The plan leaves much to be desired, Deputy Prime Minister Alexander Zhukov remarked during debates. In particular, it envisages loans growing on, with the bulk of borrowed money earmarked to increase corporate circulating funds, while it ought to go to investment projects, advised the Vice-Premier.
The company non-production sphere is working at a loss. Close on 40 billion roubles, roughly US$1.5 billion, is expected. What the company needs is a plan to reduce the losses, Mr. Zhukov went on. He insistently called to evaluate the doubtful expediency of investing in Russian Rail property to be alienated in an upcoming company reform.
No federal allocations have been earmarked for next year to reduce cross-subsidising, but some grants may be coming a year later, Igor Levitin, Transport Minister, said to the media following the session.
The conferees, he said, had discussed the problems of cross-subsidising-an arrangement on which freight rail transportation covers up passenger transport losses. Railways are not so closely dependent on cross-subsidies as before-by two billion roubles this year, as against 65 billion total losses, pointed out certain speakers.
The Russian Rail ought to substantiate its borrowings in next year's investment programme, stressed Hermann Gref, Minister of Economic Development and Trade. The company intends to borrow 40 billion roubles-and a mere 9.5 billion of this will go to investment projects. Enough is enough, said the minister. Whatever borrowings are made should be channelled into rewarding investment projects.
It must be up to the Federal Tariff Service to make tariff differentiation decisions. The Service ought to coordinate such resolutions with his ministry on a procedure the Russian Rail has approved, added Mr. Gref as he called the gathering to enter the point in the session decision records.
It was previously up to the Railway Ministry to differentiate tariffs-a problem-laden arrangement, which aroused frequent controversies, he said.
A government decree has been drafted to pass to the Federal Tariff Service the duties of granting extraordinary tariff terms for particular railways and particular cargoes. Coordinated with all involved agencies, the draft has been passed to the Justice Ministry for consideration. As soon as it is ready, the document will go to the Cabinet for approval, said Sergei Novikov, Federal Tariff Service chief.
