[conclusion of Q&A]

Nikolai Levichev (A Just Russia): Mr Putin, I'd like to resume the discussion of the public education system which, in my view, is developing in a rather unbalanced manner. The ministry is making a lot of effort to develop assessment and gauging procedures, such as tests, reports and so on. A lot of money has been spent on the introduction of the Unified State Exam (USE) in recent years. According to expert estimates, the USE costs us an annual 6 billion roubles, which accounts for about 20% of secondary education spending. We believe this is over the top. A decision has now been made to introduce the USE for Bachelors, which means further costs. Is this feasible? The checks are becoming increasingly rigorous, yet the decline in the quality of education continues.

file photoWould you agree that we have chosen the wrong vector for the development of the national system of education and that our preoccupation with testing procedures undermines the efficiency of the learning process as such?

Thank you.

Vladimir Putin: I partly agree that testing procedures alone won't help us discover young talent. But there is also a system of academic contests and competitions of all kinds. And then again, major Russian universities, such as the Moscow State University, admit aspiring students on the basis of their in-house entrance interviews as well [as the standardised academic aptitude test results].

I agree that by focusing exclusively on such tools, we will end up in a high-risk zone. We'd do better to combine what I've just mentioned with the aspects that you find disconcerting.

By and large, though, I believe that we've taken the right course. Our aim is to make the education system more efficient and modern.

Speaking of the Bachelors, if we want our university graduates to feel confident on the international labour market, it would not hurt to embrace this system. It could also help us make the national education system more competitive. Every resident or non-resident entering a Russian university will then know that upon graduation, he or she will be qualified to work in any country in the world. This will raise the competitiveness [of our education system] and attract skilled personnel. This is crucial, in my view. So, on the whole, I think we are moving in the right direction.

Nikolai Kharitonov (CPRF): Mr Putin, what kind of philosophy, conditions and legislation do you think we need for the even and equal development of the Russian provinces? The Regional Development Ministry does try to nurture all the regions in equal measure, but it hasn't been particularly efficient in its efforts so far.

Vladimir Putin: Well, this is something we should think about all together. This is not an easy question. In recent years, we've disbursed almost half a trillion roubles in budget allocations for regional programmes. We are running seven regional programmes, one of which I mentioned earlier today. They target Russia's Far East, the Trans-Baikal region, the Chechen Republic, the South of Russia, the North Caucasus and the Kaliningrad Region. Seven programmes, I repeat, and we allocated half a trillion roubles on them. These programmes are quite efficient, by and large. But there is much more to be done, of course. The Regional Development Ministry needs to think of ways to organise its work in the years to come in a more efficient way. I agree with you here. We should concentrate our resources on key areas of regional development and build general rules of conduct on key issues, making the most of the assets of each particular region. That's how we will go about it.

If you have any concrete proposals on how work should be organised, we will be only too glad to consider them.

Yaroslav Nilov (LDPR): In your report you touched upon outside threats, Mr Putin. Our party would like to know where you stand on the following issue. It is no secret that NATO was set up as a rival military alliance [to oppose Russia and the Eastern bloc]. We cannot help but recall U.S. presidential candidate [Mitt] Romney's words about Russia being his country's principal foe.

The Russian government has always tried to prevent the deployment of any foreign military bases inside the country or near its borders. And our LDPR party has been working to prevent NATO's eastward expansion. But now NATO is reportedly set to deploy a military base in Russia's Ulyanovsk Region. So the question is: Has the government's position truly changed? Or have we just misinterpreted matters? Please comment on this. Thank you.

Vladimir Putin: I believe that NATO is a relic of the Cold War era. It emerged at a time when we still had a bipolar global system. NATO came along first and then the Warsaw Pact was established as a counterweight. Today, the situation is different. So I'm at a loss as to why we need an organisation such as NATO. But this is a geopolitical reality, and we have to reckon with it.

Admittedly, NATO sometimes plays a stabilising role in international conflicts these days. Though it may meddle in affairs beyond the scope of its mandate, and we should respond to such cases accordingly. This is only natural. But as I said, in some instances, its role is that of a stabilising force.

In Afghanistan, for instance, NATO is operating in line with the UN mandate. I'd like to address all those present here today, whatever their political convictions. We are all aware of what is going on in Afghanistan. And we would like the situation there to remain under control. Right? We wouldn't want our soldiers to fight on the Tajik-Afghan border, would we? So let NATO and other Western contingents do their job.

We've agreed to support air and overland transit of certain countries, including the United States, Germany and France. In my view, we must help them in their efforts to restore stability in Afghanistan. Otherwise we will have to do that ourselves. You see the kind of dilemma we're facing?

Speaking of NATO, we have already allowed the right of transit to certain NATO member states. But we should be very pragmatic about what we do, accepting things that are in line with our national interests and abstaining from those that run counter to them. Maintaining stability in Afghanistan is in our national interest and so we declare that we are willing to provide assistance with transit.

As for Ulyanovsk, the plan is to arrange a launching pad for freight transit as the military say, not a military base. Nothing that contradicts our interests is being done there. On the contrary, we stand to benefit.

Adalbi Shkhagoshev (United Russia): Mr Putin, I have two questions, both of them political. The first is related to the revival of direct gubernatorial polls with an "election filter." Despite the fact that we've approved today the idea in principle, many of us just don't know what to make of this filter. We've been wondering therefore how you see it personally, and whether you think it will be able to cope with two important tasks: a) supporting good candidates; and b) preventing politically weak candidates or ones with criminal records from taking power.

And my second question or, rather, request is to ask you to comment on the newly adopted amendments to the law on political parties, concerning registration or...

Vladimir Putin: Let's begin with your second question. Well, the law has been adopted, and we should abide by it. It's important that we prevent new parties from being set up on the basis of religious, ethnic or regional principles. Our federation is based on a complex structure. Such decisions can only be made after a serious analysis of potential consequences. We should pay close attention to how laws are applied in practice so as to prevent the emergence of parties on separatist or ultranationalist platforms. Our country is a multi-ethnic one, is it not? And our federal state is intricately organised. So I do understand your fears and share some of them.

On the other hand, though, we ought to be mindful of society's needs. The public should feel that it is they who form the government. Only then will we have a stable social life and a balance of political forces. In Sweden, for example, there are as many as 700 parties, despite the country being so small. Only 30 parties run for election, though, and the parliament is formed by six or seven parties. There are a great deal of parties in the United States as well, I even don't remember their exact number, but only two of them play on the nation's political scene.

People feel free, and they are given the opportunity to form political parties and participate in politics. But the system is built in such a way that it stabilises the state instead of splitting it. This is what we, too, should strive for. The country's political well-being and its future will largely depend on how we apply this law.

Speaking of gubernatorial elections, I was one of the people -- perhaps the only person -- behind the previous mechanism, which had to do with the president's appointment of nominees proposed by parties winning elections in their respective regions. It would have been hard for federal authorities to impose someone. Not that they sought to do so... When I was president, MPs of a regional legislature warned me that they would vote down the candidate I was going to nominate. It was in Volgograd or in Nizhny Novgorod, I think. And so I ended up proposing another nominee. In those days, I believed there was a high risk of criminal and ultranationalist forces getting into power in the regions, with the nation recovering from a civil war. So I thought this scheme would be appropriate for the circumstances we had at the time. It was mindful of the national as well as regional interests, with all governor nominees to be confirmed by regional legislatures.

When assessing an official's performance, we tend to concentrate on the failures and we overlook the achievements. And if an official is appointed, responsibility for all things negative is usually shifted toward the one who hired him or her. And in that particular case, it was the nation's president. But members of the public who vote by direct secret ballot should also feel responsible for those whom they bring into power. This is important from the point of view of internal democratic processes.

In this country, ultranationalism and separatism may prove to be in high demand on the election market today, and these tendencies do pose a threat to us, as you rightly pointed out. So we should proceed with caution.

How should we build those filters and what should they be like, you ask? I don't know, really. This is up to all of us to decide. I think they should be effective in sifting out candidates with extremist ultranationalist views or with criminal records. On the other hand, though, they should not function as an impediment to the process of voting. I'm with you here.

One of the options proposed in the bill that you mentioned involves a preliminary vote by MPs of municipal legislatures. Such a tool already exists. It has been employed in presidential elections in France, for example. If a person wants to run for governor, he or she will have to hold consultations with members of local legislatures first. At the end of the consultations, the lawmakers will rate that person (from 5 to 10%), for example. Such a mechanism seems quite workable.

But are any such filters possible or necessary at the federal level, in presidential elections, for example? Well, if we invent an appropriate mechanism, I will lobby for it, of course. But, as I said, it should be easy to comprehend and it should be transparent, so as to prevent the president from barring some candidate unjustifiably. And by no means should it be burdensome for voters. But for now this is a work in progress. So let's see how that piece of legislation works. We'll be able to amend it later on, if necessary. But first we should see it in action. But until it is signed into law, feel free to make proposals.

Mikhail Yemelyanov (A Just Russia): In your speech and while answering the question of deputy Khairulin, you spoke about the positive international experience of our WTO accession. But China, India, South Korea, Asian Pacific countries and other modern economies did not open themselves to the outside world until after they had modernised their economies. You said that almost 70% of our capital assets have depreciated. This means we're opening our economy to the world before bringing it up to date. This is a strategic error, in my view. How can we seriously speak of equal competition with foreign importers given that most domestic enterprises are likely to become unprofitable or even loss-generating upon Russia's accession to the WTO? Where will they get the money to modernise themselves? No one is likely to give them loans or invest in them. I've been wondering therefore which of the economic sectors stand to benefit from the country's WTO accession ­ not in the hazy medium term, but immediately? And which sectors may collapse or face recession as a result? I'm putting this question to you personally because officials directly involved with the WTO normally try to avoid giving concrete answers. Can you say something concrete about this? Have our prospects been analysed?

Thank you.

Vladimir Putin: You remember the joke about which came first, the chicken or the egg? The answer is: we had everything earlier. However, it is not correct, because there was a time we had neither chickens nor eggs in Russia. The poultry on offer at our shops was scarce, and it was of inferior quality. But in recent years ­ just to give you an idea ­ our poultry output has nearly tripled.

Remark: Are you referring to chicken imported from the U.S.?

Vladimir Putin: No, no, I'm talking about domestic produce which almost tripled. The production of pork has increased by a factor of 1.5, meanwhile. Meat consumption in Russia also continues to grow. In the Soviet era, the [per-capita] meat consumption rate never exceeded 67 kilogrammes per year.

Remark: 75.

Vladimir Putin: No, no, it's 72 currently. It was 67 before. Now 72 is the best indicator.

You were wondering whether it would not have been better to modernise first and join the WTO afterwards. Many experts, an overwhelming majority of experts believe that we won't be able to modernise our economy without joining the WTO. That is the whole point. And, frankly, I would never have agreed to our WTO accession had I not agreed with that viewpoint after very prolonged discussions.

You see, the fact of life is, as we say, "a man doesn't cross himself until he hears the thunderbolt." It's the same in this case: until there is an awareness of real competition, there will be no investment in modernisation. I have already mentioned that during the crisis the amount of new equipment at our enterprises increased by 10%. Why? The crisis forced them to do this, they simply had to do it, especially, for example, in the power industry and in the chemical industry. It's the same case here.

When an enterprise has to modernise it springs into action. If the market is closed and your wares are being purchased anyway, you are not too keen to modernise. And they turned the issue around. Shut down imports. But there is no way imports can be shut down, they carry on growing all the same.

You know how it happens: as soon as real incomes increase ever so slightly, imports increase many times over. Why does this happen? Because our economy and our industry do not meet the modern standards in terms of quality and price. To finish my answer to your question I would like to say that I am concerned about this as well, but I still hope that increased competition will spur the modernisation of our economy. There are some key issues, as I have mentioned ­ agriculture, the automobile industry, production of agricultural equipment and technology. Of course I agree with you that there are some questions, but we should actively look for instruments to protect them over a certain period of time using WTO instruments (which is what we are currently engaged in). These instruments exist. I have already mentioned those in the automobile industry. And instruments can be found for other sectors, for agriculture and so on.

Sergei Naryshkin (State Duma Speaker): Thank you. Colleagues, all the questions have been asked, and answers have been given. Deputy Oleg Nilov has suggested that questions could be asked in written form, and we had an opportunity to do so.

Vladimir Putin: I suggest the following. If there are any additional questions that you want to ask, that you consider to be important, let us have one more question from each party. Yes, please.

Vladimir Bortko (CPRF): Mr Putin, forgive me for asking you a political question that is not just in your capacity as Prime Minister, but also as the future President.

Considering the aim of expanding democracy, what would you say about the Duma striking out from the draft the words "two successive presidential terms"? That is number one.

Extending presidential powers, would you take offense if we introduced such a proposition in order to define you not as a representative of the legislative branch but of the executive branch, and, pardon me, to strip you of the right to initiate legislation, just in order to indicate that you are the representative of the legislative branch? And the last question. What would you say if we introduced an initiative to change the preamble to the Constitution to say that we are not a multinational people, as it currently reads, but that we are the Russian people and the peoples who have joined them?

Vladimir Putin: First, regarding the removal of the words "two successive terms" from the Constitution and leaving only the words "two terms" -- I think this makes sense, we might think about it. We should consider this along with all the parliamentary parties.

I'll be quite frank with you and not only because it affects me to a lesser degree, as you understand (let us be true, we understand what we are talking about, we're all grown-ups here). The law cannot be applied retroactively, from the moment it is passed I will have an opportunity to serve now and for another term, no problems there, but only if the situation permits it and if I want it.

You see, there comes a moment in the life of every person, and I assure you that it has occurred in my life, when there is no longer a need to cling to something, and a person can and must think about the destiny of the country.

I agree with you that we should constantly think about improving our political system in such a way that will make it stable, reliable, efficient and flexible in terms of reacting to the processes taking place within and outside the country. Let's think about it together. Actually, to me, this is an overarching task, the overarching task of all my work and probably my life. So I do not rule out discussing any options. That's number one.

Number two. Regarding the right to initiate legislation. Why should the president be stripped of such a right? I am not talking about myself, I mean in general.

Vladimir Bortko: He is a symbol.

Vladimir Putin: A symbol? And who is going to work? If the President is a working entity he must have an opportunity to submit his proposals on improving the legal framework to society, to parliament. I think that would be wrong. I cannot go along with that.

Furthermore, as for replacing "multinational people" with "the Russian people and other peoples who have joined them." Do you know what would happen? Part of our society would become first-rate people and another part would become second-rate people. That cannot be done. We want to be a single strong nation, a single people, so that every person who lives in this country feels that this is his homeland and that there is and cannot be any other homeland. For every person to feel that way we must all be equal. That is a fundamental issue. There is no doubt that the Russian people form the backbone, the foundation, the cement of the multinational people of Russia.

And you know, I can well afford to say this, I have already said in public that they have dug up some church documents dating back to 1600 or thereabouts, and all my ancestors have lived in the same village 120 or 180 km from Moscow and for more than 300 years they went to the same church. I feel it in my gut, I feel a gut connection with this country and its people.

But dividing people into first, second and third categories, you know, that is a very dangerous path. We shouldn't do it.

Leonid Slutsky (LDPR): Mr Putin, we are one country, we have a single foreign policy and I think my colleagues from all the other parties will agree with me if I say that for us the moment of truth is whether the Eurasian Economic Union will be created in 2015 and whether it will, within a short span of time, once again emerge as a pole in world politics and international relations.

Today we are working hard, I can say this as chairman of the Committee for CIS Affairs, in order to envision the parliamentary dimension of the future Eurasian Union. But we still have many hangovers and rudiments, as you said with regard to NATO, of our shared recent history with the near abroad countries, the recent history when work in the CIS space, to put it diplomatically, was put on the back burner.

That brings me to my question or proposal: over the next few months ­ the time when we will adopt the 2013 budget is not far away ­ we should bring in representatives of the Committee for CIS Affairs jointly with the leadership of Rossotrudnichestvo and discuss the remnants from the past that we still have concerning the programme of relocation, the International Development Agency and some other outstanding issues. In this way, all the masses of our fellow countrymen and citizens in the Eurasian space would support us, the Eurasian Union. All these issues must be discussed and synchronised, and certain decisions should be made in the Russian Federation within the next few months. I would like to ask for your support on this.

Vladimir Putin: I agree with you. I have nothing against it, indeed, we will support it. Moreover, I believe that deepening integration in the post-Soviet space is the key task of the economy and Russian foreign policy, it is absolutely the key task, there is no more important task. Our future depends on it.

Still, as for the question raised by Vladimir Bortko, we should make our country a magnet that will attract other peoples to join us -- if for example some former republics of the Soviet Union that stayed out of the deep integration processes, give a second thought to what they stand to gain from it, such that nobody in these countries could say, "why should we join them if they have no equality within their country?"

You see, this is a very important structural matter. I think that all these integration processes that have been launched and are yielding real results must be and will be our priority. But I cannot agree with you that these issues were put on the back burner in previous years.

If these issues had been neglected, we would not have had the Customs Union or the Common Economic Space.

Andrei Isayev (United Russia): Mr Putin, I think it is very important that the social theme had a substantial presence in your report today and that you have spoken about social guarantees. This means that the huge number of TV viewers who were watching this have been infused with a sense of confidence in tomorrow (that was probably the best thing in the Soviet times). But I would also like to say that you have touched upon an issue that is very important for us, and that is raising the minimum wage to the level of the subsistence minimum.

I remember that when you started as Prime Minister you insisted on such a decision being made in 2008. You are raising this topic again now. It has been growing slowly during the crisis period. You also said that the minimum wage should be increased little by little over the course of several years and that it should be brought up to modern standards. What are your thoughts on this?

Vladimir Putin: This is a very sensitive topic. I would not like to go into this discussion now.

The minimum wage must be raised, we must think about how we calculate the subsistence minimum. You know that many countries proceed based on hourly pay. Even if we adopt that approach some day we must work out mechanisms that would prevent a decrease in the incomes of our people whose pay is modest as it is. Conversely, we should map out a path that will lead to an increase in these wages.

We will have to discuss this in the government and at the presidential level (the Presidential Administration has a relevant directorate), and of course, the trade unions must take part. There should be a broad discussion in parliament. That is a very sensitive area. It is not enough simply to adopt an hourly measure of pay and say that we will proceed from it in calculating the subsistence minimum and the living standard. We should be quite clear on what this will lead to in practice.

That is why I touched upon this topic in my report but did not elaborate on it, because before saying anything specific we should immerse ourselves in this problem at the expert level and understand the consequences of each of our moves. But there is no doubt that these social policy instruments must be modern and must reflect current realities. I suggest that we think about this together.

Alexei Mitrofanov (A Just Russia): Mr Putin,

Private security firms have been springing up in the world in recent years. The Americans spend almost $350 billion providing these services. Private security firms protect foreign property and train foreign personnel, they guard infrastructure facilities and deliver a huge amount of services in Iraq and in other countries. Don't you think that we too should be represented in this business because we understand that this is a certain lever of influence? Would you be prepared to set up a working group to study this issue?

Clearly, this issue falls under the President's jurisdiction only, because it involves companies that have weapons, and not just small arms. So, it is a serious matter.

Vladimir Putin: I understand your question.

I think that it is indeed an instrument for promoting national interests without direct participation of the state. You are absolutely right. I believe we could give some thought to it.

As for using such institutions inside the country, that practice is already developing, but this is called outsourcing. You know, it is very expensive, it may be worth it in some cases. The Defence Ministry is introducing it. Honestly, I try to restrain them a little bit because it is just too expensive and calls for major budgetary outlays. But on the whole it's moving in the right direction, because then servicemen are relieved of various economic chores and will pay more attention to combat training.

This has to do not only with economic functions, but also with guarding facilities, weaponry and so on.

Yes, I agree with you, we can and must think about how to implement these plans.

* * *

Vladimir Putin's concluding remarks:

Esteemed colleagues,

I have expressed my views in some detail when answering your questions and I think I have made my position clear on some key issues of the development of our country. What can I say in addition in response to the remarks our colleagues have made from this platform?

I was handed a note from the KPRF suggesting that Rosstat (the Federal Service for State Statistics) should report directly to the prime minister or even to the president. This is an idea worth considering. As you know, executive bodies are more interested than anyone in the objectivity of these figures, otherwise it's impossible to plan anything. So, let's look into this proposal, I have nothing against it. On the contrary, perhaps this is the best thing to do. I am not ready to give you a direct answer at this point as to whether or not we will do it, but we will certainly discuss it very seriously. I think there is logic to this.

Now specific comments on the remarks that our colleagues have made.

Gennady Zyuganov said that there are many serious system-wide problems in European countries and in other parts of the world and that things are unlikely to be better here than they are over there. But we are already doing better than they are, this is evident. I have said that unemployment in Spain stands at 25%, as you know. Not so in our country... Yes, I am aware that there are many unemployed people here, but it's not one in every four people, like in Spain. I am sure you are aware of this.

You know, some things have to be taken as they are, without politicising them and without any wishful thinking. Do you want to see the same rate of unemployment here as in Spain? Surely not. You are in favour of full employment. We should put our heads together to think how to achieve this.

Or take GDP growth, industrial output. I reported the objective data to you ­ we have a growth rate of 4.3%, the third fastest in the world. Is this better than over there? It is better than in many countries. Among developed economies only Germany has a higher industrial output growth, and not much higher at that. Is this better than it is in many other countries? Yes, it is.

It is for this reason that we can aspire for more, that is the message I want to get across. We should do away with our ingrained attitude that things are better elsewhere and that they can never be better here than they are over there. They can. And we are achieving these results.

While on the subject of energy. I agree, it is absolutely true that unless we introduce new capacities we will not meet the targets set for the country's economy. That much is true. I have cited the figures. We launched 12.5 GW in the past few years and we are set to launch 8 GW during this year alone. Does this not mean that we are moving forward? Of course, we are.

Regarding Lenin's New Economic Policy (NEP). Make no mistake, I am not going to make any political assessments, but when it became clear that the planned economy was not working, Lenin introduced elements of a market economy. This is what he did. So, it is wrong to say that everything about the market economy is bad. Even the Communist Party introduced elements of market regulation when other approaches failed. It was only later that Stalin liquidated all these market instruments. Of course, this made it possible to concentrate resources. I will speak about this in a moment when I respond to the remarks of our other colleagues.

As you know, the advantage of a planned economy is that it makes it possible to concentrate the resources of the state in the most important, critical areas of the national agenda, for example, on defence and security, but in general it is less efficient than a market economy.

History has staged two experiments that are very well known in the world: East Germany and West Germany, North Korea and South Korea. These things are obvious. But that does not mean that everything about the market economy is fine. If we introduce a so-called "savage" capitalism, no good will come of it. So, what is our goal? A market economy, but one that is socially oriented. We will all work together to seek the golden mean in our practical work.

As for our dependence on energy resources, that is also something that we inherited from the Soviet era. This is an obvious fact. The same is true of the aviation industry. Of course, we are proud of our aviation industry. Didn't I speak about this? I think I spoke about it last year. But our aircraft are not up to standard in terms of noise and fuel consumption...

Clearly, investments must be made, but only investing public money is not effective. You know what is happening there.

And of course, in the 1990s, the previous parliaments made so many decisions concerning the privatisation of key sectors that it took us several years to pool all of our resources, several years of strenuous efforts and day-to-day practical work. It was impossible to pool all these resources. Was it me who made all these decisions? No.

We are talking about serious matters there. And I agree with our left-wing opposition that there are sectors in which the state should work and should be directly involved. Because, for example, in the aviation industry, there are no more than two or three competitors in the world, and they all operate with state support. That is an obvious fact.

Are we proceeding any differently? We are doing exactly the same thing. Why did we create an aviation holding? We are doing exactly that, and we are doing it directly. And as for ship-building, what are we doing there?

I agree. But you know, we spoke about our WTO accession, to be followed by modernisation. But that was not how it actually played out. Of course, South Korea, for example, passed laws in support of ship-building in 1962, including direct injections of cash by the state. They did this and later phased out these subsidies and put the industry on a market basis. Listen, that is precisely what we are doing in creating major holding companies, including under the auspices of the Russian Technologies State Corporation. All these things take time if we want to operate within the law, but we are moving in that direction.

Again, like I said before, we do this not in order to nationalise these sectors and maintain a state presence there forever, but to get them on their feet, to make them competitive within the country and on the international arena and to have the state gradually withdraw from these instruments, but doing so in such a way as to be able to influence these sectors and support them. This will be our tactic. I believe it is reasonable and highly balanced.

As for the fact that our budget revenues depend on the growth of energy prices ­ listen, that is how it should be. As soon as world energy prices grow our budget revenue grows, this is an objective factor. Are we supposed to not take this money? It is coming right to us.

Unfortunately, this is taking place too slowly (and in this respect I am in agreement with Gennady Zyuganov), but still diversification is taking place. A larger share of last year's additional revenues came from the manufacturing industry. And what is important, and what I would like to draw your attention to because you will be working on the budget, is that in the medium term we are planning for the share of oil and gas revenues to diminish and for the share of revenue from the manufacturing industries to increase.

Food imports. Vladimir Zhirinovsky has turned in his proposals. They are interesting. I will not go into them now. But there are indeed many useful ideas. We will try to take your proposals into account.

Mr Zhironovsky, colleagues from other parliamentary parties, unfortunately, we cannot abruptly cut food imports, much as I would like to do so. We all know why. Prices will skyrocket. We are trying to steer our way between Scylla and Charybdis.

As I said, in recent years we have increased poultry meat production by almost three times. Three years ago we imported 1.6 million tonnes of poultry meat. Last year we set a quota of 300,000 tonnes but wound up importing even less.

Is Viktor Zubkov here? How much poultry meat did we import last year? About 250,000, yes? Yes, about 200,000 tons of poultry meat. Just recently we were importing 1.6 million tonnes and last year this figure was just 200,000 tonnes.

But we cannot afford to stop imports altogether. And not because we care about foreign producers but because we must think about food prices in big cities.

Do we have problems there? Yes, we do. It has to do with cattle and beef.

By the way, we increased pork production by almost 50%. But pork is a real problem in connection with our WTO accession. We are thinking about how to support our domestic pork producers.

As for cattle. Unfortunately, last year there was a dip in production, not a big dip, but it happened. We are looking into the reasons why, and we will support major investment projects in the livestock industry.

In Central Russia alone we have several projects under way, one of which has to do with cattle and beef production and it is worth almost a billion dollars, about 30 billion roubles. I know that KPRF, LDPR and A Just Russia, not to mention United Russia, have specialists in the field of agriculture.

Can you think of just one European project on a comparable scale? No, because there are no such projects. Their agriculture is going downhill, or at least is stagnating. By contrast our agriculture is becoming more and more attractive for investments. This is not the only such project, we are thinking about ways to support other similar projects. And I am not talking about some other areas.

We are planning to bring in 5 million hectares of new lands to use in the near future. Such farms and projects will contribute to the development of agricultural lands. The enterprise I mentioned will develop 200,000 hectares, and that's just one enterprise. So, we will of course move in that direction.

And let's face it, you spoke about piggybacking on the achievements of the Soviet period, but beef production was not one of these achievements.

(Voice from the floor)

I am speaking the truth, and you ought to know it since you are engaged in this area because we did not have a livestock industry in the Soviet Union ­ listen to me and you will surely know about it.

(Voice from the floor)

There was no beef production in the Orenburg Region or anywhere else in Russia.

I have been engaged with this subject for many years and I listen to our agricultural producers very, very attentively. Go visit them and talk with them. Talk with Mr Zubkov, who has been engaged in agricultural matters since his young days. He was the manager of a state-owned farm and a collective farm, and unlike many of those present, he restored ruined farms and he knows about how to do this work. I meet with him almost every week, almost every week.

The Soviet Union did not have a beef industry. We simply slaughtered cows when they stopped producing milk...

(Voice from the floor)

We are not talking about the cattle population. In the Soviet Union we always had a lot of heads of cattle and not enough meat. That was the problem.

I'm sure you remember the commuter trains. There was a joke at the time: What's long, green and smells of sausage? A commuter train from Moscow. We all know it, what is there to discuss?

I don't want to enter into an ideological argument with you. This is not about ideology. The point is that we must get our economy to function efficiently. This is the point.

We did not have a livestock industry in the proper sense of the word. Today we engage in selection breeding and import cattle from abroad. It is very painstaking work that has a long cycle ­ about 8-10 years. You surely know this. We will solve that problem just as we are solving it for poultry meat and pork...

(Voice from the floor)

No, they say many things that are right, but they are saying it for the sake of argument. It is true that the cattle population was large, but the amount of meat that every cow yielded was miniscule, that was the problem. Because it was a population that produced milk and could not produce meat.

Milk is another problem in the livestock industry. Last year our milk output dropped slightly. Part of the reason has to do with the big subsidies that agriculture receives in other countries. That is true. Now we have agreed with our Belarusian partners within the Common Economic Space that we will even out these subsidies. As for milk, the gist of the problem lies in the procurement prices and the level of subsidies. We will try to set these things right.

These are obvious issues, believe me. I would hate to get into an argument, but this is true. There is nothing wrong about it, that is the way agriculture is structured. We have lived with shortages and this is a fact that everybody is aware of. The time has come to change the situation. There is nothing wrong or shameful about it. I am not going to blame anyone.

Regarding speeches to the military. We should not drag the Armed Forces into political struggles, but it would be a good idea for the heads of parliamentary parties to address cadets at the General Staff Academy, for example. I think it would be reasonable, and people would be interested, though I urge you to steer clear of polemics and politicking. But it is important for our military and for our cadets at the General Staff Academy to meet you in person, to listen to you and to be able to ask questions. I think there is nothing wrong about that.

Regarding the barrier-free environment and the housing and utilities sector. As you know, this is one of our biggest problems. You are right, we have a lot of problems, a whole host of problems. I have already said this, and I would like to say it again. There are things for us to be proud of, but we also have very many problems.

The main problem has to do with the need to raise the incomes of our people. That is the pivotal task. The entire mood of society depends on it.

Regarding the Astrakhan elections. I see that Sergei Mironov has left. What can I say? Why refer to this as a provocation? They are doing their job. These are elements of political struggle. I can understand this. But it is not within the competence of the prime minister or the president to assess the results of elections or to cancel them, especially at the municipal level. So, we should all remain within the current legislation. We must respect each other, listen to and hear the minority both inside and outside of parliament, and draw conclusions. But the minority must respect the choice of the majority. What are the procedures? Perhaps they need to be improved. Let us think about it together.

What would I like to say in conclusion?

We all need to upgrade our political culture, we should not take things to a personal level here in this room or in our polemics in general. This is very important.

Secondly, with regard to ethnic issues. I would like to urge you not to speculate on ethnic problems, this is a very sensitive topic in our country. I am calling on everyone ­ representatives of United Russia, A Just Russia, the Communist Party and LDPR.

You know, there is no doubt that the Russian people, I mean ethnic Russians, form the backbone of our society and state. But if we permit ourselves in the course of some political debates and internal processes to try to profit from the ethnic theme, we may shake the internal unity of Russian society and ultimately the Russian people will suffer because we will be destroying our country and our Federation.

I would like to thank you for today's meeting and I look forward to working alongside you.

Thank you very much.

Keywords: Russia, Government, Politics - Russian News - Russia