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Prime Minister Vladimir Putin holds a meeting of the Government of the Russian Federation

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Vladimir Putin's opening remarks:

Good afternoon,

Today we will review the amendments to the 2010 federal budget. As you know, our primary goal is to cut the budget deficit and finance a number of additional projects.

According to the Ministry of Finance, 500 billion roubles will be used for cutting the budget deficit from 2.9 trillion to 2.4 trillion roubles.

As for the new expenditures, they are mainly concerned with fulfilling the social obligations, such as paying off pensions, providing housing for military personnel and veterans of World War II.

I would like to draw your attention to some important considerations in the social sphere such as the income level of military pensioners. We need to think about improving the system, especially considering the upcoming reform in the military pay system. It is evident that civil pension increases created a misbalance in the pension provision for military pensioners.

I believe it's necessary to immediately increase the bonus payments for military pensioners. Currently the payments are 240 roubles. These need to be increased to at least 1000 roubles.

We have assigned 7.9 billion roubles for this purpose.

It is also necessary to make certain amendments to the budget - to the Budget Act and the act, regulating the pension provision of the military pensioners.

One hundred fifty billion roubles will be allocated to make up the deficit in the Pension Fund budget.

Due to the new pension provision system, financing additional federal and regional pension budgets will take 13.1 billion roubles; providing housing for war veterans - those who applied after 2005 - 82.3 billion roubles; providing housing for servicemen transferred to the reserves - 42.9 billion roubles.

As for the provision of housing to retired servicemen registered with local governments, we have discussed the problem of that neglected group of people. They retired from the Armed Forces in the 1990s and were not provided with housing. Instead, they were registered with municipal governments, but the queue is not becoming shorter for them. This is a very important issue; we must guarantee social justice and we will solve this problem. We will allocate 10 billion roubles for this purpose.

As we have agreed, an additional 10 billion roubles will be provided for the car scrappage programme this year. The agencies involved - the Ministry of Trade and Industry and the Ministry of Finance - are to coordinate their activities under that programme.

Allocations for transport safety will amount to 7.8 billion roubles.

Subsidies for balancing budgets will reach 5 billion roubles.

In addition, we have found a way to accelerate the implementation of several investment projects, including the reconstruction of the Bolshoi Theatre in Moscow, the Mariinsky Theatre in St Petersburg, the Moscow Conservatory and Ocean children's centre in the Primorye Territory.

Sixteen billion roubles have been allocated for urban road building projects, primarily in cities where roads are in disrepair, to put it mildly, but where regional and municipal authorities do not have adequate resources to address this problem quickly and effectively.

Thanks to the economic recovery, we now have an opportunity to increase funding for priority items and to cut the budget deficit more quickly. It should be said, however, that this year the ministries and departments must work to the best of their ability to save money and to spend efficiently. At the same time, they must promptly respond to acute problems, including both new problems and ongoing problems, just as they worked to resolve the problem of Pikalyovo.

When the Pikalyovo problem arose, we responded quickly, and we continue to monitor the situation, to see it through to the end. A government resolution has been adopted to allocate 350 million roubles in additional subsidies to ensure that raw materials are delivered [to the plant]. I hope this will further stabilise the work of the complex.

I want to remind you that your response to such problems must be quick and your work to resolve them consistent. We must ensure the implementation of all our decisions and see to it that they are implemented without fail.

Also, I'd like to draw your attention to cooperation with our neighbours in the CIS and the European Union.

First, this fall we plan to hold a cultural and research forum of the CIS countries in Moscow. Such meetings have become a tradition; they were held before and, I hope, will continue to be held in future. They are very popular and usually very successful. Most importantly, they lead to the implementation of new initiatives and joint cultural projects, and help bring the CIS countries and their people closer together. Today we must take a decision on forming the future forum's organising committee.

Second, a block of agreements between Russia and the EU has been prepared for ratification by the State Duma. We have agreed with our colleagues on several joint projects aimed at boosting border cooperation with EU countries such as Finland, Estonia, Latvia, Lithuania and Poland.

This is a good example of mutually advantageous cooperation on an equal footing, which will benefit people on both sides of the border, facilitate relations between our citizens, help establish new business ties, create new jobs, and generally serve as another major step toward developing strategic relations with the European Union.

Both sides will allocate funding for this programme. Russia will provide 105 million euros and the EU a slightly larger sum.

Another issue on our agenda today concerns the comprehensive development of our regions. We plan to approve comprehensive development strategies for all federal districts and also lists of priority projects in industry and the social sphere, which must be implemented within two to three years.

Of course, this work will not succeed without the close cooperation of federal and regional authorities. We propose delegating coordination of this process to the Ministry of Regional Development.

Let's get to work.