VLADIMIR PUTIN
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VLADIMIR PUTIN

Media Review

18 december, 2008 19:40

Komsomolskaya Pravda: "Rise in tariffs has nationwide causes"

People will pay more for gas and other utility services starting January 1, 2009. Before the crisis, there was a sort of tacit agreement between the Government and energy companies whereby Russians had to pay the minimum and Western clients the maximum for energy. Now it seems that energy companies are determined to make domestic consumers pay more.

People will pay more for gas and other utility services starting January 1, 2009. Before the crisis, there was a sort of tacit agreement between the Government and energy companies whereby Russians had to pay the minimum and Western clients the maximum for energy. Now it seems that energy companies are determined to make domestic consumers pay more.

In early December, this idea was expressed most clearly by Sergey SHMATKO, Russia's Energy Minister, at a news conference in Yekaterinburg. "It would be wrong to talk about the freezing of tariffs, for our tariffs do not exceed the European ones," he said.

However, they should not exceed the European tariffs, for fuel has to be brought to Europe, while we have it here on hand. The very next day, Prime Minister Vladimir Putin said to his direct subordinate that "we can at least demand lower tariff growth rates from these infrastructure monopolies".

The Prime Minister suspects, and not without reason, that our energy monopolies are trying to implement their investment projects at the expense of ordinary people.

It is the Federal Tariff Service (FTS) that exercises control and supervision over tariffs, and in this situations it has to act in a way that would suit both Shmatko and Putin: Should the tariffs grow, let them grow, but gradually - to prevent energy companies from going bankrupt, on the one hand, and from fattening with their profits, on the other. With these aims in mind, the FTS has set certain ceilings on tariff growth while permitting the regions to adjust them with due account for local specifics (which was the right thing to do). At a regional level, for example in Moscow, this is done by the Regional Energy Commission (REC) headed by Yuri Roslyak, First Deputy Mayor.

According to Leonid Bratkin, Roslyak's Press Secretary, "the city does not regulate gas prices for the population. The FTS gives us certain figures and we put them into a certain [estimation] scheme that we receive from it. If the federal Government decides to cut tariffs by 10-15% (of which [Deputy Prime Minister Alexei] Kudrin spoke recently), we will recalculate the city tariffs downward."

Monopolies try to implement their projects at the expense of the people

Oleg Shukhov