and the payment of additional monthly benefits (to invalids, veterans, Heroes of the Soviet Union, Heroes of the Russian Federation and other categories of citizens) totaled 250.3 billion roubles (100% of the target).
The revenues of the Fund's budget intended to finance the contributory part of labour pensions as of January 1, 2009 amounted to 269.9 billion roubles (104.6% of budget targets) of which the revenues from temporary investment of pension savings amounted to 13.8 billion roubles.
During the report period pension savings increased by 252 billion roubles (by 1.5 times) to 725 billion roubles as of January 1, 2009, of which pension savings transferred into trust management by managing companies accounted for 312.9billion roubles, of which the amount transferred to the state managing company (VEB) was 302.4billion roubles.
Spending on mandatory pension insurance increased by 533 billion roubles compared with 2007 to 2.0194 trillion roubles in 2008 (100% of the target) of which: the spending to pay labour pensions 1.8774 trillion roubles or 99.9% of the target.
Beginning January 1, 2008 the base labour old age pension was established at 2,340 roubles (from August 1, 2,691 roubles) for pensioners who have spent long periods working in the Far North and areas equated to it, and accordingly all other base labour old-age and disability pensions for this category of citizens have been raised.
As of August 1, 2008 the base labour old-age pension was set at 1,794 roubles (an increase by 15%) with simultaneous proportional increase of the size of all the other base parts of old-age, disability or loss-of-breadwinner pensions.
On February 1 and again on August 1, 2008 the insurance part of the labour pension for all the pensioners was increased by respectively 12% and 8%, and on April 1, 2008 the insurance part of the labour pension was raised by a further 7.5% (bringing the total increase to 30%).
As a result of the pension increases in 2008 the average size of old-age labour pensions increased by 939 roubles or 25.3%, while prices in 2008 increased 13.3%, and at the end of the year amounted to 4,652 roubles, the size of the social pension was 3,007 roubles and for persons living in the Far North and areas equated to the Far North the average labour old-age pension was 6,524 roubles. At the end of 2008 the ratio of the size of the old-age labour pension and the pensioner's minimum cost of living amounted to 125.6% compared with 110.4% in 2007.
Monthly payments to invalids, veterans and other categories of citizens increased by 8.5% on April 1, 2008 and by 10.5% (compared with April 1, 2008) on July 1, 2008.
As of late 2008 incomes, including monthly payments and additional monthly benefits for war invalids amounted to 15,254 roubles, for veterans of the Second World War to 15,151 roubles and for the widows of servicemen who died in action during the Second World War to 11,248 roubles.
The current expenditure of the Fund amounted to 49.1 billion roubles or 98.5% of the budget target. The spending on the operation of the Fund's agencies in 2008 was 47.2 billion roubles, or 98.5% of the target and 2.1% of the total expenditure of the Fund (2.4% in 2007).
The budget of the Fund in 2008 was implemented with a surplus of 120.4 billion roubles under current obligations and a surplus of 252 billion roubles for the contributory part of the budget.
3. Implementation of the budget of the Social Insurance Fund of the Russian Federation for 2008
The revenues of the Fund's Budget for 2008 amounted to 360.5 billion roubles (98.5% of the budgetary target) and the expenditure to 379.4 billion roubles (97.4%). In 2007 the Fund's revenues were 104.1% of the target and expenditure, 99.0% of the target.
The Unified Social Tax transferred to the Fund in 2008 amounted to 222.6 billion roubles or 96.3% of the target (in 2007, 106.4%). Other taxes (collected under the simplified system, on imputed income, etc.) amounted to 10.1 billion roubles or 101.3% of the target (110.4% in 2007).
The decline of revenues from the Unified Social Tax is the result of the wage compensation fund being less than targeted, the fall of the effective tax rate and the increased number of tax payers who switched to special tax schedules.
Contributions towards social insurance against industrial accidents and occupationsl illnesses amounted to 59.1 billion roubles or 105.2% of the target (108.4% in 2007). The insurance premium collection coefficient was 98.2% against the targeted 97.5%, and the average tariff weighted by sector was 0.54% compared with 0.52% of the target.
The main part of the expenditure of the Fund (237.6 billion roubles or 62.6% of all expenditure, 59.5% in 2007) was used to pay temporary disability, maternity, childbirth allowances, allowances for care of children up to 1.5 years of age and other mandatory social insurance benefits.
The expenditure for these purposes in 2008 amounted to 98.4% of the budgetary target (102.3% in 2007).
About 16.5 billion roubles, or 99.5% of the targeted amount was spent on children's health. The spending under that budget item increased by 7.9% over 2007, with 5.1 million children of insured citizens receiving accommodation at children's health camps.
The spending on accommodation at sanatoria and convalescence after stationary hospital treatment amounted to 4.3 billion roubles or 99.1% of the target. More than 191,500 vouchers have been subsidized, which is 23,400 more than in 2007.
Insurance payments and other mandatory social insurance payments against industrial accidents and occupational illnesses amounted to 46.7 billion roubles or 93.7% of the budgetary target, which is mainly due to the decrease of insurance payments.
The Federal Budget in 2008 financed the Fund's spending to pay legitimate allowances to citizens exposed to radiation as a result of accidents and nuclear tests as well as social assistance to individual categories of citizens in the form of treatment at sanatoria and holiday resorts, providing invalids with technical means of accommodating their disabilities, payment of childcare allowance to non-working citizens through the child's first 18 months. A total sum of 49.8 billion roubles has been transferred to the Fund from the Federal Budget (the total amount targeted). In 2008 medical assistance to women in the prenatal and postnatal period as well as outpatient medical assistance to working citizens in the total amount of 16.7 billion roubles was financed by the Fund out of the money transferred from the Federal Mandatory Medical Insurance Fund.
In 2008 the Fund saved 12.3 billion roubles on the upkeep of the staff of the executive bodies, or 95.4% of the target (the share in the spending was 3.2%).
In 2008 the Fund reported a deficit of 18.9 billion roubles. The Fund's budget deficit was financed by the balance of the money earmarked for mandatory social insurance which stood at 34.3 billion roubles as of January 1, 2009.
In 2008 the Fund fulfilled its obligations of social insurance and the government functions delegated to it.
4. Implementation of the budget of the Federal Mandatory Medical Insurance Fund for 2008
The Fund's revenues in 2008, approved under Federal Law No.184-FZ of July 21, 2008 On the Budget of the Federal Mandatory Medical Insurance Fund in 2008 and in the Planning Period of 2009 and 2010 amounted to 130,595,429,700 roubles, the expenditure in the amount of 133,022,015,700 roubles, with a deficit of 2,426,586,000 roubles to be covered by the carryover of the Fund budget money.
The revenues of the Fund's budget in 2008 amounted to 162,620,885,300 roubles of which total inter-budget transfers from the Federal Budget were 73,175,016,200 roubles, of which 30,857,207,800 roubles were spent to deliver to certain categories of citizens additional free medical assistance in the form of medicines, medical supplies as well as dietetic nutrition for disabled children. The Fund's proceeds from the Unified Social Tax for 2008 amounted to 88,273,682,600 roubles, which is 1,042,682,600 roubles (or 1.2%) above the target.
The tax on aggregate income entered into the Fund's budget amounted to 1,005,455,600 roubles, or 99.0% of the target.
Proceeds from payments towards shortfalls, penalties and other financial sanctions on contributions to the Fund in connection with arrears as of January 1, 2001 amounted to 14,336,100 roubles, or 52.3% of the target.
The Federal Budget spending on targeted financing in accordance with the laws of the Russian Federation amounted to 73,175,016,200 roubles or 45.0% of the total revenue of the Fund, of which:
23,061,783,700 roubles to implement measures under the Priority National Project on Healthcare, of which:
19,190,579,600 roubles for district physician pay, pediatricians, general practitioners (family doctors), assistant nurses (for said doctors) qualified to be entered in the Federal Register of Medical Professionals (100% of 2008 target);
3,871,204,100 roubles for additional medical checkups of working citizens, or 100% of the annual target;
300,857,207,800 roubles from the Federal Budget to finance state social subsidies of medicines for certain categories of citizens, or 100% of the annual target;
3,538,700,000 roubles for mandatory medical insurance of the non-working population (children), or 100% of the 2008 target of the Fund's budget;
721,343,000 for medical checkups of orphans in stationary care and children in unfavorable life circumstances, or 100% of the budgetary target.
Other revenues, considering the payment into the Federal Budget of 8,455,600 roubles and into the budgets of regional mandatory medical insurance funds of 20,200 roubles amounted to 152,394,800 roubles in 2008.
The Fund's assets were spent to fulfill its statutory requirements in accordance with the approved budget.
The Fund's budget expenditure in 2008 was 168,706,056,300 roubles, or 94.4% of the expenditure approved for 2008 under the aggregate budget. Shortfalls on the targets were due to lack of demand for the targeted amounts for medical checkups of orphans in stationary care and children in unfavorable life circumstances in connection with the updating of the figure of the number of children taken into account in planning financial outlays in connection with the change of the contingent of children subject to medical examination, with active government policy of social adaptation of orphans aimed at placing them in families, the transition of orphans put on the schedule of mandatory medical checkups into the age category not subject to mandatory checkups, a policy actively pursued in the Russian regions.
The Fund's expenditure financed out of the Federal Budget, including the balances of the Fund as of January 1, 2008 due to unused Federal Budget money amounted to 79,978,586,800 roubles.
The Fund issued subsidies in the amount of 71,279,396,200 roubles to level the financial conditions of the regional mandatory medical insurance funds in financing regional MMI programmes for budgets of regional MMI funds in 2008, including for the implementation of regional MMI programmes as part of the basic MMI programme in the amount of 63,279,396,200 roubles, of which 19,092,516,500 roubles came from the insurance reserve quota and 2,363,579,700 roubles out of the money reserved in the FMMI for 2008.
The cost of implementing regional MMI programmes in the Russian Federation as a whole amounted to 415,887,580,600 roubles in 2008.
The tax revenues amounted to 162,108,172,100 roubles or 39% of the total amount, the insurance contributions for MMI of the non-working population to 178,961,312,300 roubles, or 43%.
Pursuant to Decree # 515 of the Government of the Russian Federation of July 14, 2008 On the Procedure of the Use in 2008 by the Federal Mandatory Medical Insurance Fund of the assets of the insurance reserve quota subsidies from the FMMI were made available to regional FMMIs to reduce the deficit of funding regional MMI programmes and enhance the implementation of regional MMI programmes.
Prior to FMMI subsidies the deficit of regional MMI programmes ranged from 1% in the Khanty-Mansi Autonomous Area to 42% in the Kabardino-Balkarian Republic and 72% in the Chechen Republic.
As a result of subsidies, the deficit of the regional MMI programmes dropped substantially (to 12% in the Kabardino-Balkarian Republic and 17% in the Chechen Republic).
On the whole the number of Russian regions which reported a deficit of regional programmes dropped substantially. Prior to the subsidies the number of Russian regions with a deficit in regional programmes was 67, that number dropped to 43 after the subsidies, of which more than 20% deficit was reported by 43 before the subsidies and by 4 after the subsidies.
The share of FMMI subsidies in the incomes of regional FMMIs for the fulfillment of regional MMI programmes varies from 1.7% in the Chukotka Autonomous Area to 72% in the Chechen Republic, which is due to the level of budget sufficiency of the corresponding Russian regions and the amount of regional tax revenues and their own insurance contributions for MMI of non-working population.
The biggest percentage of FMMI subsidies to a regional programme belongs to the Republic of Ingushetia with 68% of the regional FMMI accounted for by subsidies, the figures for the Republic of Daghestan being 63% and the Trans-Baikal area for 57%.
On the whole, across the Russian Federation the regional MMI programme has been implemented without deficit in 2008, considering subsidies from the FMMI. In 71 regions of the Russian Federation the actual per capita financial support of the regional MMI programme exceeds the approved federal quota.
Considering FMMI subsidies, the average Russian per capita quota of financial support of the regional MMI programme in 2008 stood at 3,187.99 roubles, which exceeds the approved federal quota of 2,207.1 roubles by 44.4%. The per capita quota ranges from 22,532.81 roubles in the Chukotka Autonomous Area to 1,544.13 roubles in Ulyanovsk Region. In 26 regions of the Russian Federation the federal quota was exceeded by 50% or more.
14 regions of the Russian Federation reported a deficit in regional MMI programmes: the per capita quota of financing amounted to 85.2% of the federal quota in the Republic of Ingushetia, 88.42% in Tula Region, 92.61% in Kostroma Region, 94.01% in the Chuvash Republic and 96.03% in Tambov Region. In the report year the budgets of regional MMI funds received money from the Federal Budget for mandatory medical insurance of non-working population (children) in the amount of 3,538,700,000 roubles, or 4.0% more than in 2007. The distribution of the assets directed for the above purposes to the budgets of regional MMI funds among the regions of the Russian Federation will be found in Supplement 5 to this Federal Law.
The balance of the Fund's budget assets as of January 1, 2008 formed due to incomplete use of budget allocations approved under Federal Law No.243-FZ of December 29, 2006 On the Budget of the Federal Mandatory Medical Insurance Fund for 2007 to finance a pilot project in the regions of the Russian Federation aimed at upgrading the quality of performance-based healthcare services with gradual transition to single-channel funding, in the amount of 3,351,394,800 roubles, was transferred from the budget of the Fund to the budgets of the territorial MMI funds involved in the implementation of the said pilot project in 2008.
In 2008 the federal MMI Fund earmarked 16.6 billion roubles for the services of federal and municipal healthcare institutions, for medical assistance to women during pregnancy and childbirth as well as for medical checkups of the child during the first year of life. In the report period the Fund transferred 16.6 billion, or 100% of the annual target, to the budget of the Federal Social Insurance Fund as payment for said services.
The budget of the Federal Social Insurance Fund has received 61,302,900 roubles to complete settlements in the first quarter of 2008 under contracts signed in 2007 for additional payment for primary medical assistance rendered by outpatient medical centres to working citizens as part of the regional MMI programme out of the balance of the Fund's budget as of January 1, 2008.
In January-December 2008 the federal MMI Fund transferred to the regional MMI fund subventions to finance the fulfillment of the government target of rendering additional medical assistance in the amount of 20,996,951,900 roubles, or 94.3% of the Fund budget.
In the report period financing proceeded under the Rules of Federal Mandatory Medical Insurance Fund Subventions to the Regional Mandatory Medical Insurance Funds to finance the fulfillment by the healthcare institutions of municipalities that provide primary medical assistance (and in the absence thereof by corresponding healthcare institutions of the region of the Russian Federation ) of the Government target of rendering additional medical assistance approved by Decree No. 864 of the Government of the Russian Federation of December 12, 2007.
In 2008, as part of the Priority National Project on Healthcare, the Fund financed the cost of additional medical checkups of working citizens. These costs were paid out of the Federal Budget in accordance with the procedure, in amounts and on the terms set by the Government of the Russian Federation. The regional MMI funds received 5,685,056,000 roubles (99.1% of the fund budget target) for the above purposes.
The funding of the cost of state social assistance to certain categories of citizens by providing them with medicines in 2008 and of completing, in the first half of 2008, payments for actual provided medicines in 2007 53,907,858,600 roubles were transferred to the budgets of regional MMI funds in 2007, of which: 23,050,650,800 roubles to complete in the first half of 2008 settlements for actual provided medicines in 2007, of which: 14,995,981,700 roubles is Federal Budget money earmarked for activities under the basic programme of mandatory medical insurance, considering repayment into the Federal Budget of 4,018,300 roubles, 54,669,100 roubles is the balance of the Fund's assets as of January 1, 2008 formed due to the return by the regional mandatory medical insurance funds of the money not used to render state social assistance to certain categories of citizens by providing medicines, 8 billion roubles were subsidies of the Fund stipulated under Supplement 8 to the law the balances of which, in the second half of 2008 are to be used by regional mandatory medical insurance funds to fulfill regional mandatory medical insurance programmes as part of the basic programme of mandatory medical insurance in 2008.
The cost of financial and material-technical support of the activities of the Fund and informatization of the MMI system was 786,770,400 roubles, or 96.3% of the target of the Fund's budget.
5. Draft Strategy for the Development of Light Industry in the Period until 2020 and the Plan to Implement It
The Strategy takes into account the national interests of Russia (enhancing the standards and quality of life, the health of the nation, strategic and economic security of the state), proposals made by the regions of the Russian Federation, non-governmental organizations and associations on measures to support this sector in priority development areas.
The strategy's main objective is the transition of light industry to an innovative development model. Particular attention is paid to protecting the domestic market from the shadow economy, retrofitting and modernization of production, import replacement and export.
Light industry in the Russian Federation today is a very important, diversified sector of the economy capable of attracting innovation.
The contribution of light industry to industrial output in Russia today is about 1% (in 1991 it was 11.9%, i.e. on a par with the developed countries, such as the US, Germany and Italy where that indicator has hovered at 8-12% over many years), and its contribution to export is 1.3%.
At present light industry comprises 14,000 large, medium-sized and small companies located in 72 regions. About 70% of them are in single-industry towns. The sector employs 462,800 persons, 75% women. Scientific support of the sector is provided by 15 research and design institutions many of whose developments match or surpass world standards.
The spearhead industries that determine the industrial and economic policy of the sector are located in the central (55 enterprises), Volga (30) and Southern (17) Federal Districts, which account for the largest share of output and are the most important socially.
This industry's performance in the first quarter of 2009 has shown that during the crisis it is capable of increasing output in subsectors directly oriented towards the market. It should be noted that as a result of the crisis the range of goods imported into Russia has been shrinking dramatically. That offers domestic light industry strategic opportunities for filling the vacated niches and strengthening its positions in the market.
In 2008 retail sales of light industry products amounted to 2.0 trillion roubles, its share of the total retail trade was 14.5% and in retail trade in non-food products, 26.3%.
In terms of consumption, light industry products come second after food and far ahead of the markets for household electronics, cars and other goods. Considering the macroeconomic indicators and development trends, the light industry market may exceed 3.3 trillion roubles by 2020.
The existing preferences and the way problems at the federal and regional levels are addressed are still insufficient to offset the impact of the negative factors on the development of the sector and make it a competitive and developing sector and for domestic producers to strengthen their positions in the internal market and compete as equals in the world market not only with producers from China, Turkey, India and other developing countries, but also with the EU countries and the US.
The world financial crisis has compounded the situation in the sector. In connection with the crisis even the enterprises which have made progress in innovation in recent years and paid considerable attention to modernizing production had and will continue to have to cut production and refrain from long-term investment in the coming years. This is due to difficulties in obtaining bank loans (the share of borrowed money in the turnover assets reached 40% in recent years), on the one hand, and to the increase in official import, counterfeit and contraband products, falling demand and the slowdown in the sale of many types of consumer and production goods, and the shedding of jobs, on the other hand.
Lack of cardinal measures to address problems will have a severe impact on the economy of the sector, its technological lag in the foreseeable future may become irreversible leading to the degradation of science-intensive production, increased dependence on imports; government losses will grow exponentially jeopardizing the strategic and national security of Russia.
The current situation can only be changed by developing and implementing anti-crisis measures and measures aimed at boosting the economy of light industry, giving it a new impetus in innovation, social and regional development, and enhancing the competitiveness and productivity at the new technological level. Today the sector meets only a quarter of the population's solvent demand and the country's mobilization demand - only for 17-36%, which is in breech of the law on the security of the state whereby domestic industry should provide at least 51% of all strategic goods. Therefore light industry today faces new challenges and tasks whose solution calls for new approaches in the short and long term. Accordingly, the aim of the Strategy is to create conditions for accelerated innovative development of light industry in Russia, to ensure that the volume of output, the quality and range of products meet the aggregate demand of consumers and to enhance the national importance of the industry and its image in the world community.
The goals and tasks of the Strategy align with the state policy in the field of innovative and social economic development of Russia in the medium and long term.
The Strategy is to become a major instrument in solving the problems of the sector and is to link the task of its economic growth with providing for the demand of the country's citizens, the military and security agencies and related sectors for quality and affordable consumer goods, and technical and strategic products.
The implementation of this strategy will enable light industry in Russia to become an industrially developed sector providing thousands of people with jobs, enhancing the well-being of the workers while strengthening the country's strategic and economic security.
The main result of the Strategy is the transition of light industry to a qualitatively new model of innovative, economic and social development resting on a new technological and scientific foundation, new methods of management and the interconnection between science, production and business. It should ensure that the volume of production, quality and range of product effectively meet the aggregate demand of the Russian and world markets.
6. Draft federal law On Introducing an Amendment to Article 27 of the Federal Law On Gas Supply in the Russian Federation
Associated (oil well) gas is a valuable chemical raw material and an effective fossil fuel. Unlike natural combustible gases consisting mainly of methane, associated gas contains a significant quantity of ethane, propane, butane and other straight-chain hydrocarbons. The processing of associated gas yields, dried gas and valuable raw material consisting of the broad fraction of light hydrocarbons used in the chemical and petrochemical industries as well as liquefied gas.
At present large amounts of associated (oil well) gas are used wastefully: about a quarter (14 billion cubic metres in 2006) of the resources are flared which leads to discharge of pollutants into the atmosphere and involves direct economic losses.
There are limited possibilities for the use of oil well gas in the areas where it is extracted (it can mainly be done by organizations that extract oil in the European part of the country as well as by OAO Surgutneftegaz whose fields are located in the proximity of the GRES-1 and GRES-2 hydroelectric power plants in Surgut). One reason for this situation is the limitation in existing procedure of access of oil extracting organizations to gas transportation networks.
The President of the Russian Federation has instructed the Government of the Russian Federation to impose harsher sanctions for the burning of associated (oil well) gas which may, in the absence of proper access to the infrastructure for the suppliers of the products of its processing, push oil prices down and accordingly reduce the national budget revenue and consequently slow the country's economic development.
To solve these problems it is necessary to introduce an amendment in Article 27 of the Federal Law No. 69 FZ of March 31, 1999 On Gas Supply in the Russian Federation to allow suppliers of dry gas obtained through the processing of associated (oil well) gas, priority access to gas transportation systems.
The adoption of the law would help to bring down the amounts of associated (oil well) gas flared and, as a consequence, ensure rational and comprehensive extraction of useful components from minerals and the supply of the Russian petrochemical industry with raw materials.
7. Draft federal law On Accession of the Russian Federation to the Convention Concerning International Carriage by Rail (COTIF) of May 9, 1980 in the version of the Protocol Modification of June 3, 1999
The accession of the Russian Federation to the Convention Concerning International Carriage by Rail (hereinafter COTIF or Convention) is aimed at providing legal support for the organization of rail-ferry links between ports of the Russian Federation and the Federal Republic of Germany.
The Convention Concerning International Carriage by Rail was signed in Bern on May 9, 1980 in order to facilitate and speed up international rail administrative processing by bringing in marine transport and establishing uniform rules in the sphere of international cargo and passenger carriage. As of today, 43 countries have joined the Convention, including the countries of the European Union as well as some Asian and African countries.
The accession of the Russian Federation to the COTIF will make it possible to use a single waybill both on the rail and marine sections of the route in carrying cargo by rail and ferry between Russia and Europe along the Baltiisk-Sassnitz/Mukran (Germany) and Ust-Luga-Sassnitz/Mukran (Germany) line as well as other European ports. This waybill will be used in rail carriage throughout Europe and on certain sections of railways stipulated by the Russian Federation while on Russian territory.
The Draft Federal Law envisages the accession of the Russian Federation to the Convention with the following caveat:
The connection of sections of railway track adjacent to port ferry complexes will facilitate the custom clearance of cargo and cut the time and cost of transportation by eliminating repeated clearance of cargo in rail and ferry communication between Russia and Europe.
The accession to the Convention will enable Russian shipping companies to independently declare ferry lines between Russian and European seaports. At present, ferry lines using European ports are declared only at the discretion and the wish of European marine carriers of the COTIF member countries.
The Convention contains rules that are different from those stipulated under Russian laws, pertaining to the relations between the parties and their liability for loss or damage or harm to the cargo. Pursuant to subclause A, Clause 1, Article 21 of the Federal Law On International Treaties of the Russian Federation the decision on the accession of the Russian Federation to COTIF is to be taken in the form of a federal law.
8. Submitting to the President of the Russian Federation for the purpose of ratifying the Agreement on the Procedure of Organization and Holding of Joint Anti-Terrorist Exercises by the Member States of the Shanghai Cooperation Organization
The Agreement on the Procedure of Organization and Holding of Joint Anti-Terrorist Exercises by the Member States of the Shanghai Cooperation Organization (hereinafter the Agreement) was signed at the meeting of the heads of state of the Shanghai Cooperation Organization (hereinafter "the SCO") in Dushanbe on August 28, 2008.
The Agreement was signed pursuant to Executive Order No.494-rp of the President of the Russian Federation of August 27, 2008.
The aim of this Agreement is to provide the international legal framework for anti-terrorist exercises within the SCO to prepare special anti-terrorist units for joint action of SCO states when a terrorist attack on their territories takes place or is threatened.
The following are the goals of the Agreement:
The Agreement fully meets the provisions of the Concept of Cooperation of SCO Member States in Combating Terrorism, Separatism and Extremism approved by the Presidents of the SCO Member States in Astana on July 5, 2005.
The Agreement is subject to ratification pursuant to subclauses "a" and "d," Clause 1, Article 15 of the Federal Law On the International Treaties of the Russian Federation.
Bringing the Agreement into force meets the interests of the Russian Federation as it creates an international legal framework for the cooperation of the SCO member states in security.
9. Submitting to the President of the Russian Federation for the purpose of ratifying the Agreement on Protecting Secret Information in the Framework of the Regional Anti-terrorist Structure of the Shanghai Cooperation Organization
The Agreement on Protecting Secret Information in the Framework of the Regional Anti-terrorist Structure of the Shanghai Cooperation Organization was signed in the city of Tashkent on June 17, 2004 (hereinafter, "the Agreement") at a meeting of the Council of the Heads of State of the Shanghai Cooperation Organization (hereinafter, "the SCO"). The aim of this Agreement is to ensure protection of information in the course of cooperation of SCO member states.
The Agreement lays down the procedure of access to the information that constitutes state secrets and the procedure of storage and the use thereof. The Parties undertake to provide access to state secrets to the staff of the Executive Committee of the Regional Anti-Terrorist Structure (hereinafter RATS) of the SCO issued in accordance with the laws of the state of which the staff member is a citizen. The executive Committee of the RATS SCO has a data bank which accumulates information on international terrorist, separatist and extremist organizations, their structure, forms and methods of activity, leaders, participants and other persons related to these organizations as well as the sources and channels of financing of these organizations, including illegal trafficking in drugs, psychotropic substances and their precursors; on the state, dynamics and trends of the spread of terrorism, separatism and extremism; on the organizations and persons supporting terrorist, separatist and extremist organizations; on measures to counteract terrorism, separatism and extremism, etc.
At present the data bank contains and is replenished only with non-secret information. A necessary condition for stockpiling secret information in the databank is the coming into effect of the Agreement on the protection of secret information in the framework of the Regional Anti-Terrorist Structure of the Shanghai Cooperation Organization.
Because at the time of the signing of the Agreement referred to the above, the laws of the Russian Federation did not envisage the transfer of data constituting state secrets to international organizations, the internal procedures required for allowing the Agreement to come into force were not carried out.
On December 1, 2007 Federal Law No. 294-FZ On Introducing Amendments to Articles 4 and 18 of the Law of the Russian Federation on State Secrets that allows the transfer of information constituting state secrets to international organizations was passed and amendments were introduced to certain decrees of the Russian Government that regulate the transfer of data constituting state secrets and the regime of secrecy in the Russian Federation and the procedure of access to state secrets of persons with dual citizenship, persons without citizenship as well as foreign citizens, émigrés and re-emigres.
Pursuant to Clause 2 Article 9 of the Agreement every participant undertakes to implement legislative and other measures that may be required to criminalize knowing unsanctioned dissemination of data transferred under this Agreement constituting a state secret of another participant if such dissemination has entailed dire consequences. At present the Criminal Code of the Russian Federation does not envisage liability for such a deed. Thus the Agreement contains rules that are different from those stipulated under the laws of the Russian Federation. In addition, pursuant to Russia's obligations under the Agreement amendments will need to be introduced in the Criminal Code of the Russian Federation.
On the strength of the above, the Agreement is subject to ratification pursuant to subclause A, Clause 1, Article 15 of the Federal Law On International Treaties of the Russian Federation.
10. Submitting to the President of the Russian Federation for the purpose of ratifying the Agreement on Personnel Training for Law Enforcement, Firefighting, Emergency-Rescue Agencies and Special Services of the Member States of the Collective Security Treaty Organization
The draft federal law ratifies the Agreement on Personnel Training for Law Enforcement, Firefighting, Emergency-Rescue Agencies and Special Services of the Member States of the Collective Security Treaty Organization (hereinafter "the Agreement") signed in Moscow on September 5, 2008.
The Agreement sets down the main principles of the formation and development of an integrated system of personnel training for law enforcement, firefighting and emergency-rescue agencies and special services of the member states of the Collective Security Treaty Organization (hereinafter, the CSTO) in agreed specialties at faculties (courses, groups) at Russian higher, secondary and additional professional educational institutions, including postgraduate education institutions which train personnel for law enforcement, firefighting, emergency and rescue agencies and special services (hereinafter, "educational institutions"). Prior to the coming into force of the Agreement on mutual protection of secret information in the framework of the Collective Security Treaty Organization on June 18, 2004 the training of personnel for law enforcement, firefighting, emergency rescue agencies and special services of the CSTO member states at the Russian educational institutions will proceed under curricula and programmes with due account of the restrictions connected with security of the information that constitutes state secrets.
The Agreement also establishes that the training of personnel for law enforcement, firefighting, emergency rescue agencies and special services of the CSTO member states will proceed under contracts on a fee-paying basis or on a subsidized or free basis according to quotas established by the Russian Party. In the event of subsidized training the main cost of training is paid by the host Party and the main cost of living expenses by the sending Party.
In the event of free training, the cost of training and living is underwritten by the host Party.
The Agreement does not contain any rules that differ from Russian law.
The Agreement is subject to ratification under Subclause "d", Clause 1, Article 15 of the Federal Law On International Treaties of the Russian Federation as it affects the issues of security of the Russian Federation.
11. Introducing an amendment to the statute on the Ministry of Industry and Trade of the Russian Federation
Under Part 1, Article 4 of the Federal Law No. 165-FZ of December 8, 2003 On Special Protective, Anti-dumping and Compensation Measures during the Import of Goods the Government of the Russian Federation identifies the federal executive body responsible for conducting the relevant investigations and preparation of proposals on the use of special protective, anti-dumping and compensation measures.
Decree No. 724 of the President of the Russian Federation of May 12, 2008. Aspects of the System and Structure of Federal Executive Bodies and Decree 437 of the Government of the Russian Federation of June 5, 2008 On the Ministry of Economic Development of the Russian Federation transfers the investigative functions to the Ministry of Industry and Trade of Russia. At the same time under Clause 5.8.11 of the Statute on the Ministry of Industry and Trade of the Russian Federation approved by Decree No. 438 of the Government of the Russian Federation of June 5, 2008 On the Ministry of Industry and Trade of the Russian Federation, the Ministry of Industry and Trade performs the functions of conducting investigations preceding the use of special protective, anti-dumping and compensation measures with the exception of investigations regarding agricultural and fish products.
Thus, until now the function of investigations prior to the introduction of the said measures in the import of agricultural and fish products into the customs territory of the Russian Federation has not been assigned to any federal executive body.
At present there are a growing number of complaints filed with the Government of the Russian Federation and the Ministry of Industry and Trade of the Russian Federation by Russian producers of farm produce (oil and butter, nuts, cooking salt of all types, boiled sweets, powder milk, poultry meat and pork) seeking protection of their interests by the introduction of protective, anti-dumping and compensation measures.
In light of the above, the Ministry and Industry and Trade has prepared a draft decree of the Government of the Russian Federation On Introducing an Amendment to the Statute on the Ministry of Industry and Trade of the Russian Federation that includes in the functions of the Ministry of Industry and Trade the implementation of special protective, compensation and anti-dumping investigations with regard to agricultural and fish products.
12. The issue to the Government of the Karachayevo-Circassian Republic of Government Housing Certificates for Distribution among the Citizens who lost housing as a result of the emergency situations that occurred in the Karachayevo-Circassian Republic on June 17-18 and 28-30, 2007
As a result of the emergencies that occurred on the territory of the Karachayevo-Circassian Republic on June 17-18 and 28-30, 2007 significant damage was caused to utilities and the social facilities and more than 350 homes became unfit for living and not subject to restoration.
The total material damage from the said emergency has exceeded 1 billion roubles, according to the Government of the Karachayevo-Circassian Republic.
An examination of the results of the documentary proof submitted by the Government of the Karachayevo-Circassian Republic has determined that 480 state housing certificates be issued to the Government of the Karachayevo-Circassian Republic to be subsequently redeemed by budgetary allocations from the Reserve Fund of the Government of the Russian Federation for Emergency Management to be distributed among the citizens living in 356 homes recognized as unfit for occupancy by the Ministry of Regional Development of Russia.
This draft executive order has been prepared on the basis of validating materials, including the register of households unfit for further use agreed to with the Ministry of Regional Development of Russia, the list of citizens entitled to state housing certificates approved by executive orders of the Government of the Karachayevo-Circassian Republic.
Executive orders of the Government of the Russian Federation No. 556-r of April 24, 2008 and No.598-r of April 30, 2008 allocate to the Government of the Karachayevo-Circassian Republic 100,229,600 roubles for lump-sum material allowances to the victims and for urgent emergency reconstruction work to liquidate the consequences of the emergency situations referred to above.
Under this executive order of the Government of the Russian Federation the consequences of the above emergency situations on the territory of the Karachayevo-Circassian Republic will be fully liquidated.
Moscow, May 29, 2009
*Press releases by the Department of Press Service and Information contain the materials submitted by the executive federal bodies for discussion by the Presidium of the Government of the Russian Federation.
