National projects would revive Russia

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MOSCOW. (RIA Novosti political commentator Alexander Yurov). -- Early last autumn President Vladimir Putin voiced the initiative to implement four national projects in Russia: on healthcare, education, housing and agriculture.

On October 21, 2005, the composition of a council on the implementation of these projects was approved, with the president as its head, and Dmitry Medvedev, First Deputy Prime Minister, as first deputy head. Other government officials, governors of a number of regions, the speakers of both houses of parliament, the president of the Russian Academy of Sciences and the rectors of Moscow State University and St. Petersburg State University became council members. A month later the council held its first session to outline a program of top priority measures on the implementation of the national programs.

The government has allocated 138 billion rubles for the four projects, and together with off-budget means and state guarantees this will amount to 180 billion rubles ($6.4 billion). As a result, in 2006 the total budget spending on education and agriculture will increase by over 30%, on healthcare - by 60% and on housing and related infrastructures - fourfold. These allocations will be added to the budget funds already stipulated for the development of related sectors. "In essence, priority national projects are the mechanism that will help us improve the living standards of every Russian citizen," Dmitry Medvedev said.

The national project on education provides for state support to young people on the basis of merit. There are plans to establish 5,000 individual grants to the tune of 60,000 rubles (over $2,000) and 100 youth projects worth 800,000 rubles ($28.4 thousand). Thirty Russian higher education establishments are to receive 500 million rubles each ($17.7 million) and 600 secondary schools would get 1 million rubles each ($35.5 thousand) in the next two years. Soldiers on compulsory military service will be entitled to primary vocational training certificates in 100 special centers.

The education project also provides for higher incomes for teachers and academics. World standard business schools will be established in Moscow and St. Petersburg, and two national universities will be founded in the Southern and Siberian Federal Districts. On the whole, the project sets down a number of measures to develop education infrastructure and social environment.

The Healthcare project is the most ambitious, and certainly the most expensive project in the sphere of medicine at this stage. Healthcare problems have never been a priority in Russia's state policy. In the next two years its implementation will require 145 billion rubles (over $5 billion), including 30 billion (over $1 billion) to raise salaries of general practitioners, nurses and ambulance doctors, and another 30 billion to update primary care diagnostics. In addition, 15 new regional medical centers will be built and the operating ones will be reequipped. Budget funds are being allocated for the purchase of 12,000 new ambulances.

The basic healthcare trends include the development of primary medical and sanitary care, the modernization of compulsory medical insurance, the improvement of preventive medicine and provision of high-tech healthcare.

The agriculture project is designed to raise living standards of rural residents and boost the productivity of private farms and farmers' economies. Agriculture Minister Aleksei Gordeyev said, "the key goal of the project is to improve living standards of urban and rural residents."

Another aim of the agriculture project is to develop cattle breeding and encourage small farms. According to the authors of the project, over the years of the reform the annual consumption of meat has fallen by one third to 53 kg per every Russian, while an average American eats 115 kg of meat a year. Despite insignificant support from the government, those involved in agricultural small businesses, including people who run their own farms, produce almost 50% of all meat, 80% of vegetables and 90% of potatoes. Gordeyev assumes that when the government makes the sphere a priority an impetus will be given to agricultural production at large.

A renewed housing project has enormous importance for the country. It is targeted at the entire population, and, once implemented, will make quality housing accessible to every Russian citizen. According to preliminary estimates, it is necessary to build over 90 million square meters of floor space annually just to keep housing availability at the present level, and some 200 million square meters of floor space a year to reach European housing provision standards.

Under the new project, up to 100 billion rubles ($3.5 billion) in state guarantees will be allocated annually to the Agency for Mortgage Credits and Direct Expenses, as compared to the current 20 billion rubles. In addition, there is a separate provision for the financing of communal infrastructure: 13 billion rubles from the federal budget will be invested next year.

Experts have long been saying that the country needs a serious national program that would combine housing, related infrastructure, land market development, the production of construction materials and mortgage. The current program is designed to achieve these goals. Yet, its implementation will meet with serious difficulties because there is no single project supervisor. A lot of structures - federal, regional and municipal on the one hand and banks, construction companies, real estate agencies and brokers on the other - will have to work together in close interaction.

Nevertheless, the government intends to provide Russians with affordable housing in the next few years. Regional Development Minister Vladimir Yakovlev recently said that lower mortgage rates of the Agency for Mortgage Credits were being currently discussed. The whole range of measures in the housing sphere is supposed to speed up the pace of construction from the current 40 million to 80 million square meters of housing by 2010.

The national programs are to be implemented in 2 to 5 years, and work is already underway. A salary increase for doctors, teachers and communal administrators is a top priority, and the first results will be seen in the first quarter of 2006.

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