20 august, 2009 14:00  

Prime Minister Vladimir Putin chaired a meeting of the Government Presidium


“The recent tragic events at the Sayano-Shushenskaya hydroelectric power station have made it perfectly obvious how much we still have to do to increase the reliability of technical structures in general, and hydro-technical facilities in particular. We must conduct a thorough inspection of all strategic and vital installations of the infrastructure and work out a procedure for their regular modernisation and monitoring over their technical condition.”

Vladimir Putin At the meeting of the Government Presidium

Transcript of the meeting's beginning:

Vladimir Putin: Good afternoon, colleagues. Let's start with immediate problems. According to the schedule of preparing the 2010 budget, the Military Industrial Commission was to submit its proposals to the Ministry of Finance.

Mr Ivanov, can you report on the work on the state defence order? What have you done so far?

Sergei Ivanov: In accordance with the schedule approved by you, on August 20 the Military Industrial Commission submitted the draft state defence orders for 2010, 2011 and 2012 to the Ministry of Finance.

As I reported to you in Sochi, when formulating the state defence order, in particular for 2010, we proceeded from the current economic situation and focused on unconditional implementation of the six priorities regarding the deliveries of weapons and military hardware.

The first priority is to ensure sufficient supplies to the Strategic Missile Force and nuclear security.

The second priority covers space-based equipment and missile space defence.

The third priority is to ensure that the Defence Ministry fulfils all long-term contracts signed in 2008-2009. A relevant example is the long-term contract, signed in your presence at the MAKS Airshow the day before yesterday, for the delivery of combat aircraft to the Defence Ministry until 2015.

The fourth priority is to guarantee technical readiness of the general-purpose forces. Weapons will be supplied to the general-purpose forces in large batches sufficient for a specific group, for example, a battalion.

The fifth priority is to strengthen the military infrastructure and permanent-readiness forces in strategic directions, above all in the south, and to reinforce the defence capability of the Black Sea Fleet.

The sixth priority is to fulfil the instructions of the President, the Prime Minister, and the Military Industrial Commission regarding the acquisition of aircraft equipment as well as communications and intelligence equipment for permanent-readiness units.

Proceeding from these six priorities, we have determined the total sum of allocations necessary for the Armed Forces, and it amounts to 470 billion roubles. The Military Industrial Commission has approved this proposal. That's all regarding the acquisition of weapons and military equipment.

In addition, 64.4 billion roubles will be allocated to all other security agencies not incorporated in the Defence Ministry for the purchase and repair of weapons, and for R&D. Compared to the 2009 state defence order, allocations to other security and law-enforcement agencies have been increased by 6.7 billion roubles.

As for logistics, 64.9 billion roubles will be provided for food supplies, 15.6 billion roubles for clothing and personal equipment, and 65 billion roubles for the purchase of fuel and lubricants, including special fuels. That is 22% more than was allocated for these purposes in 2009. In other words, the military organisation will have requisite amounts of foods, material support and fuel and lubricants.
Another key priority, which, as I see it, is characteristic of the 2010 state defence order, is a dramatic increase in allocations for the provision of housing to servicemen. In order to provide permanent housing to the Defence Ministry servicemen in 2010, 124 billion roubles have been allocated for the military organisation for this purpose, including 95.2 billion roubles for the provision of permanent housing and 28.8 billion for the provision of state-owned housing. That if 50 billion roubles more than in the 2009 defence order.

To sum up, I would like to say that the main guidelines of the state defence order have been approved. Of course, it will still be discussed by the Budget Commission, and should be subsequently approved by a government resolution by the end of this year.

By the way, I believe that, given such streamlined work, all security structures will be able to contract the bulk of allocations already in the 1st quarter of 2010 and transfer them to the producers, thereby making advance payments to the industries. In my view, this will allow us to maintain the key parameters of the current state armaments programme and also ensure support to the sectors that produce not only weapons and military equipment, but also high-tech civilian goods. And third, this will allow us to attain a social goal, because many defence enterprises are also the largest employers in their cities, which implies support to such cities.

So, the overall sum of the draft 2010 state defence order for all security structures adds up to 1.109 trillion roubles, which is more than we allocated in 2009.

Vladimir Putin: Very good, thank you. Mr Ivanov mentioned the MAKS 2009 Airshow, where we held a conference on the development of the aircraft manufacturing sector. Yesterday I signed a government resolution on amending the rules for compensating part of the Russian airlines' spending on lease payments and interest on loans taken out in 2002-2005.

Mr Levitin, could you comment on this decision, please?

Igor Levitin: This policy will in fact increase by 50% the compensation of airlines' leasing payments and will therefore encourage them to buy Russian-made aircraft. We have been providing compensations for 22 jets since 2002, as airlines had asked for support during the recession. This is part of the government anti-crisis programme, and we have incidentally discussed it at the MAKS-2009 Airshow. It will certainly be a good solution for air carriers in the current economic downturn.

Vladimir Putin: Good. Will they use this chance?

Igor Levitin: We will be meeting with them to discuss 2010 orders.

Vladimir Putin: Good. Mr Kozak, I would like to hear now about the progress in the preparations for the autumn and winter season, please.

Dmitry Kozak: Mr Putin, we have recently looked at some mid-year results of preparing the power generation facilities and other utilities services for the heating season.

I can tell you that on the whole, the regions are demonstrating the same level of preparedness as this time last year. As you know, the utilities worked smoothly through last year's heating season. As of now, facilities across the country are 60%-65% prepared, and their pace is as good as last year. Admittedly, some of the regions, especially in the Far Eastern Federal District, are seriously behind others.

We have made individual decisions on specific constituent regions and issued relevant instructions.

Industrial safety regulator Rostekhnadzor is compiling, upon a government instruction, a register of power and heating utilities that are facing problems due to the economic downturn.

Regional governors have been instructed to draw up, in cooperation with these ailing companies, anti-crisis plans aimed at compensating for the lag. By September 20, Rostekhnadzor has to complete the register and submit it to the Government along with the plans.

The Ministry of Regional Development together with the Ministry of Energy have set up an interdepartmental group to monitor the preparations' progress. This group is to prepare, also by September 20, an intermediate assessment of the regional executive bodies' performance in preparing for the winter. Although, on the whole, the work is going on in accordance with the government decisions made on April 13, 2009.

Normally, this assessment would have been given on November 25, but considering the current economic situation, we asked them to give an intermediate assessment so that we have time to invite governors of problem regions to report on their performance at meetings with the Government before the end of September.

Let me repeat that on the whole, despite the difficult economic situation, there are no serious concerns about the preparations for the winter. Rostekhnadzor and regional Governments are primarily focused on the technical condition of power-generating and heating facilities in single-industry towns. It is important because the town halls' possibilities to finance housing and utilities often also depend on the effective performance of the local economic mainstay. Very often power-generating and heating facilities in these towns are also owned by the principal employer. That is why they require special attention.

Therefore, the Regional Development and Energy Ministries have been instructed to prepare, by September 1, draft normative acts which would authorise putting such heating facilities into temporary management of regional or municipal authorities, to keep the utilities going if they show signs of economic ailing.

I think this measure is very advisable for the coming heating season, considering the complex economic situation. The relevant legal documents will soon be drafted and submitted.

Vladimir Putin: This has to be done in time so that we have the legislation to promptly respond to such occurrences.

Dmitry Kozak: I think we will pass such a regulatory document by the beginning of the heating season. Moreover, in line with the government decision adopted yesterday, Minister of Regional Development Viktor Basargin has held a teleconference with governors of all Russian regions. The Minister heard reports from the regions that have fallen behind schedule in preparing municipal housing utilities and energy facilities for the winter. I expect Mr Basargin will be able to give us some details about the results of the meeting.

Vladimir Putin: Go ahead, please.

Viktor Basargin: Mr Putin, I held a teleconference at the Emergency Ministry centre yesterday. All governors had been invited. Ten governors asked to report back, four of them were from the Far Eastern Federal District. The winter preparation works have been proceeding there slower so far, as Mr Kozak has just mentioned, and I would like to point out that all territories have emergency units and commissions involved in the work. All activities planned in the regions to prepare for the autumn and winter season are being implemented in full.

We had some apprehensions that a possible drop in financing the works could occur because of the financial crisis, but neither the governors' reports nor monitoring results testified to that.

Still, certain issues mentioned earlier raise concerns. First, outstanding debts to municipal housing and utilities enterprises remain high both on the part of businesses and individuals. As of today, the governors of all regions, especially those that have high debts, have been instructed to set up commissions to restructure debts and report back on the redemption of debts on a weekly basis.

Secondly, there are problems related to fuel supplies to certain regions in the Far Eastern Federal District. There have been complaints about certain companies raising fuel-oil prices. We will handle the issue together with the Energy Ministry. So far, we have recommended that mediator services should be eliminated completely. There have even been instances of certain companies getting monopoly rights for supplying fuel to certain territories. We are now working on this issue.

Within the next two weeks, we are going to hold meetings in all federal districts to check on the preparation work, starting with Kamchatka and the Far East. We will take practical measures to ensure proper preparation for the autumn and winter season.

Overall, the situation is within norm. None of the regions have made any cuts or come across serious problems in implementing the plans.

I would like to add that all governors emphasised the effectiveness of the programmes being carried out by the federal centre. These are programmes related to capital repairs of housing which we implement with the State Fund for Restructuring Housing and Public Utilities, and those related to modernising the infrastructure.

In this regard, I would like to note that we are completing the development of a complex programme on restructuring housing and utilities, in line with the task we were given at a presidium meeting in April. Development of the programme to restructure housing and utilities in municipal districts will be financed by a 200-million rouble loan from the International Bank for Reconstruction and Development, the issue to be considered today. This programme includes a new scheme for financing works to restructure housing utilities and attracting investment, particularly from private sources, to the housing and utilities sector.

The programme enjoys active support from governors. Ten municipal entities have already been selected and tenders held as regards loan placements, with package plans to be developed in the nearest future.

Vladimir Putin: Good.

Viktor Zubkov: Mr Putin, I have a proposal to make. When you discuss preparations for winter with the heads of the federal districts once again, please note that many regions have huge debts to Gazprom. These debts are increasing every month. Today, they exceed 63 billion roubles. Moreover, many regional leaders are ignorant of this situation, and do not even know that their regions, that is regional companies, do not pay for gas.

Gazprom is not planning to punish anyone, but if these failures to pay keep mounting, they may reach a huge amount before the end of the year. Therefore, I would like to ask you to draw the regions' attention to the need to pay for gas, in the course of winter preparations, especially in August and September.

Viktor Basargin: We have emphasised this problem because we know that housing and utilities companies, plants and other organisations owe money to the suppliers. Unfortunately, about 30 billion roubles are owed by state-funded organisations.

Vladimir Putin: We have spoken about this many times. State-funded organisations are properly financed. There is no need to create any additional artificial mechanisms. You must permanently keep an eye on the winter preparations. They should be monitored all the time.

Nobody should speak "on the whole" or "in general". We must know the specific situation in every region. We must compel the heads of the regions to control the situation. They should know what is taking place in their regions and cities. I would like you to conduct the meetings in the regions without delay.

As for the regions, I have asked deputy prime ministers to work in the federal districts with a view to preparing for the 2010 budget. We have a schedule of work for these districts. Yesterday, Alexander Zhukov visited the Central Federal District. How did it go there?

Alexander Zhukov: Mr Putin, yesterday I held a meeting with the heads of the regions of the Central Federal District in Smolensk. We discussed budget formation for 2010-2011-2012, and in more detail, inter-budget relations.

By and large, the majority of the regions in the Central Federal District agree with the suggested approaches, particularly, on inter-budget relations, and share the priorities which we have set for ourselves at federal level, and advised them to follow.

Most important, we must abide by all of our commitments in the social sphere without fail. We have programmed this number one priority into the draft federal budget. All regions will also make it their top priority in developing their own budgets.

The second priority has to do with the economic development or overcoming the crisis. Obviously, regional resources are limited. However, their incomes have not fallen as much as ours. The revenues of the federal budget have decreased by 30% in the first seven months of this year, whereas in the regions the relevant figure is half of that - around 15%.

Nevertheless, it is only natural that in such conditions they will also opt only for the most effective and essential projects. They will postpone what they can, and reduce ineffective spending. Needless to say, special attention should be paid to the budget sphere, which must be streamlined with a view to making spending prudent and efficient.

We have discussed two subjects separately, and I have asked them to pay attention to that. One subject is linked with the labour market and with the need to create jobs. Incidentally, according to the data we have received for the past week, the number of registered unemployed keeps going down. In the past week, their number has decreased by 7,500 people. This trend is observed in 69 regions.

The second major issue is wage arrears. These debts went down by 10% in July, and are about 6.5 billion roubles. I asked regional leaders to pay special attention to this with a view to resolving the problem.

Overall, the heads of the regions are supporting the approaches we have suggested, in particular, in inter-budget relations.

Vladimir Putin: Well done, thank you. We have many subjects for discussion today on our extensive agenda. I would like to speak about several issues in greater detail. I'm referring to the Water Strategy Project, and the plan for its implementation, as well as the new technical regulations on the safety of machines and equipment.  

The recent tragic events at the Sayano-Shushenskaya Hydroelectric Power Plant have made it perfectly obvious how much we still have to do to increase the reliability of technical structures in general, and hydro-technical facilities in particular. We must conduct a thorough inspection of all strategic and vital installations of the infrastructure and work out a procedure for their regular modernisation and monitoring over their technical condition. By and large, we must fundamentally improve technological discipline in industry and other branches of the economy.

Statistics on accidents on our roads sound like reports from a battlefield. Performance at sophisticated technological facilities is equally bad. Technological discipline is very low.

I have already mentioned that we are going to set up a special government commission to coordinate relief efforts at Sayano-Shushenskaya Hydroelectric Power Plant and to monitor its recovery. We must endorse a relevant decision today.

Tomorrow, we are planning to discuss with regional and local authorities on the site assistance to the victims of the accident, reconstruction of the electric power plant, and stable electricity supplies to Siberia.

As for the Water Strategy Project, I would like to remind you that the instruction on its implementation was given at a meeting in Rostov last year. At that time, we discussed comprehensive development and effective use of our water resources.

I would like to note that certain positive changes are in the offing: The new Water Code has come into force and now regulates government control over the use and protection of water facilities; a programme for developing the water management complex next year has been launched.

In recent years, we have made a number of achievements. Water losses during transportation have decreased by 6.3%, while sewage dumping has been reduced by 9%. The introduction of the closed cycle technology has increased the reuse of water by 6.5%. The quality of water, including that from drinking water sources, has improved. The water-holding capacity of our GDP has been reduced, although we are still behind many countries in this respect.

Let me map out the strategy's priorities. First of all, we must drastically upgrade the environmental condition of our water bodies, which is of fundamental importance for improving the living standards and health of our citizens.

We must pursue the rational use of water resources, and introduce water-saving technologies in the energy sector, agriculture, transport, industrial production, and housing and utilities.   

Let me repeat that we must also concentrate on securing reliable and safe operation of hydraulic facilities, and protecting the population and economic installations from floods and other water-related negative phenomena.

Implementation of major infrastructure projects is bound to require huge investment. At the same time, apart from budgetary funds, we must create the conditions for attracting private investment into our water management complex. The expenditures required for implementing the strategy, which we are going to review today, will add up to about 662 billion roubles in the period up to 2020. About 500 billion roubles will come from the federal budget; the regions will not contribute much, while extra-budget funds will amount to a mere 66.9 billion roubles. In general, this sphere may be quite attractive for private investment as well.

Now I would like to say a few words about the second item on our agenda. We will discuss draft technical regulations on the safety of machines and equipment ranging from industrial tools to household appliances.

As for regulations, this is not an abstract issue. They will set new requirements to the quality of production and produce, and the effectiveness and environmental safety of our economy and its key sectors. In a word, they will deal with the major instruments of upgrading our competitiveness.

I would like to emphasise that the provisions of the draft regulations meet the latest global requirements, including those on energy effectiveness.

Their enforcement will make it possible to substantially simplify the procedures linked with certification of new equipment. Hence, we will receive additional opportunities for the technical re-equipment of our national industry.

Now let's discuss issues on our agenda.