Alexander Zhukov's speech:
Today, we are holding a plenary discussion entitled "This Decade's Social Challenges." We will discuss some of our country's most pressing problems and I would like to thank the conference organisers for showing initiative and providing a venue for this discussion.
The fundamental social challenges in Russia for the foreseeable future are specified in the Concept of Long-Term Socio-Economic Development of the Russian Federation to 2020 and in the Guidelines for the Activities of the Government of the Russian Federation to 2012.
Today, from my perspective, a discussion of these problems is highly topical, since it is generally agreed that the acute phase of crisis is coming to an end and it is possible to make a thorough and balanced assessment of the pressing challenges to the country's social development, while taking the consequences of the crisis into account.
I note that the challenges facing the country reflect both global trends and internal obstacles to development. I will focus only on the most important ones.
Primarily, I will discuss the increased role of human capital as a major factor in economic development.
The competitiveness of any modern innovative economy is, to a great extent, defined by quality of its professionals. We cannot rely on cheap labour to support our competitive position in the global economy.
Rising to this challenge requires us to improve the country's demographic situation, modernise public health services and education, and develop pensions and social benefits. It also necessitates cultural development and the formation of effective labour markets and housing.
Now let's talk a little bit more in detail about each of the aforementioned areas.
The government's demographic policy priorities for the coming period will be:
- Decreasing the population's death rate, first and foremost the high death rate of people of working age due to external reasons, decreasing the death rate among mothers and infants
- Protecting and strengthening public health (primarily by increasing the role of preventative healthcare), improving the quality of life for the disabled
- Increasing the birth rate
- Strengthening the institution of the family, reviving and maintaining the spiritual and moral traditions of the family.
From 2005 to 2009 the birth rate increased by almost 21% and the death rate was reduced by more than 15%, including the infant death rate which fell 26.4%. Behind these figures are the lives of hundreds of thousands of citizens throughout our country.
For the first time in many years, we were able to stabilise the population. Today, at around 142 million, it corresponds to its level at the beginning of last year.
From 2006-2009, life expectancy for men and women increased by almost four years to 69 (63 for men and 75 for women). This is a dramatic illustration of how efficient state measures on social policy have been. At the same time, in comparison with developed countries, Russia's demographic figures remain low. Indeed, we still have a great deal to do.
Remember that the Concept of Demographic Policy of the Russian Federation to 2025 sets out our aims: for the population to stabilise at 142 - 143 million by 2015, to create conditions conducive to the growth of the population to 145 million by 2025, to improve the quality of life and increase life expectancy to 70 by 2015, and to 75 by 2025.
Our aging population places an increased burden on the pensions and public health systems and presents a serious problem. Where in 2005 there were 580 unemployable people for every 1000 of able-bodies citizens, this figure is forecasted as rising to 837 by 2020.
In 2020, the number of women of reproductive age in comparison with 2009 will drop by 4.1 million or 10.7 %. And this reduction is primarily among women aged 20-29, their most reproductively active age, their number which will fall by 4.6 million or 38%.
The most significant fall will occur in the period from 2012 to 2021.
In order to maintain the birth rate at 2009 levels (1.76 million) in 2015, the cumulative birth rate should be 1.66, in 2020 it should be 1.95 and from 2025 onwards it should be 2.21.
If we are to talk about halting the natural decline in population, then resolving this problem will require an even higher birth-rate. This can not be achieved through stimulating the birth rate alone. We have to take more active measures to decrease the mortality rate and here I would like to draw particular attention to the problem of the prevalence throughout the population of habits that are detrimental to health. This problem can rightfully be considered a social challenge.
In our country, 50% of Russians smoke. The growth rate in the numbers of smokers in Russia is one of the highest in the world and it is 1.5%-2% annually, including women and teenagers. 33.4% of teenagers (aged between 13 and 15) smoke tobacco.
A growing number of young people and women of reproductive age are consuming beer and low-alcohol beverages. According to the Russian Ministry of Healthcare and Social Development, about 33% of young men and 20% of girls consume alcoholic drinks (including beer) daily or every other day.
Since last year, as part of the national project "Health," we have begun implementing measures to promote and support a healthy way of life among the population. At the same time, the successful resolution of this problem demands consolidated efforts from our entire society.
The next condition needed for the development of human capital is the modernisation of the healthcare system.
The main objective of state policy on healthcare during the forthcoming period is creating a system that guarantees access to healthcare, as well as increasing the efficiency of medical services.
We will achieve this by expanding the use of advanced developments in preventative medicine, diagnostics and treatment, as well as by improving the effectiveness of the education and re-training of medical personnel.
The effective development of human capital places new requirements on the educational system.
The strategic goal of state policy in education is to increase access to high-quality education.
Developing a system of general education involves personalising it, focussing on practical aptitudes and fundamental skills, and expanding further education opportunities.
One key condition for the development of a system of higher vocational training is attracting students and teachers to fundamental and applied research. This will not only enable Russian scientific schools to retain their international reputation, but also to develop a new generation of researchers focused on the requirements of an innovative knowledge economy.
Culture plays a leading role in forming human capital. The development of a successful, socially oriented individual is only possible in a culture that enables them to understand the purposes and moral reference points for social development.
This demands the transition to a qualitatively new approach to how libraries, museums, exhibitions and archives operate, to concerts, the theatre and cinema, as well as to traditional ethnic culture, and the preservation and popularisation of cultural heritage sites. The wide-ranging introduction of innovation and new technological solutions makes culture, with all the benefits it brings, more available, and so results in a richer cultural environment better suited to meeting the growing needs both of the individual and of their society as a whole.
Living conditions have a direct influence on development of human capital. This is relevant to the national priority measures on state housing policy.
Co-ordinated action by the state and development institutions last year helped mitigate the negative impact of the financial crisis on the housing sector and also created conditions conducive to the continued growth of the housing market in the medium-term.
One grave challenge remains a decrease in manpower due to the decline in population of working age (over 10% in 2007-2020) a lack of qualified labour, and the imbalance between labour supply and demand in professional and territorial cross-sections of the population. This is a serious restriction on economic growth.
A strategic goal of state policy on labour market development in the long-term is creating the conditions necessary to provide the economy with highly professional personnel and increase their efficiency. Alongside the modernisation of vocational training and personnel re-training systems, a major precondition for attaining these goals is increasing the flexibility of the labour market, its structural balance and the appearance of conditions enabling professional and territorial mobility among the population. Under these conditions, the process of re-distributing workers from inefficient companies to efficient ones and increasing labour productivity remains a major factor in easing the labour shortage.
Currently, the value-added production per employee in Russia is 83.1% less than in the U.S., 80.8% less than in the G7 countries and 76.8% less than in Japan. In terms of manufacturing per hour, the gap is even greater: 83.6% less than the U.S. and 81.5% less than in the G7 countries.
The transition to an innovative economy (re-structuring and diversifying the economy) will lead to changes into existing employment structures and will be accompanied by a decline in the number of inefficient jobs, the re-distribution of workers to other economic sectors, an expansion of the service sector and the growth of new areas of employment. In these conditions, the labour market will help stimulate the creation of new and effective jobs, including flexible forms of employment, increasing their turnover.
Regarding employment problems, I would like to note that the crisis has aggravated the social problems experienced in one-company towns, of which there are more than 300 in Russia, with a total population of more than 20 million. I can say that by February 1, the government will present comprehensive plans for modernisation of the first 25 of these one-company towns.
Finally, another serious social challenge remains the considerable differentiation of the population in terms of income level and its high poverty level. The ratio of the richest 10 percent to the poorest 10 percent is 1580% and the number of people whose income is below the poverty line is 21.1 million or 15% of the total population.
In order to solve this problem, which is directly connected with increasing consumer demand among the population, the Government is making rolling increases in the minimum wage, thereby increasing the level of material well-being, primarily for citizens with fixed incomes (public-sector employees and pensioners) and strengthening social support for the low-income categories of the population.
Since January 1, 2009, the minimum wage was set at 4,330 roubles per month, which corresponds to the living minimum wage of 2007. In conditions where consequences of the crisis have not definitively been overcome and the financial capabilities of both the state system and business remain limited, the amount by which the minimum wage will be increased will in the short term be subject to a careful analysis of possible socio-economic consequences, and trade unions and employers will be consulted.
The Government is implementing unprecedented measures to increase the material well-being of senior citizens.
To pensions, where a planned increase will take place so that by 2010, the average old-age retirement pension will rise to 1.47% of the the pensioner's living minimum wage. There will be a concurrent increase to the average size of social pensions, bringing them up to the level of the living minimum wage.
The further development of the pension system on the basis of its insurance principles will be carried out with a view to increasing pensions for all categories of pensioners, maintaining its financial equilibrium to ensure its long-term stability and the achievement of the following figures:
to maintain, from 2010, the minimum level of material support for pensioners at no less than the pensioner's living minimum wage and to increase the average size of old-age retirement pensions by 2016-2020 to no less than 2.5 to 3 living minimum wages;
to create conditions for the increase of individual earnings replacement rate for earnings lost, on which insurance payments and old-age retirement pensions are calculated, to no less than 40%.
Pensions policy should be implemented alongside other measures aimed at resolving the problems of the elderly, in particular, the development of medical services.
I'll now talk a little about Russia's international social obligations. Today, as part of the preparations for the ratification of the United Nations Convention on the Rights of Persons with Disabilities, the government is finalising programs for the systematic resolution of the most acute problems of these citizens (and there are more than 13 million of them).
Of these preparations, firstly, I would like to mention the problem of guaranteeing accessibility to the physical environment, transport, and information. In conjunction with national public organisations for the disabled, the government has developed the program concept "Accessible Environment" for 2011-2015, which, according to the President's address to the Federal Assembly, will be adopted this year.
I emphasise that creating an accessible environment for vital daily activities is a complex, large-scale, nationwide problem, the resolution of which requires not only considerable material, financial and intellectual resources, but also in many respects, changes to the habitual public perception of this problem.
Implementing the priority national projects to improve the quality of life of the Russian public, including education, public health and housing will enable us to approach the standards set out in the European social charter.
The decade's social challenges (and I have only addressed the main ones) together predetermine the need for the further improvement of the state's socio-economic policy.
I am confident that today's discussion will be interesting, fruitful and useful both for government representatives and the scientific community.