Point of View

“Support from Russian citizens has always helped us, and I’m confident that the government’s future line-up will rely on the people. We must never forget about the needs of ordinary people. We must always remember how government-level decisions influence the lives of all ordinary Russian citizens.”

"We must change the structure of the energy balance to increase the share of the so-called non-fuel power generation, non-fuel sources of energy such as nuclear power generation, hydropower generation, and other renewable resources. As for hydrocarbons, the key priority should be a deep conversion of the commodities, the production of high value-added output, and the development of modern gas chemistry and petrochemical sectors. The share of power generation should grow to 14% by 2030, and the depth of conversion to 90% from 72%."

“We will stimulate subsidies to balance the budget. Their size will depend on the current share of severance tax revenues in the budget of each particular region. The decision will concern 32 regions, and we will work with each of them separately to balance their budgets. Also, all revenue from the management of the assets of the Reserve Fund and the National Welfare Fund will be transferred to the federal budget from January 1, 2010. In addition, the share of profit which the Bank of Russia will be obliged to transfer to the federal budget will be increased from 50% to 75% in the next three years.”

“We propose transferring the severance tax (mineral production tax) to the federal budget in full beginning next year. At present, 95% of the severance tax is transferred to the federal budget and 5% to the budgets of Russia's constituent entities. In the past, we permitted that minor deduction to the regional budgets, but the decision to transfer 100% of the severance tax to the federal budget will increase it by at least 46 billion roubles in 2010.”

“As you have seen and heard today, a gas pipeline to Tskhinval has been launched today. As I have already said, it was laid in a record short time along a complicated alpine terrain, and rids the republic of its dependence on gas supplies via Georgia. This was also Russian gas but it was supplied via Georgia. Now South Ossetia itself can become a transit country for Georgia.”

“There was no other way of ensuring this stability but to recognize the independence of both republics, because we realized that the current Georgian political leaders will not leave them in peace. It is necessary to establish the conditions for ensuring reliable security for the long term.”

“I would like to draw your attention to the fact that Russia is also supporting Georgia. I'm sure you know that Georgia is receiving no small amount of assistance through the International Monetary Fund (IMF). We are an active member of the IMF, and regularly make serious contributions to this international organisation, which are then distributed among the distressed countries, Georgia included. This shows once again that we are not interested in humiliating Georgia, and we are not interested in having losers and winners here.”

"Much has been done since then for developing full-scale relations between Russia and South Ossetia and for consolidating their legal foundation. In September 2008, we signed a Treaty on Friendship, Cooperation, and Mutual Assistance, and last April, the Agreement on Cooperation in the Protection of South Ossetia's State Frontier. The Russian border guards have assumed responsibility for securing peace and tranquility in the region."

“Russia has appropriated about three billion roubles - 2.8 billion roubles, to be exact - for supporting the republic's budget this year, and another 8.5 billion roubles for restoring the infrastructure facilities. Out of the 8.5 billion roubles, 3.5 billion roubles have been spent. Let's see what can be done in the remaining months of this year. We have agreed with the republic's President that if some funds are not spent, we will not rush to meet the deadline for spending them. The main task is to guarantee the quality of construction.”

"Despite certain economic difficulties, we have kept our space projects on the budget priority list. This year alone almost 82 billion roubles have been appropriated for these projects under three federal programmes. Let me specify that these allocations amount to 58.2 billion roubles under the Federal Space Programme, another 15.3 billion roubles under the federal targeted programme GLONASS Global Navigation System, and yet another 8.2 billion roubles under the federal targeted programme on developing Russia's defence and industrial complex in 2007-2010 and beyond. Thus, the total is 81.7 billion roubles."

"The Government has adopted a number of anti-crisis measures to stabilise the financial position of the industry's individual companies. I am referring to additional capitalisation, and the granting of state guarantees and subsidies. A total of eight billion roubles have been allotted to the Khrunichev State Research and Production Space Centre, and state guarantees worth three billion roubles have been granted to the Energomash Joint Stock Company. The Government has also made decisions on granting subsidies to a number of other organisations of this industry."

"Let me recall that our strategic goals in this respect are to make the domestic space industry more competitive, and to more effectively use its potential both for resolving domestic socio-economic tasks, and for entering high-tech international markets. Obviously, we should not forget the industry's role in our defence capability. Defence-related projects amount to 63% of what is being done in the missile and space industry."

"The Government has determined to develop it comprehensively for the greatest possible thrift and effect. As we see it, this development concept will consolidate the state's and mining companies' efforts and cut expenditures. If we establish a common transport network, power grid and welfare system, the job will be quicker and more efficient, and will cost much less-which matters most-than when every involved company builds an infrastructure for itself on its own. Several managers have said so today and, I think, everyone sees their point."

"The Sayano-Shushenskaya hydropower plant is the key element, the backbone of Siberia's energy system. Several regions, the housing and utilities sector, and many enterprises, including five large metallurgical companies, depend on it. I want you to take proper measures to guarantee uninterrupted and stable electricity supply to the cities and industrial facilities."

"At the same time, hydropower plants - this plant and other hydropower plants - produce relatively cheap electricity, and its replacement with electricity produced at other types of power plants must not cause an increase in prices. We all know that we live in a market economy, and it is clear that replacement of hydroelectricity with electricity produced at thermal power plants is possible and will be justified in this situation, but three must be no price hikes."

"In general, we should check all strategic infrastructure facilities, scrutinising the process of their modernisation. This means also the introduction of new automated control systems. However, it is clear already now that we must improve compliance with technical, technological discipline. These issues merit special attention."

"We should draft a clear plan of restoring the plant. This work has been entrusted to the Ministry of Energy and RusHydro, which must use all available possibilities in the sector, such as personnel and research and technical capabilities. The plan is to be drafted and submitted to the government commission within six weeks, and to be approved by a government resolution."

"Our main goal now is to help those who have lost their relatives in the tragedy, and all those who have been affected. As you know, RusHydro has decided to pay 1 million roubles to the families whose relatives have died. This is a good decision, but it is not enough. Payments should also be made to the families of those whose relatives are missing. We know now what happened and why, and nobody must pretend that they don't know the reasons. Moreover, we should make additional payments, including to minors aged under 18. One-off payments, of 1 million roubles, will be made to the families whose members have died in the tragedy or are missing, and one-off payments will also be made to other victims."

"The Government has decided to speed up the construction of a series of energy facilities. I am referring to the Neryungry Thermal Power Plant-Tommot-Maya line and the Suntar-Olekminsk line. This year alone, 3.5 billion roubles has been allocated for these purposes. There must be no delays in their construction."

"We will concentrate only on the north, though larger-scale development will also come up in our discussion. The north of the Krasnoyarsk Territory possesses 67% of Russian natural gas deposits, 60% of gas condensate and 15% of oil. Geological prospecting will go on, and promises more discoveries. 236 oil and gas fields have been discovered for now, and another 63 are being explored. It all makes mere 20% of oil deposits, 35% of gas and 17% of gas condensate. Experts assess summary potential yield as exceeding 115 million tonnes by 2020."

"A critical decision has been made to introduce the zero export duty rate for oil mined in certain Eastern Siberian fields, which include Vankor. All relevant bylaws must be passed urgently to make this norm work."

"As you know, the state has substantively expanded diamond purchases to support the industry. It has been decided to quadruple the funding being allocated for buying precious stones for the state treasury: this amount has grown from 3.7 billion roubles to 14.5 billion roubles. But I think even that is not enough. We understand that an industry that provided serious revenues both for the federal and the regional budget is in a difficult situation due to the global economic conditions and needs to be supported. I just had a discussion with mine workers and I would like to repeat here what I told them -that in total state support for the industry this year must amount to 30 to 35 billion roubles."

"In the current year, the Housing and Utilities Reform Fund has allocated more than one billion roubles for Yakutia - a substantial amount. These funds should be used to the utmost effect to solve the main problem for which the Fund was set up, namely to provide residents of dilapidated and unsafe buildings with new housing. Unfortunately, there is a great need for that in Yakutia."

"We have a programme for the development of the Far East and the Trans-Baikal region. Let us see how the work is proceeding here, in Yakutia.<...> A number of additional decisions have been adopted on the area's all-round development. We have launched and continue implementing a federal targeted programme on the Far East and the Trans-Baikal region, which provides for a substantive renovation and expansion of Yakutia's infrastructure: construction of new bridges, airports, railways and highways."

"The Eastern Gas Programme is also off to a good start. Its priorities are to pipe gas to the regions. The republic's head has just reported gas demand for Lensk is fully satisfied. At any rate, efforts have been made to reach the programme's targets. Next in line are Mirny and other towns and cities.<...> We are already seeing positive results. Yakutia's regional gross product has increased more than one-third between 2003 and 2008, while investment in fixed capital has grown 50%."

"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."

"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."

"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."

"We are witnessing the establishment of key elements of the national nanotech network, which includes publicly accessible research centres. Therefore, I think it expedient to extend the term of the federal targeted programme Infrastructure Development for the Nanotechnology Industry for another year, that is, through the end of 2011."

"At this stage, I think it is extremely important to create and stimulate domestic demand, an approach that involves, among other things, the Government procuring nanotechnology products for Government needs and for the needs of companies in which the Government holds stakes, such as healthcare, educational, research and housing and utilities companies. And if we are discussing the allocation of federal resources, investing in innovative technologies is certainly the best decision we could make."

"Judging by the available data, which is quite abundant, we have established a good foundation for the development of technologies connected with medicine, diagnostics equipment, environmental protection, saving energy and the production of innovative composite materials. Almost a thousand enterprises of the real sector of the economy are working in the area of nanotechnology industry."

"Let me repeat that we intend to invest in aircraft construction, and will do so, but we need real results. I would like to emphasize that the industry must function in market conditions. We realize full well that the situation is difficult, and that your rivals in the world markets are enjoying direct support from their governments. However, to start with, we should not repeat the stupid mistakes of others, and we should work effectively. And, second, we cannot resort to this practice all the time. We can work effectively in this country, and we should achieve this by all means."

"At the same time, the aviation industry is going through uneasy times, to put it mildly.<...> I mean inadequate quality of corporate management, high costs, and low economic efficiency of labour productivity. There are many examples.<...> It may seem strange, but a whole series of United Aircraft-Building Corporation (UABC) contracts for the delivery of aircraft both at home and abroad have brought only losses instead of profits.I would like to ask UABC and relevant departments to analyse this situation in detail, and to submit proposals that would prevent such setbacks in the future."

"Furthermore, aircraft construction has found itself in an extremely difficult financial predicament. Before coming here, we held two other meetings, trying to carefully analyse the financial situation. The total debt of UABC and its subsidiaries is more than 119-120 billion roubles. Moreover, there is a deficit of 64 billion, which is not guaranteed by their revenues or profits."

"At the same time, it goes without saying that in light of this force majeure, it is necessary to draft a programme for financial stabilisation, and help aircraft builders to get rid of the so-called "toxic" debts. This programme of financial recovery should be submitted to the Government during the next month, or, at most, in a month and a half."

"Now, before our meeting, record contracts were signed here at MAKS for the purchase of 48 SU-35Ss, 12 SU-27SMs, and four SU-30M2s, for the total sum of over 80 billion roubles. The aircraft will be delivered until 2015. Obviously, this will allow us to equip our Air Force with the latest technology, and to keep our aircraft companies busy, which is always important, especially during the crisis."

"I want to add that literally over the last few days, the Government has made a similar decision: 3.2 billion roubles from the state budget will be allocated for additional capitalization of the Sukhoi holding company. Today, we will also discuss the possibility - and I want to emphasize this - we will discuss the possibility of adding another 15 billion roubles to the capital of RSK Mig. We already gave 15 billion, and today we met with Mikhail Pogosyan and discussed this issue. He is in constant contact with Sberbank. We had already discussed this issue previously, when we gave 15 billion roubles, and we will discuss giving another 15 billion."

"Starting in 2004, state financing for aviation increased 20-fold, I want to emphasize this and draw your attention to this, ladies and gentlemen. Not by a percentage, but 20 times over! Just this year, taking into account anti-crisis measures, we allocated another 80 billion roubles for these purposes. The funds were spent on the purchase of Russian airplanes and subsidizing the expenses of technical upgrades for our companies. Around 35 billion roubles from the budget were allocated for increasing the authorized capital of key companies in the industry. These are the RSK Mig company, which received 15 billion roubles, the Chernyshev MMP company, which received 2.9 billion rubles, the Kazan Gorbunov Aircraft Production Association, which got 4.1 billion roubles; and Motopostroitel in Samara, which received 1.4 billion roubles. The annual allotment in authorized capital for UABC to build civilian aircraft is another 6 billion roubles."

“We have singled out development of aircraft engineering, along with the space industry, shipbuilding and nuclear energy, as key priorities in Russia’s industrial policy. Due to these specific industries, we expect a significant increase in the share of high-tech production in the Russian economy, thereby increasing the economy’s sustainability and diversifying its exports.”

"Also, there is another ugly problem, absolutely unacceptable in a civilised society. I would like to draw your attention to it now. Unfortunately, child abuse is still quite frequent in Russia, and orphans sometimes fall victim to it. There have been flagrant and ugly child abuse cases reported in orphanages and sometimes even in adoptive families. I am asking prosecution authorities and social services to keep an eye on the issue, put additional effort into it and submit additional proposals on legal protection against child abuse."

"I also think that adoptive parents should be selected and prepared with more discrimination. It is not a question of arranging just any adoption for a child, but to give the child a real family and a safe and happy life."

"I would like us to discuss support for orphaned children and children with disabilities. This year's federal allocation for this purpose is 70 billion roubles. Orphans have regular compulsory medical check-ups, and the number of medical centres providing high-tech medical services to children with disabilities is growing."

"A programme has started this year to provide long-distance training for children with disabilities, giving them the opportunity of receiving a high-quality modern education. This is essential for their integration in society as adults, for successful careers and reasonable incomes and high living standards. In the first half of 2009, over 2,500 children with disabilities enrolled in long-distance education programmes, including those involved in the pilot projects. This number sounds fine unless you consider that as many as 35,000 children need this special long-distance training. I believe that each of them should be given the opportunity by 2012."

"Now I would like to talk separately and in more detail about the Housing Project. <....> Unfortunately, today the scale of construction has decreased by almost 20%. Mortgage has abruptly fallen by six times. The construction industry is going through hard times. Let me recall that so far in 2009 we spent about 450 billion roubles on the government housing policy. We would have wished to spend more, and it might have been worth it, but it was simply impossible. This audience is competent and everyone understands the value of 450 billion roubles. This is huge money which should be used effectively to maintain demand, and to encourage mortgage and housing construction."

"In effect, the government is acting as the key player in the housing market, and hence, is capable of actively influencing pricing and supply structure, and of encouraging the construction of low-income housing, especially low-rise dwellings."

“I would like to emphasise that the cost of one square metre of low-income housing should not exceed 30,000 roubles. This can and should be achieved, and not at the expense of the quality of the housing or the comfort. Importantly, we should proceed from the premise that no less than 40% of our citizens should be able to purchase such flats.”

"In 2009, two federal centres for advanced medical care and research were opened in Russia, with equipment being set up in four more centres. I would like to once again remind you that we discussed at length the need to create them, debating whether it would be more reasonable to concentrate efforts in the federal centre. Practice has shown that the creation of such facilities in the regions is justified. The level of service improves, more high skills specialists are employed in specific areas, and more complex operations are carried out."

"The Government has prepared a series of resolutions to bolster the healthcare and social assistance system. A total of 12 billion roubles is to be allocated in order to offset a shortfall in revenues of territorial healthcare insurance funds. Another 2.2 billion roubles will be allotted for high-tech healthcare, with 2.3 billion roubles earmarked for rehabilitation equipment for disabled people. I met with the heads of organisations for the disabled, and agreed with them on the said measures. This decision has been made."

"Education and healthcare are undergoing an all-round transformation to improve their service quality and to encourage the best specialists. These programmes are under way. The average salary for teachers in the regions - I'd like to note: not in all regions, but only in the regions where complex education modernisation projects are being implemented - have increased by 30%."

"This year, some 450 billion roubles has been allocated for the national projects. These are considerably large funds, and I would like to highlight that we did not economise in this area. I would also like to add that a number of new programmes have been launched within the framework of the national projects."

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