VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
Prime Minister Putin's introductory remarks:
Good afternoon, ladies and gentlemen,
Today we will discuss one of the most critical issues that we have, in one way or another, revisited several times recently, specifically the need to streamline government regulatory functions. We should regard this issue as part of our overall effort to revamp Russian government administration, increasing the effectiveness of all government bodies.
The financial and organisational burden imposed on ordinary Russians citizens and businesses shows that we have problems with regulation. The high level of corruption and big tragedies such as the one in Perm also demonstrate this.
It is obvious that most regulatory procedures are a mere formality, unfortunately. More often than not inspections are carried out to collect kickbacks rather than inspect anything. This situation cannot be tolerated by ordinary people, businesses and the government. If we want to improve the business environment, which is a must, and encourage the development of small and medium-sized businesses, we must overhaul these procedures, and above all, the very nature of our regulation and supervision.
Ultimately, regulatory agencies must address actual threats, protecting the lives and health of people and protecting the market against low-quality and dangerous products and services. In addition, we must continue reducing administrative barriers, increasing the transparency of our regulatory policies and getting rid of vague legal standards, which swindlers often take advantage of.
It is certainly very important to ensure that inspection procedures do not serve as an impetus for unfair competition or putting administrative pressure on business. On the other hand, we must keep in mind that it is necessary to increase accountability for unscrupulous entrepreneurs who pursue their own private interests without caring to comply with national quality and safety standards.
Over the next few months we will review regulations regarding government services in all key industries and the social area. Today we are starting with agriculture.
We know that domestic agribusinesses are growing steadily. It was hard to imagine a few years ago that these agribusinesses would become profitable, but they have practically already done so. Total output and the percentage of Russian-made produce in our domestic markets are increasing. We are winning over international markets, for instance the market for grain, which we used to import in the Soviet era.
Serious long-term funds have been invested to modernize agribusinesses. However, we must admit that we could have achieved even greater success.
First, high administrative costs are making our products less competitive compared to imports; in many cases they are suppressing business initiative, especially in small companies. In the meantime, these companies account for more than half of some agricultural products, such as milk, vegetables and many others.
In the most modest estimate, in 2009 alone entrepreneurs spent four billion roubles on paperwork for the Federal Service for Veterinary and Phytosanitary Supervision. They spent about the same sum on paperwork at the regional level, and this is not counting the continuously increasing expenses for all kinds of expert evaluations imposed by government institutions. Moreover, many of these institutions are still combining their government regulatory responsibilities with paid services.
Sometimes the situation becomes absurd. We have seen how this cycle functions. For instance, to transport imported fruit or vegetables from St. Petersburg to Chelyabinsk, you have to receive a new certificate every time at least one box of produce is unloaded. More than a million such certificates are issued in the country every year. The same applies to flowers, seeds and so on.
This is how a huge, corrupt market is formed. Here we have, to tell the truth, fertile ground for corruption. Ultimately, the services of this market are paid for by consumers.
Furthermore, there is no need to explain how important safety is for the production and sale of food products. However, for all its external appearance of reliability, the existing system does not guarantee either full or the most effective quality control.
The same certificates are often issued without any inspections. Veterinarians do not even actually see what they are supposed to inspect. They simply formally re-write and stamp papers.
There are still companies that operate in the so-called grey area, producing foodstuffs (primarily meat products) without any supervision and committing violations of basic sanitary requirements and rules. This is how ineffective quality control and supervision sometimes are.
The fact is that the regulatory system for agribusinesses is creating problems for honest producers. Those who smuggle illegal or poor quality goods into the Russian market, including imported products, easily circumvent these requirements and find themselves in a more beneficial position. They are making undeserved profits, and, what is the worst, threatening the health and even lives of consumers.
And there is one more important point. There are no clear-cut relations between federal and regional government and administrative bodies to regulate agribusinesses. This particularly applies to prompt responses to local outbreaks of veterinary diseases. Precious time is impermissibly wasted on mutual shifting of responsibility and interdepartmental correspondence. And during this process, losses for producers are growing along with budget expenditures to deal with the consequences of these emergencies.
I believe that today we should make comprehensive decisions for reforming the system of veterinary and phytosanitary oversight, including by amending federal legislation and departmental normative acts.
We must switch over to modern, market-oriented regulation. We must use accreditation and insurance mechanisms and the potential of independent organisations to check the quality and safety of produce.
I would like to repeat that now that excessive regulation is being reduced, all participants in the market should act more responsibly. These processes should be interconnected and parallel to each other. The final protocol should reflect everything on which we agree today, and this document should lay the foundation for legislative and subsequent government decisions.
Let's get down to work.
