During his visit to Energomash's final assembly shop, Mr Putin was shown a number of rocket engines, including the RD-191, RD-171 and RD-180. Energomash General Director Dmitry Pakhomov told the Prime Minister that the RD-191 engine is not made with any imported materials or components, and is environmentally friendly and consistent with other engines.

Mr Putin was also shown the RD-171 engine, which was developed for the Zenith missile carrier. Mr Pakhomov pointed out that the 800-tonne engine was the company's most powerful. "Nobody else makes them," he said.

Mr Pakhomov also told Mr Putin about the RD-180 engine, which is installed on the American missile carrier Atlas. He noted with pride that this engine is now used in about half of all commercial launches in the United States.

"Thank you for supporting exports. We have managed to double the value of our exports," said Mr Pakhomov to the Prime Minister.

During his visit to the company, Mr Putin asked Mr Pakhomov whether his company has already received the government-allocated money, to which Mr Pakhomov responded that they had not yet received it.

Mr Putin asked Head of Roskosmos (the Federal Space Agency) Anatoly Perminov, who was standing nearby, for an explanation. Mr Perminov said that the delay was caused by a number of bureaucratic procedures.

"Please send the money before the end of this week," demanded the Prime Minister. The Prime Minister later spoke with the company's employees.

Transcript of Prime Minister Putin's conversation with Energomash employees:

Question: Mr Putin, our company owned two blocks of flats used as hostels for our employees in Khimki. The title of one of them was transferred to the municipality by decision of Rosimushchestvo (the Federal Property Agency). After this the rent went up from 380 roubles to 4,200 roubles per month. This is almost too much for us. Could you please consider this issue?

Vladimir Putin: The transfer of companies' social facilities to the municipalities is a complicated process, because municipal agencies often do not want them.

However, this transfer improves companies' financial and economic position. Companies have to spend money on these facilities, and so during the crisis we are trying to help them get rid of social facilities and shift this burden to the municipalities. But they don't have enough money, either.

Therefore, the choice is always difficult - either your company has to continue carrying this burden, in which case you will have to work more, or such facilities should be taken away from you.

Needless to say, the rent should not have gone up so much, and I will find out why it has done so. If this is justified economically, that is one thing...

Remark: Four thousand five hundred is too much.

Vladimir Putin: And if this was done to oust you from the hostel flat, then this is a quite different matter.

Remark: There have been no additional services to justify such a sharp increase...

Vladimir Putin: I will talk to Gromov (Boris Gromov is the Governor of the Moscow Region).

Remark: If possible, could the second block of flats be left with our company, please.

Vladimir Putin: This is possible, but it is worse for you, and for your company.

Remark: We'll manage.

Vladimir Putin: You will manage, but you are spending money on it. This will affect your company's finances.

Remark: We are interested in the purchase of new equipment. We have many workers, and we are bringing in many from nearby cities. They have already been trained here, and they are bringing their families. They want to settle down here. If we give up this hostels... We should retain our personnel, shouldn't we? We must compete with other companies.

Vladimir Putin: If there is no production, you won't need personnel. And you won't need it if you are unable to compete, or if your company breaks down. You won't need any new workers in that case.

Remark: It's the question of the chicken or the egg. What is more important? What to choose?

Vladimir Putin: Production should come first. Your products should be competitive and in demand in foreign markets and in our defence industry. This is what should come first.

Remark: People are required for this.

Vladimir Putin: Sure, but production must come first. Economy is most important. Your prosperity depends on it. Prosperity doesn't emerge from nowhere. This is a fact of life, and there is nothing we can do about it. If we continue to increase the burden all the time, then you are withdrawing money from your association's current account.
But I will look into it. No doubt, municipalities should pursue adequate policy. I wll talk to Governor Gromov by all means.

Question: Mr Putin, I have a question about pensioners. The pension has been raised several times this year. It will be increased substantially next year when work in the Soviet period is taken into account. Will we have to run from government office to government office to get the required papers? And won't prices shoot up because of the increase in pensions?

V.V.Putin: That wouldn't be good...

Remark: You know how it is. You hardly sign a decree when officials increase prices for housing, utilities and electricity.

Vladimir Putin: Yes, this is true. This problem exists.

First, about the different papers. At a recent meeting with the heads of the regional pension funds, we emphasised that valorisation, that is, adjusting the rights of citizens who were entitled to retirement benefits in the Soviet times, should not entail excessive bureaucratic procedures. I hope this instruction will be carried out properly.

As for prices, regrettably, the market is very sensitive and instantly reacts to any increases in social allowances or pensions. We will try to restrain the government-owned producers, all the more so since we have definite procedures for increasing prices. We will try to restrain them.

Price increases in the market as a whole is a separate subject. It requires special attention from the anti-monopoly agencies. We will monitor them. I believe there will be no serious price hikes.

This is all the more so since we have been able to curb inflation recently. There has even been a small decrease in prices on a number of products. It is symbolic, of course, but there has been a decrease in prices on basic foods.

Remark: Yes, they have gone down a little...

Vladimir Putin: Yes, they have.

Remark: This is a seasonal thing...

Vladimir Putin: Seasonal fluctuations start in September and continue up to now. But the decrease is due not only to seasonal fluctuations. Regrettably, there is another factor at work here, and we must be frank about it - real incomes have decreased a little this year. They have decreased by 0.4%.

It goes without saying that producers of consumer goods and retail chains understand this and cut prices. As for the next year, we wanted primarily to support people with the lowest incomes, that is pensioners. They are spending money mostly on domestic products - foods and consumer goods. I don't think there will be any hikes here, especially today.

Remark: Thank you very much.

Vladimir Putin: At any rate, we will try to monitor this.