RUSSIA REPLACES WELFARE PRIVILEGES WITH MONEY GRANTS. ALL SHIFT SPENDINGS OUT OF FEDERAL PURSE, INSISTS MINISTER

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MOSCOW, June 29 (RIA Novosti) - The federal government ought to shoulder all reform expenditures as Russia is shifting to monetary welfare grants from privileges. This widespread opinion has found a strong supporter in Mikhail Zurabov, Minister of Health and Social Development, he said to Novosti.

Our reporter interviewed Mr Zurabov late this afternoon after a budget committee session of the Federation Council, parliament's upper house. Senators had been debating a bill on the social welfare reform.

The bill earmarks 170 billion roubles, slightly below US$6 billion, out of the federal purse. Regions ought to take up other reform expenditures, at a lump 70 billion roubles, while the minister thinks the entire sum ought to come from the federal budget.

Several Senators addressed him during the debates with similar blueprints. If the arrangement is approved, regions will compensate by ceding into the federal purse a part of fiscal revenues-for instance, from profit taxation, presently at a 3.5 per cent rate.

Certain regional governors-in particular, of affluent donor areas-are, on the contrary, shrugging the pattern off, Mr. Zurabov pointed out to Novosti.

A list of persons entitled to welfare grants or privileges must be drawn within a few next months to come on the federal Pension Fund payroll. Welfare registration is the most painstaking task for now, he added.

The federal centre may assume all expenditures on grants to exonerated victims of political reprisals, to veterans of the World War II rear effort, and to underage persons of low-income households. That will be possible only in case all revenues are centralised, stressed Mikhail Zurabov.

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