TRANSCRIPT OF THE MEETING BETWEEN PRESIDENT OF THE RUSSIAN FEDERATION VLADIMIR PUTIN AND HEAD OF FAS IGOR ARTEMIEV
Vladimir Putin: Igor Yurievich, I’d like to start with something our people constantly pay attention to, particularly, and you saw it, during the last “Direct Line” – it is unreasonable, in their opinion, growth of tariffs in many regions of Russia.
Let’s start with this. Please pay special attention to it, and then we’ll talk about other issues.
Igor Artemiev: Dear Vladimir Vladimirovich!
True, the Government of the Russian Federation for many years has not been setting tariff in Russia higher that inflation, under the “inflation minus” principle.
It is something that continues for already many years but in the 1990s laws were passed that left, to be precise, 12 “holes” in the law that allowed municipalities and regions to reasonably, in terms of the law, exceed the indices set by the Government, and it did happened. For instance, in there were 1423 such incidents, then the figures started decreasing: 2018 there were 498 such cases.
Following your orders and the orders from the Chairman of the Government, the “holes” are now closed. The Government passed a decree on the housing-and-utility complex that prohibits higher tariffs that set by the Government, and the State Duma adopted amendments to the Law “On the electric power industry”.
If tariffs are below the economically justified level, and tariffs must be increased slightly higher than inflation, an approval from the Federal Antimonopoly Service is necessary, and we will be fully responsible before you for our work. The story that lasted for 20 years due to those laws form the 1990s is over.
Vladimir Putin: No exactly.
If it was over, people would not complain calling to the Direct Line.
Igor Artemiev: Absolutely correct but talking about Omsk from where the complaint was, it concerns a fresh decision of the authorities. It was made before the Governmental Decree was issued, it was just passed, but we already took in this situation, the tariff is overrated twofold, investigations were performed, injunctions issued, and accordingly, the authorities are now halving the tariff.
Vladimir Putin: Good.
I’d like very much that the world and papers produced in great quantities at different levels, are consistent with the essence of the decision made; so that people see that these decisions work in the actual life.
Igor Artemiev: We’ll try hard, and we’ll answer to you for this.
Vladimir Putin: Right.
Please, you also wished to talk about the National projects.
Igor Artemiev: Yes, if possible.
I’d like to discuss two very important issues. Some time ago you signed the order approving National Plan for Competition Development in Russia.
The Government adopted 17 sectoral programmes for competition development, and each Governor signed an order to develop competitor in a particular region.
It is necessary to improve efficiency of the economy, increase labour productivity, decrease prices and do many other useful things.
The May orders on the National projects should be naturally connected with the Order on developing competition in Russia because the National projects say nothing about competition in their programme decisions.
Obviously without such connection, the enormous money given to the social field to help people live and work, they must …
Vladimir Putin: It all will spiral into a price growth.
Igor Artemiev: Yes, so long that it is not just ultimately use of funds.
Therefore, the Chairman of the Government ordered to bring our representatives to the project committees, and we fill saturate these National projects with the novelties from your Order on competition development.
Because it is not only important to build the facilities that will generate considerable benefits to our people, but also that it develops in competitive environment, that there are no price growth and monopolism, which we must counter.
It is understood by the Government. I seek your support on the issue.
Vladimir Putin: Well, it is very important, I agree.
Igor Artemiev: And one more question. I’d like to report on executing your order to counter cartels.
Today we estimate harm from price collusions in different commercial structures, at tenders and auctions and in the economy at approximately 2% GDP.
You gave a relevant order.
Vladimir Putin: 2% GDP?
Igor Artemiev: Yes.
There are thousands of cartels; the most “cartel–clogged” sectors are the pharmaceutical industry and road construction. Collusions invade nearly 80–90 % of public tenders and auctions.
We expose it together with the law enforcement bodies. Already around 15 cases have been opened, some cases are finalized and some people already got jail time.
A new law on intensifying anti-cartel efforts, drafted by FAS jointly with power structures, discussions took place with all business unions and their comments are taken into consideration.
WE approved the new law with all federal executive bodies, it is going to the Government and then to the State Duma.
It seems that the law will be passed in autumn, but for us your order is principally important, that we are executing it, and overall, everybody should probably understand that jokes are over.
It is a great wrong that now harms our economy, it is necessary to fight against consistently, and the new law certainly will enable FAS and our colleagues from the law enforcement bodies to do it much more efficiently.
Vladimir Putin: Good.
It will be necessary to analyze enforcement practice and see what is happening in the actual life.
Igor Artemiev: Will do.