Working Day

19 october, 2009 19:13

Prime Minister Vladimir Putin chaired a meeting of the Government Presidium

Prime Minister Vladimir Putin chaired a meeting of the Government Presidium
"The Russian-Finnish Forest Summit is due in St Petersburg on Sunday. This is why I deem it necessary for the Russian Government to explicitly define its position on the use of forest resources, the development of the timber processing industry, and the basic principles of cooperation with our foreign partners. Obviously, we cannot be content with just supplying raw timber and with the current state of the industry."
Vladimir Putin
At a meeting of the Government Presidium

Transcript of the beginning of the meeting: 

Vladimir Putin: Good afternoon, colleagues. Is Minister Trutnev here? Mr Trutnev, you visited Sochi to participate in a meeting of the Presidential Council Presidium on the Preparations for the Sochi Olympics working group. Could you please tell us about the debate on environmental issues?

Yury Trutnev: Mr Prime Minister, colleagues, we considered several issues, primarily the preparations to compensate for inconveniences caused by the construction of Olympic facilities. There are plans to expand two specially protected natural sites, specifically Sochi National Park and Caucasus Biosphere Nature Reserve.

Plans involving Sochi National Park will be submitted to assess their ecological impact, and the area of the park will be expanded by some 20,000 hectares. The plans concerning the Caucasus Nature Reserve are nearly ready for submission to the Government.

We also reviewed our interactions with public organisations. No environmental assessments were carried out this year without the participation of environmental advocacy groups.

In addition, we touched on the issue of to what extent waste disposal projects in the area the Olympics will be held and water supply and sewage systems at Olympic facilities are complying to environmental standards.

We noted that there has been significant progress on all these sites, including the use of the best technologies available and the implementation of green standards. All in all, the Presidium meeting was held in a positive atmosphere.

Vladimir Putin: How are our leopards?

Yury Trutnev: Well, they are fine, but more money is needed to feed them.

Vladimir Putin: So they have eaten all they had? They have run out of their food?

Yury Trutnev: Well, they eat a lot.

Vladimir Putin: Good, they have a good appetite. How's the work on breeding more species?

Yury Trutnev: It's in progress. You'll be informed on it later.

Vladimir Putin: All right. Mr Shuvalov, I signed an executive order on the Protocol for the status of the Customs Statistics Centre of the Commission of the Customs Union we are creating with our Kazakh and Belarusian partners. What effect will it have? And how's progress on the Customs Union in general?

Igor Shuvalov: Mr Prime Minister, colleagues. On October 21, the ninth meeting of the Customs Union Commission will be held, where we'll consider all draft documents to be submitted to the heads of state for signing on November 27 in Minsk.

On November 27, Minsk will host a meeting of the EurAsEC Interstate Council, the governing body of the Customs Union. Adopting these agreements will be the last step in the establishment of a legal framework for the Customs Union.

We have worked out almost every issue. There are only a couple of issues left, and these were discussed at the previous Government meeting. You issued a relevant directive. We agreed with the Ministry of Economic Development to set up an ad hoc group to analyse the situation concerning the Customs Union, namely our borders with Kazakhstan and Belarus, with corresponding checkpoints set up there.

Before we start jointly managing the Belarusian border on July 1, 2010 and the Kazakh border on July 1, 2011, we'll need to submit all the necessary materials and a report on the preparedness of this work to you.

It is a challenging job, which will require synchronised efforts on the part of various agencies, primarily customs services and other supervisory bodies, including veterinary control services.

We have almost finished preparing the Customs Code, whose provisions have been worked out at the preliminary interstate level. The Code must now be approved at the national level to be further submitted for signing.

Only the order of depositing and distributing customs duties hasn't been worked out yet. We are working on the assumption that the ad hoc group supervised by the Russian Ministry of Finance will finish this task in the first half of 2010, and then we'll have to determine the order of depositing customs duties and distributing funds no later than June 1, 2010.

Kazakhstan requests that we address a series of issues before signing agreements on November 27. Astana asked us on several occasions, and also asked you personally, to settle the issues connected with transporting oil and gas and railway tariffs. Work on these issues is in progress. I would like you to give additional directives so that we'll finish this job soon.

We have been working on this issue with the Ministry of Energy, Russian Railways and the Ministry of Transport. We believe that it is a routine job that is not need to be completed by November 27, but this is what our Kazakh partners are asking. We'll try our best, but in my opinion, these unsettled issues must not compromise our efforts to establish the Customs Union.

Vladimir Putin: Honestly, I didn't know about any difficulties in this area. I have just met with a Kazakh delegation headed by the Prime Minister in Beijing, and this issue wasn't brought up.

Igor Shuvalov: All right, I'll report to you on it later.

Vladimir Putin: Yes, I would like to know what the difficulties are. And if there are any, what are they?

Igor Shuvalov: These difficulties are not hindering our work, as I said. Rather, we need to coordinate our positions and try to pull off this job at the national level, through Kazakh and Russian agencies, to complete all the preparations for signing intergovernmental agreements.

Vladimir Putin: Good. A Government resolution to purchase a vaccine in 2009 to prevent the А/H1N1 virus in Russia has been signed. Mr Zubkov, could you give us some feedback, please? How has the work progressed?

Viktor Zubkov: Mr Putin, colleagues. The resolution you have signed is very timely. It will enable us to mass produce and build stocks of the vaccine immediately following the completion of clinical tests, somewhere around early November.

As you know, the Government has already allocated 340 million roubles to develop the vaccine. It needs to be said that the situation in the world today is not simple. The total number of laboratory-confirmed А/H1N1 cases worldwide is currently 388,000 people, with 4,820 fatalities. Russia currently has 876 cases. Of these, 570 were infected in other countries.

Following my directive, the Deputy Minister for Healthcare and Social Development meets with the press weekly to discuss the situation and the steps we are taking. We are going to continue this practice.

The funds that have been allocated with the resolution you have signed - almost 4 billion roubles - will go towards purchasing, manufacturing and stocking almost 3 million doses of anti-virus vaccine. This will allow us to vaccinate one third of the population.

Consequently, we will cover all Russian citizens in the risk groups - health care workers, social workers, preschool and school children, students, servicemen, transport and communications personnel.

Vaccine production will be set at Russian companies in Ufa, Yakutsk and St Petersburg. All of these companies are ready to start mass production. The timely posting of funds will enable them to start mass production according to schedule.

The commission that you organised is working on the А/H1N1 flu. The commission meets regularly, assesses the situation and monitors the regions. The next session of the commission is planned for Thursday, October 22.

Vladimir Putin: Good, thank you. Ms Golikova, what is the situation with respect to the entire pharmaceuticals market?

Tatyana Golikova: Mr Putin, colleagues. In accordance with the Government resolution you signed in August, together with the Federal Service for Supervision of Healthcare and Social Development, we conduct monthly - the Government provides quarterly - monitoring of pharmaceuticals prices.

We monitor outpatient clinics sector, hospitals, purchase and retail prices, as well as mark-ups. Among pharmaceuticals prescribed at outpatient clinics, there is a slight but clear trend of decreasing prices. Compared with August, prices in September fell by 0.27%. They fell the most in the Central and Northwestern federal districts, by 5% and 3% respectively.

At the same time, the Far Eastern, Urals and Southern districts continue to show slight price rises. Prices grew by 2.2% in the Far Eastern, by 1.13% in the Urals and by 1.12% in the Southern.

Nevertheless, in one federal district, there was a multi-directional trend. In some constituent entities of Russia, outpatient prices are falling sharply, and in other constituent entities, they are rising. In the Central Federal District, price growth was recorded in September compared to August; in the Tver, Ivanovo and Belgorod regions by 2.6%, 1.4% and 1.2%, respectively.

As for medicine purchase prices, they have remained practically the same since January, with only a decrease of 0.02% over the last eight and a half to nine months.

Purchase prices have fallen by 2.4% in the Central Federal District and by 4.5% in the Northwestern Federal District since August. They continue to rise in the Volga and Southern federal districts.

The Central Federal District has the lowest trade mark-ups, at 20.5%, as compared to 24.2% in August and 23.7% in September.

Data from September are indicative because it is in that month when seasonal price fluctuations are most significant. There was no significant increase in prices in the first half of September. Trade mark-ups remain rather high in the Urals Federal District, at 30.6%, and the Far Eastern Federal District, at 28.4%, despite all the inspections that have been carried out by the Procurator General's officers and our service.

Medicine prices for hospitals have come down by 3.3%.

You often see reports in the media that the amount of imported medicine that the Russian Federation is buying is shrinking, but nothing of the sort is happening. We are continuing to monitor the situation, and expect to see that the level of imports in 2008 will be the same at the end of this year.

And, in accordance with the resolution you issued, by the end of the year we should be able to introduce a procedure for registering maximum manufacturers' price of medicines on the list of essential drugs. According to the current procedure, all Russian and foreign suppliers must register prices for essential drugs by March 1.

Vladimir Putin: Good. How are the preparations for pension reform going? Base pensions should increase by 30% on December 1.

Tatyana Golikova: By 31.5%, to be precise.

Vladimir Putin: All right, by 31.5%. What are your Ministry, the Pension Fund, and the Finance Ministry doing to meet the deadline? And don't forget that just one month later, on January 1, 2010, pensions for persons with Soviet work records will also be recalculated. This increase will affect all components of the pension, not only the base component. What are you doing to prepare for this increase?

Tatyana Golikova: According to the plan approved by the Government, we are to draft 15 Government resolutions and 20 resolutions of the Health and Social Development Ministry. We have submitted nine Government resolutions for today.

Vladimir Putin: Only nine out of 15?

Tatyana Golikova: Yes. The Government has approved three of them. We have finished working out the other six with relevant federal agencies, and they will be submitted to the Government quite soon. We are also ready with four of the Health Ministry resolutions. One of them has been registered, and the Justice Ministry is registering the other three.

The other resolutions have been drafted. As soon as they are ready, they will appear on the Ministry website for expert evaluation-in particular, to analyse their susceptibility to corruption. This is in accordance with established Government procedure.

Today we must also discuss amendments to the Health Ministry Regulations, because due to the latest legislative amendments, we need the right to issue orders with powers of decree.

Beginning on January 1, 2010, the Pension and Social Insurance funds will manage insurance fees, and relevant technical, organisational and personnel changes are underway. Beginning on October 1, 3,000 Pension Fund employees will be retrained to manage insurance fees and maintain individual records.

We have prepared a system for collecting insurance fees and maintaining individual records. We will begin testing it on December 1 so that we can put it into effect in January.

It is also worth mentioning that we met with regional representatives on September 30. The meeting concerned additional welfare payments from federal and regional budgets to raise pensions to the level of a living wage. Such payments will come from the federal budget in regions where the cost of living is above the national average.

Regions where the cost of living is above the national average will make payments out of their own budget, for which they will be entitled to federal support.

Vladimir Putin: You might have meant "the cost of living below the national average" in the former instance. Am I right?

Tatyana Golikova: Certainly, below. I am sorry. The preliminary data we have compiled as of today indicate that federal additional welfare payments will affect 3.6 million pensioners in 65 regions, including at the Baikonur space centre. Another 2.3 million will qualify for regional payments in the 21 regions where the cost of living is above the national average.

We have received data from all the regions to calculate living wages for pensioners. Twenty-five regions have issued relevant statutory resolutions. The other regions have an idea of the living wage. What they need is legislation, whose category depends on what body-executive or legislative-will pass them.

Last but not least, valorisation, which you have mentioned, will affect 36.5 million people. The average per capita pension increase beginning on January 1, 2010 will be 1,100 roubles, and 1,600-1,700 roubles for people above the age of 70.

The State Duma is debating amendments to the Pension Fund budget. The amendments envisage payments starting at the end of December for people who get their pension in the first ten days of January. Their regional and federal additional payments and money they get from the valorisation of pensions will be recalculated, and relevant payments will be made in December.

I would like to emphasise the fact that the new system will not make pensioners fill out paperwork for additional payments and valorisation. As the law stipulates, it is only necessary to apply to the local Pension Fund office for recalculation only when the increases of both components of the pension are inadequate.

Vladimir Putin: Please monitor this situation closely at the federal level-I mean in preparing relevant legislation, including Government resolutions and executive orders-and at the regional one. We must meet all the deadlines and prevent setbacks at the beginning of this programme.

Tatyana Golikova: Mr Putin, we have scheduled another meeting with regional representatives for November 25. Please attend it if you can. The meeting will summarise the initial results of the regions' preparations for putting the amended decisions into effect, beginning on January 1, 2010.

Vladimir Putin: Okay, I will check my schedule and try to find an opportunity. A resolution has been signed for the unified application of the federal law on mandatory social insurance in case of temporary disability and childbirth. Please elaborate.

Tatyana Golikova: First, we are shifting from unified social taxation to insurance fees to improve mandatory social insurance for maternity and sick leaves.

Beginning on January 1, insurance payments will be required from annual earnings below 415,000 roubles. Accordingly, all maternity, children's and temporary disability allowances will be paid depending on the amount of social insurance fees.

The Social Insurance Fund previously appointed a maximum allowance not to be exceeded, irrespective of insurance fees. Now, the maximum has been eliminated, and allowances will depend solely on the amount of previous fees.

Let us take monthly children's allowances. The maximum for this year is 7,492 roubles. The new maximum sum will be 13,833 roubles.

Maternity allowances will be the equivalent of the recipient's entire wage, as opposed to the previous level of 40%. The maximum will increase from 25,390 roubles to 34,583.

The same concerns sick leave, for which there will be three levels of payment.

The legislation you signed today allows us to work together with the Finance Ministry to clarify the procedure for calculating insurance fees, so that the system will start working smoothly on January 1.

Vladimir Putin: Good. An executive order has been signed also concerning the 2009 Government awards to amateur artists and performers. Mr Zhukov, please say a few words about this issue.

Alexander Zhukov: The name of this national award is "Russia's Soul". These awards are conferred on amateur decorative artists, the leaders and performers of folk companies, etc.

There are 15 prizes, worth 100,000 roubles each. The list of winners has been approved by the Government.

Vladimir Putin: When will there be an awards ceremony?

Alexander Zhukov: Within the month, I suppose.

Vladimir Putin: Will the decorations be awarded in the recipients' regions?

Alexander Zhukov: I think they should have it here at the Government House.

Vladimir Putin: Certainly.

Let us get back to our agenda. I think we should start with the timber industry, especially because the Russian-Finnish Forest Summit is due in St Petersburg on Sunday.

This is why I deem it necessary for the Russian Government to explicitly define its position on the use of forest resources, the development of the timber processing industry, and the basic principles of cooperation with our foreign partners.

Obviously, we cannot be content with just supplying raw timber and with the current state of the industry, in which we are exporting unprocessed lumber and importing derived commodities whose costs are dozens of times greater-construction materials, furniture and paper.

We have chosen to modernise the industry, establish new high-tech plants, create new jobs and come to the international market with competitive finished products. We should also work more to conserve our natural resources.

We have invited our foreign partners to start their own production facilities in Russia on lucrative terms-with no-bid contracts for areas of wooded land and low taxes.

Regrettably, the plans for reform coincided with the global economic crisis, during which demand for timber has slumped, just as investment has.

I do not think, however, that these hardships should make us give up on our previous decisions-mainly because abandoning them would run counter to our general plans for economic diversification and reducing Russia's dependence on its raw materials.

To go back on our word would dampen Russia's reputation as a reliable and predictable partner. That would be unfair to investors who have accepted our new rules of the game and launched projects in Russia.

The Industry and Trade Ministry has approved 75 projects with total 429.7 billion roubles invested, and put them on the priority list. Eight projects have been commissioned, and 16 billion roubles invested.

The timber industry requires greater support in these hard times. We have done something for it already. In particular, we are subsidising interest rates on loans to businesses and lumber exporters. Allocations for purchasing new equipment are being made through Rosagroleasing. Many plants are on the Government list of essential companies, which entitles them to government guarantees.

We will analyse some more measures to help modernise the lumber industry-subsidising interest rates, reducing customs duties for certain technologies to zero, and the extending the period for acquiring areas of wooded land without registering it with the government land cadastre until 2015.

As for export duties on unprocessed lumber, we take our producers' and their foreign partners' problems into account. So we have postponed the planned increase in export duties to a prohibitive 50 euros per 1 cubic metre. We will announce our final decision quite soon. As for next year, we will proceed from the current situation.

On the whole, we should remain deliberate and predictable in everything that concerns our customs tariff policy. We did not resort to total protectionism and close our markets, even at the height of the crisis. On the contrary, average import duties were reduced almost by 1% from 11.45% to 10.7% in 2009.

Selective protective measures were taken to support the most vulnerable sectors of the economy. These are temporary measures to be abolished as the situation stabilises.

It is our duty now to formulate a comprehensive policy for controlling customs tariff regulation suited to our post-crisis objectives.

First of all, we should make our manufacturers more competitive. They should find it profitable to borrow foreign cutting-edge technologies, purchase the latest equipment, and thus promote the modernisation of Russian industry.

Russian high-tech exports need comprehensive support. Our customs tariff policy should not be an obstacle to competition on domestic markets, and thus generate monopolies.

We will closely coordinate our action with our partners in the emergent Customs Union of Russia, Belarus and Kazakhstan.


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