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TRANSCRIPT: Putin Q&A Session "A Conversation with Vladimir Putin"

Vladimir PutinTelevision channels Rossiya and Rossiya 24 and radio stations Mayak and Vesti FM have started broadcasting the annual Q&A session, "A Conversation with Vladimir Putin, Continued"

The Prime Minister answered numerous questions on pressing social and political issues raised by people during the programme.

Transcript of A Conversation with Vladimir Putin: Continued:

Maria Sittel: Good afternoon. I am Maria Sittel. We are live on air with the special programme A Conversation with Vladimir Putin: Continued.

I would like to start by thanking all our viewers and people across Russia for calling in and putting their questions to the prime minister. We have received a great many of them, and it's clear that Russians want to hear first-hand about what the government is doing and about its plans.

Today's conversation will look back over 2010. Each of us will also do the same. Some will never be able to forget the wildfires that raged throughout Central Russia or the unprecedented drought that struck the Volga and Urals federal districts. Others will remember this year as the year their child was born, as the time when housing conditions improved thanks to maternity capital payments, when they bought a car under the car scrappage programme or for many other reasons.

As this year recedes into history, we remember the bitterness of defeat at the 2010 Winter Olympics in Vancouver, the Paralympic athletes who gave us so much to cheer about and our jubilation after Russia won the bid to host the 2018 FIFA World Cup.

Ernest Mackevicius: That's why we have invited fire-fighters, rescue workers, academics and people who worked to rebuild burnt-out villages here today. Doctors, students, industrial workers, farmers, representatives of public organisations and many others are also here with us. Every single one of them will have their own impressions of the outgoing year.

I am Ernest Mackevicius. My colleagues, Maria Morgun, Tatiana Remezova and Maria Kitayeva are all working with Maria Sittel and me to bring this programme to you.

Maria Sittel: Mobile television stations will be broadcasting live today, linking us live with various Russian regions. We will have live broadcasts from Astrakhan, Novokuznetsk and Cheboksary. We will also be in touch with our crews on location.

Ernest Mackevicius: So here at Channel Russia we are now going live to Prime Minister Vladimir Putin. (Applause).

Maria Sittel: And I'll be here, at the call centre throughout the programme. These operators have already been working round the clock for over three days. You can continue to call in with your questions for the duration of broadcast.

Ernest Mackevicius: Good afternoon, Mr Putin.

Vladimir Putin: Good afternoon everybody.

Ernest Mackevicius: This is the third time we've been forced to start this conversation with the word "crisis." Yes we're starting to see some evidence of recovery. On the one hand, our industry, including the automotive sector, is on the rise. Crude oil now costs almost $90 a barrel. The rouble is strong and stable. At the same time, the budget deficit remains, prices are rising, medicine and food are becoming more expensive, and utilities bills are increasing. When will the fact that the worst is over be felt by ordinary people, not just the economy?

Vladimir Putin: So the suggestion is that we sum up the results of the outgoing year?

Ernest Mackevicius: Yes, that too.

Vladimir Putin: And we should certainly do it according to tradition. I have the very latest information here. Talking with my colleagues yesterday evening, I mentioned that point, the statistics indicate it's the case and the ministries have confirmed it.

Last year it was rather difficult to talk about results. The main indicator of a country's economic effectiveness is growth or decline in the gross domestic product, which indicates the scale of our entire economy. We have seen solid growth of 5%, 6% or even 7% on average over the past decade. This has been very good, stable growth.

But last year our economy shrank dramatically because of the global financial and economic crisis; it shrank even more than that of some other countries, by 7.9%. This year we saw a positive trend: the economy grew by about 4%, or to be precise, by about 3.8%. This is less than China, but more than Europe or the United States. This is the main, the fundamental indicator, and it is positive.

Second, industrial production decreased considerably last year, by over 9%, by 9.8%. This year it rose by over 8%. This does not make up for last year's fall, but is moving in that direction, with industrial growth in the region of 8.6% or 8.5%.

Agriculture also saw a minor increase last year, by about 1.4%. But this year, as we are all well aware, because of the drought, we will see a fall of 9.9%. Because the harvest failed. We harvested 108 million tons of grain in 2008, 98 million last year and 60.5 million tons this year and this is a considerable decrease. This is all down to the drought.

However, and this is something we'll touch on later, we are working intensively to support agriculture and to preserve this trend of positive development. I am confident that we will succeed.

On the negative side, nothing was invested in fixed assets last year, but this year such investment has been growing.

What effect has all this had on social issues?

Although real wages (minus inflation) fell by 3.5% last year, people's real incomes grew a little, by slightly over 2%. Where did that come from? It resulted from the decision we took regarding public sector wages in December 2008, when we increased the wage fund and also raised pensions by over 24%. People's real incomes increased by a little over 2%. But this year we saw real wage growth. They fell by 3.5% last year but grew by 4.2% this year.

People's real incomes have grown accordingly, also because pensions were raised substantially, by 24% last year, which is considerable growth, and by 44.9% this year. Pensions have grown by nearly 45%, from 5,333 roubles to 7,800 roubles and higher. This may not be anything to write home about, it's no great windfall but still, it's something. We no longer have pensioners living in poverty on incomes are below the poverty line.

A few words about the poverty line. The proportion of Russians living below the poverty line has decreased from 13.1% last year to 12.5% this year. Is that a lot? I would say that this is a positive change.

I'd like to remind you that 29% of people in Russia, or about 45 million, were living below the poverty line in the year 2000. How does this compare to Europe? We have grown used to comparing everything to Europe. It's more than in Europe. But this is very strange approach to statistics, as the average data for Europe is not available even to me, and the data for developed market economies differs from information about East European countries. The situation in Russia is not all that different from that in, say, Romania or Latvia, and it may be even better, given the drastic consequences of the crisis in some East European countries.

Overall, we are finishing this year in a quite satisfactory manner.

Ernest Mackevicius: When will we see a return to the pre-crisis standard or quality of life?

Vladimir Putin: You mean when will the general public feel that the situation is indeed improving? I think a positive trend is underway and that people should be able to feel that.

You see, last year we had 6.2 million unemployed people, but this year we have cut unemployment by 1.2 million people by creating new or restoring old jobs. Believe me, this is a very good indication, rather more than merely satisfactory.

I hope that people have least sensed that changes are underway.

As for the country as a whole, I started with the most important indicator, GDP, gross domestic product growth, as it gives a clear indication of the size of our economy, when the economy surges back to pre-crisis levels, the levels that existed before 2008, then we will be able to talk about people feeling this change in their salaries and in the reviving jobs market.

A variety of experts hold that we are set to regain our pre-crisis GDP level in late 2012, although some believe it will happen by late 2011. I think the truth lies somewhere in-between: we should be back at pre-crisis levels by mid 2012.

Ernest Mackevicius: So, it would be premature to expect to see the turning point in 2011?

Vladimir Putin: As I see it, we are already at that turning point. Look, our GDP fell by 7.9%, but this year it has grown by 3.4%. So, overall, the trend can be described as a watershed and our task now is to keep it up.

Ernest Mackevicius: Mr Putin, this year was a trying period not only for the economy, this year will be over in two weeks' time, but also because of the natural and man-made disasters. Which would you class as the difficult?

Vladimir Putin: The wildfires, of course. I felt terribly sorry for people, for all those for whom this really was a major catastrophe. People in those small villages, who lived as they always have, quite modestly. They lost even that little that they owned, and this really was a great trial both for those people and for the country, for all our regional and federal authorities. On the whole, we dealt with these problems.

And of course it goes without saying that the drought was a heavy blow to the economy.

Ernest Mackevicius: Our call centre is now taking the first live calls, and we have also been getting a lot of text messages. Over now to Maria Sittel, who is in our call centre monitoring the calls and messages that are coming in.

Maria Sittel: Thank you, Ernest.

Mr Putin, the country has been stirred by the recent unrest in Moscow and St Petersburg. Thousands of people wreaked havoc, beat up passers-by and chanted nationalist slogans practically next to the Kremlin walls (in Moscow) and the Winter Palace (in St Petersburg).

We have received thousands of messages on this question. Some say that the violence perpetrated by people from the North Caucasus must be stopped, while others ­ these are people of a wide range of different nationalities and ethnicities ­ demand that a definite end be put to the actions of those nationalist groups.

Here is a message from Erach Makhmadilayev, who lives in Orekhovo-Zuyevo in Moscow's suburbs: "As a result of this unrest, people of my nationality cannot leave their homes to go to work. The police are not doing anything. I am asking the authorities to intervene."

And here is another message on the same issue, from Andrei in Krasnoyarsk: "Do you think it was the government's leniency regarding people from the North Caucasus that sparked this aggression in Russians?"

Vladimir Putin: Actually, we must cut short extremist actions on all sides, no matter where their origins lie. And we must not tar everyone from the North Caucasus or indeed any other nationalities, in fact anyone at all, with the same brush. But we must be ruthless in cracking down on all extremist actions.

The general public, including the liberal section of society, has to understand this, and I think that everyone would agree that we need law and order and that it must be upheld. One of the government's functions is to guarantee the interests of the majority. This is the first point.

Second, we often, justifiably, criticise our law-enforcement agencies. It's no accident that we have major reform plans in this sphere.

But while fighting negative elements in our law-enforcement agencies, including the police, we must not tar everyone with the same brush. We need to understand that these agencies are entrusted with a vital state function and we must not treat them like dirt; otherwise our liberal intelligentsia will have to shave off their beards, don their helmets and go out onto the streets and squares to fight the radicals.

I think this would be the absolute worst-case scenario, because everyone has their role to play, their job to do: for some this is operating TV cameras, for others it's holding the microphone, while others go out onto the streets to fight the radicals. However, the state must certainly fulfil its functions in strict compliance with the laws that are in force.

Maria Sittel: Mr Putin we have received another related question by SMS: What about the Russians living in the North Caucasus? What will happen to them after the events in Moscow?

Vladimir Putin: I think we should cast away all fears. People from any Russian region, be it the Caucasus, the Far East, Siberia or Central Russia, should feel at home in their country wherever they live. Regional authorities must play a key role here, and public organisations, too.

What's important is that all Russian people, all Russian citizens of any ethnicity or religion identify themselves as part of a single nation.

To make sure people feel at home everywhere in Russia, we must all behave appropriately, so that a person from the Caucasus feels safe walking around Moscow, and Russians of Slavic ethnicity feel safe living in the North Caucasus. People of all ages must have a shared awareness that they have one homeland. One of our main objectives here is to ensure that all people can live and feel safe and comfortable everywhere in the country.

I must reiterate what I have said on multiple occasions: Russia has originated as a multi-ethnic and multi-confessional country.

Our religion is Eastern Christianity, or Orthodox Christianity. Some theorists argue that it is in fact even closer to the principles of Islam than to Catholicism. I would not like to assess how close this statement is to reality, but it is certainly true that these religions have coexisted for centuries. They have developed a communication culture over these centuries ­ not over the past few decades. We must look back to those centuries.

Ernest Mackevicius: Mr Putin, you must have seen our previews of today's Q&A sessions, in which we showed the footage of yourself visiting the villages devastated by last summer's wildfires, in Altai and Central Russia. You said new houses will be in place by winter. You have made good on your promise, and all the fire victims have moved into their new homes and have thrown housewarming parties.

We would like to ask those people and our correspondent, Dmitry Kaistro, how things are going for them now.

We link up to Ivatino, in the Vladimir Region. Hello Dmitry, what does the village look like today, and who have you met there?

Dmitry Kaistro: Good afternoon, Mr Putin. Ernest, Maria, hello.

We are here in the village of Ivatino, where 68 modern comfortable houses have been built literally from the ground up in almost no time. This is essentially a new village constructed for the local residents who lost their homes to the wildfires last summer.

These new houses have all the modern amenities, such as household gas, satellite TV, the Internet and so on. The local residents remember your visit with deep appreciation, Mr Putin. You were here in autumn, when the construction was still underway, and it was due to the decisions you made that the people were able to move into their new homes before the cold weather and snow have set in.

These people are preparing for the holiday season. They have met me today to tell you about the changes in their lives over this time and to ask you questions.

Who wants to go first? Who has a question? Go ahead.

V.Yuzhakov: Mr Putin, here is my question. It's been five months since the fires. Will any amendments be made to the Forest Code? Will anything change? I mean, four years ago, woodlands were leased out to businesses and all forest keepers and wardens were made redundant. Will they be reinstituted? The situation with the forests is completely out of control.

Vladimir Putin: We have indeed decided to make changes to the Forest Code and toughen the tenants' responsibility for the areas they lease. But that is not all. This is only part of a bigger problem, which mainly stems from the fact that fire services are very poorly equipped. We must also make amendments to legislation to expand safety areas in forests, especially around villages and strategic facilities. The State Duma is currently debating a bill on volunteer firefighting brigades, which existed in the Soviet era. We are planning to reinstitute them.

As for the fire services, we are planning to retool them: to provide them with aircraft, which currently belongs to the Emergencies Ministry as well as the Defence Ministry and the Interior Ministry, and with other fire-fighting equipment.

The government plans to allocate 43 billion roubles to purchase the equipment over the next few years. New aircraft will be acquired, eight Be-200 jets as far as I know.

All that, taken together, will hopefully enable us to deal more confidently and efficiently with challenges on this scale.

Ernest Mackevicius: Dmitry, let's have another question from Ivatino. Please go ahead.

Dmitry Kaistro: Does anyone have another question?

Yelena Kulakova: I'm a paramedic and work closely with the population. Elderly women say that where they used to live their utilities bills were not as high as they are now. Are any changes in utilities bills planned for next year? Will they increase or stay the same?

Vladimir Putin: Ms Kulakova, my understanding is that those communities used to have only low-capacity power-transmission lines. They are now connected to the gas system, benefit from decent power supply, water and sewage systems, as well as TV networks boasting over 100 channels. Virtually every single house has broadband internet access. The upkeep and maintenance of all this infrastructure, of course, requires additional resources.

At the same time, and I think this is something you can confirm, I would like to note that the homes were all built using new technology. They are energy-saving in the direct sense of the word, which helps keep the cost of electricity and heating down. This is the first point.

Second, most importantly, this concerns not only rebuilt communities but the entire country's utilities infrastructure. Naturally, people are not satisfied with what is happening here, and I'm sure we will return to this issue during our discussion today. In 2008, utilities prices rose by about 20%. Despite an uptick in early 2010, we succeeded in restraining the price rise to about 15% nationwide. Next year, we do not expect these prices to rise by anything over 13%. I repeat this is the projected nationwide average.

And if you economise, you can make savings. Of course you now benefit from the added convenience and comfort provided by this new infrastructure, and that has to be paid for.

True, I don't know, it's one thing to use coal and firewood, and natural gas is something else. I'm not convinced that gas is always more expensive. For example it's much cheaper than diesel fuel. People in areas which previously had diesel-fuel boilers will be able to spend less.

Ernest Mackevicius: Mr Putin, let's get some thoughts from our studio audience on this.

Tatiana Remezova, please go ahead.

Tatiana Remezova: Thank you, Ernest.

There are people from the Tambov Region here in this studio. That region was also hit by this summer's wildfires. It would be interesting to get a reaction from people there to our report from Ivatino.

A. Lapin: Good afternoon, Mr Putin.

Russia was hit by an abnormal heat wave this summer. Forests and villages burnt. Surely, it is very good that you built homes for wildfire survivors so quickly and that you personally supervised housing construction on all these sites. But what can we do about those "dying" villages which lack adequate living and working conditions?

Ernest Mackevicius: And running on from that, Mr Putin, can we add the following "awkward" question which really is on everyone's mind? It was sent in by Lyudmila Mikheyeva from the Kemerovo Region.

Vladimir Putin: As if we haven't already had some "awkward" questions.

Ernest Mackevicius: Yes. Don't you think that villages all over Russia will burst into flames next summer, just to get the Government to address their problems?

Vladimir Putin: Let's start with the first part of this question. Of course, we still face a lot of problems related to housing sector development. We have a lot of dilapidated housing and people in numerous barracks need to be resettled. The state has a lot to do in this respect.

As for what we did to help people who lost their homes in the fire, our actions were a prompt and highly targeted response to a massive problem, the disaster that these people experienced. I repeat, this was a highly targeted reaction.

So what am I getting at? The houses that were burnt down, and those being restored housing were and still are considered private property. How are similar issues tackled elsewhere in the world? I would like to stress that, as a rule, virtually all this property is insured, and people are given compensation following accidents, after their homes burn down.

Unfortunately, this concept is not widespread in Russia due to our relatively low income levels and underdeveloped insurance system. Of course we can not abandon people in their time of need. But we are simply unable to rebuild and replace all homes nationwide at federal expense, even if we wanted to. If we were to do that, we would have to mothball all our other projects, including raising the pension, healthcare reform, in addition to cutting defense spending several times over. So that is simply not workable.

So, realistically, what can we do? First, we can continue to roll out our housing programmes for those social strata directly covered by federal commitments, including the resettlement of people from the far north, providing housing for combat veterans, military personnel, Chernobyl clean-up workers and so on. I would like to say that there is a great deal of work for the construction sector to do. Moreover, we supported the housing sector with the help of state contracts in 2009, which was a rather difficult and problem-ridden year. True, the volume of housing commissioned declined, but only slightly. Last year, we commissioned about 45 million-plus square metres of housing. A total of 43 million square metres were commissioned in 2010. Although the sector has experienced a slight slump, overall construction volumes have been conserved.

But these problems require systemic and drastic solutions.

First, we need to raise incomes. This is the most important thing. Second, the cost of buying a house must be brought down. The construction materials industry and the entire construction sector has to expand. Financial services such as for example mortgage costs have to come down. There are also some other aspects.

If we tackle this objective in a systemic way, then we will undoubtedly succeed. Honestly, I don't doubt this because the Russian Housing Development Foundation will continue to rehouse tenants from dilapidated housing. This is the government's direct responsibility.

Ernest Mackevicius: And what about the second part of the question suggesting that houses could just burst into flames.

Vladimir Putin: That second part actually implies that some people might set their homes alight simply in order to claim this compensation.

Ernest Mackevicius: This is not a baseless fear.

Vladimir Putin: Well, I am not sure if this is fully justified. Let me put it this way. First, the compensation is quite tangible. What have we done? The state built houses for free. In fact, we paid 200,000 roubles per family member in compensation for lost movable property. We helped people to buy furniture at a 30-50% discount. United Russia provided nearly every home of the fire victims with household appliances free of charge. And so on. All this is disaster relief.

Ernest Mackevicius: In other words, it was a blessing in disguise?

Vladimir Putin: No, let me finish. It is our response to a natural disaster. But if it is a domestic fire, which is usually caused by humans, the person responsible must be identified. First of all, this is not a natural phenomenon, not the result of a natural disaster, and the scale of the consequences is smaller than the consequences of a natural disaster. There will still be compensation, but it will be of a different order.

Ernest Mackevicius: And it's easy to tell the difference.

Vladimir Putin: Yes, of course. There was a recent incident in Dagestan, that's in the south, it was a clear case of careless handling of fire. Some people set fire to a landfill. That is not a natural phenomenon, not a natural disaster. That's my first point.

Second, if somebody does it deliberately ­ as the case may be ­ this is a criminal offense called fraud, and it carries a six-year sentence or, under certain aggravating circumstances, up to ten years. This is also easy to determine. Forensics experts can establish if it was arson. So I hope we will be spared such incidents.

Ernest Mackevicius: And hopefully, the people who were planning to do it will take heed of what you've just said.

Vladimir Putin: People are presumed innocent, not presumed guilty, and I don't know if anyone was actually planning to do this.

Ernest Mackevicius: Thank you, Mr.Putin.

Thank you, Dmitry. And thank you, Ivatino.

Another topic that has been raised here is the housing and utilities sector. There are a great number of questions about utilities, what with the confusion surrounding the managing companies and the homeowners associations. But what worries people most of all is that utility rates are growing with each year, while the quality of service remains the same as it was in Soviet times. "Doesn't this country have any able managers who can put the utilities sector in order?" writes Zoya Martemyanova from Pervouralsk. And this from another letter: "My husband and I are disabled. Why have they abolished discounts on utilities?" This is from Lyudmila Yevdokimova, a pensioner who lives in Perm. In other words, the utility rates are growing, the supply lines are worn out, discounts have abolished and embezzlement is rampant. What should be done about this situation?

Vladimir Putin: This is a common refrain, we talk about it all the time. And of course the cause is systematic, chronic underfunding of the housing and utilities sector. What happens in practice? The local authorities underfinance this sector, do not raise the rates as scheduled because they want to appear all white and furry before their local community, city or village. They fail to do it on time and put themselves out on a limb: eventually they have to raise the rates in one fell swoop, as happened early last year. The supply lines deteriorate, the system is cash-strapped. But that is only one problem.

Another key problem is that this market is monopolised.

It must be acknowledged that many municipalities have pampered local utilities, which charge monopolistic prices for their services without improving the quality of services.

Another major challenge, then, is demonopolising the utilities market. This should be closely watched by local deputies who should press for the adoption of anti-monopoly regulations in the regional and municipal markets. That is a very important issue. Without this we will never turn the situation around.

Of course, before people entrust their houses to homeowners associations, the municipal and regional authorities should to everything to make sure that the housing they are handing over is in proper condition. It is not right to hand over dilapidated buildings in the hope that the people will pay through their noses to get their house repaired. That is inadmissible and wrong. And yet this is what they try pull off in some places.

Who asked the question about the end of discount rates?

Ernest Mackevicius: Lyudmila Yevdokimova from Perm.

Vladimir Putin: I would like to tell Lyudmila Yevdokimova from Perm and other people who are entitled to discounts (mainly disabled people) that no one has abolished the discount rates. The situation in Perm regarding that issue needs to be looked into. These categories of citizens are entitled to a 50% discount on utility rates, as before. The federal budget allocates considerable sums of money ­ 100 billion roubles ­ for these purposes every year, including this year, and transfers them to the regions, and then the regions are supposed to pass along the discount.

I am aware that in some regions they have monetised benefits, as it's called. First of all, this increases government spending. You see, if a person pays 50%, and if, for example, he uses firewood to heat his house, he pays modest sums for utility services (50% is not a whole lot of money). But the regional average is much higher. In the event of monetisation, it would seem that a person should be paid more, but if they do adopt this scheme, the authorities should first pay the money, put it in the person's account and then have him pay the utility rates and not the other way around: first make him pay and then pay out the benefits, and not always the full amount. This practice cannot be tolerated. We will look into the situation in Perm.

Ernest Mackevicius: I think the managing company is to blame.

Vladimir Putin: The managing company has a manager. So we should see who manages this managing company and how.

Ernest Mackevicius: We have some follow-up questions from our information centre. Maria Sittel, please go ahead.

Maria Sittel: Yes, Ernest, we have a great deal of questions about housing and utilities. Very relevant questions at the onset of winter. It is a sore topic, and there seems to be no light at the end of the tunnel. What people need is not pieces of paper or special laws. They need normal sewage, central heating ­ nothing special.

People say the law does not work. The managing companies neglect their duties. Imagine how cynical a person must be to fraudulently set up a managing company in order to rip off ordinary people.

There are many questions like this. People are asking how much longer they have to endure it and when some real change will happen in the housing and utilities sector.

Vladmir Putin: I just addressed this issue. I'm not sure if I can add anything new.

The market should be demonopolised. The deputies should take action on this and regard it as a priority. This is the only way to break the deadlock. We need to deal with the problem.

Mr Znamenov, the curator of Peterhof Palace, told me that Peter I, while he was with the troops during the Northern War, sent a design for his personal toilet, essentially a sewer system. He personally gave thought to such matters, and he was the emperor. The deputies of local and regional assemblies should not think it beneath them to attend to these matters and to pay more attention to them.

I repeat, we will continue to provide subsidies in the necessary amount. It is not a simple problem. Indeed, it is one of the most difficult problems. But with effort it can be solved.

Ernest Mackevicius: Let me remind you that there are many decent and committed people gathered in this studio. Let's give them a chance to ask Vladimir Putin a question.

Over to you, Maria.

aria Sittel: Yes, thank you, Ernest.

There are many members of student volunteer teams here. They are even wearing their uniforms to attract our attention. We've noticed you. Please, introduce yourself and ask your question.

Yevgeny Babakirov: Good afternoon. My name is Yevgeny Babakirov and I am from Rostov State University of Railway Transportation.

My question is not about student brigades. As a resident of the Rostov Region I am greatly concerned about the terrible crimes at Kushchevskaya, which is not far from us, and the events in Gus-Khrustalny. Everyone was shocked by what happened there.

There is currently a major reform under way to transform the militia into the police. The funds involved are huge. Is there is a guarantee that what has happened will never occur again?

Thank you.

Vladimir Putin: The point of the reform is not to change the name. It concerns deeper changes, which we want to take place in the structure of interior ministry bodies and in their work following a broad public discussion and consideration of the draft law in the State Duma. Of course, it is too soon to say whether the changes will happen or not. But that is the president's intention and not just to alter the sign.

Incidentally, you mentioned that the reform requires a huge amount of money, but that is not true. No money has been spent yet. But funding will be required, above all, to improve the living standards of police officers.

As regards the terrible events in Kushchevskaya and Gus-Khrustalny, it revealed a problem with all law-enforcement agencies, not just the police. Is the police alone responsible for maintaining law and order there? What about the prosecutors? What about the Federal Security Service? What about the Federal Drug Control Service? And what about the courts that were supposed to pass rulings?

I think the entire law enforcement system has failed. Where were the regional authorities? Didn't they see anything? It is therefore an important signal. It is another signal for society to wake up and for authorities at all levels, including federal, to wake up, too, and see what is going on in the regions.

There was a time when I received a lot of criticism for changing the procedure for electing governors in the Russian regions. I still get criticism but one of the motives for this change was to keep criminal elements out of local governments. Unfortunately, civil society is not yet effective enough in our country, and with so-called "direct elections", nearly every candidate had a criminal looming behind his back, who tried to use his "unaccounted-for" money to influence the election campaign and its outcome and did it with a degree of success.

Now when the president proposes candidates for governors, and local deputies must vote for or against, this somehow hedges society against criminal inroads, at least at this high regional level of administration.

Unfortunately, the situation in municipalities is not the same. We have direct elections of municipal administrators and criminals continue to have a say there.

I have some ideas about ways to address this, without abolishing elections, of course. They should not be abolished at the municipal level. What we need to do is to monitor these processes more closely, both at the federal and regional levels. And we must certainly strengthen the law enforcement system.

Now about Gus-Khrustalny. When I was visiting the Vladimir Region, two women asked to see me ­ I think they were from Gus-Khrustalny: both of them had lost their sons there. In fact, that started the ball rolling on the investigation of the criminal activities in the town.

On my request, the Prosecutor-General's Office and other law enforcement agencies have now got down to business in earnest and I hope criminals will face trial and be brought to justice.

Yevgeny Babakirov: They have also detained the mayor of Engels.

Vladimir Putin: Yes, I know.

Ernest Mackevicius: But, Mr Putin, it appears these people were just lucky to have met you so that you were able to support them. But in other places, who can people turn to?

Vladimir Putin: As I said, it is society as a whole ­ the regional authorities, federal and public organisations ­ that should monitor the situation very closely. And every one of us, every citizen, when going to a polling station, especially when electing local administrators, should give their vote to a candidate for his or her for personal and leadership qualities, and not on the basis of empty pledges. As a rule, people who live in small towns and villages know who backs these candidates.

Ernest Mackevicius: They are just afraid to say so.

Vladimir Putin: Yes, perhaps some of them are afraid to talk. But when they vote for those candidates, they should remember that the ballot is secret. And they should not trust the promises made by such shady characters. Every one of us should be aware of the consequences of what we are doing. But that in no way frees the authorities of responsibility.

Ernest Mackevicius: We have questions from the call centre. I give the floor to Maria Sittel.

Maria Sittel: The processing information centre is very busy now, with its operators taking hundreds of calls every second.

Let me give you a few figures. As of 12.30 p.m., we have received 1,744,000 calls, text messages and emails. Any one moment, 3,776 people are trying to reach us by telephone.

St Petersburg, Bashkortostan, Irkutsk and the Kemerovo Region are active now, while before we went on the air Moscow, the Krasnodar Territory and the Rostov Region were traditional leaders.

Mr Putin, very many people have sent telegrams, not trusting the telephone or the internet, to be sure of getting on the air.

Here is Yelena Bacheva writing from Perm. She says that the outgoing year was the Year of the Teacher and speaks of problems in education. "In the Year of the Teacher it should be possible to destroy the Potyomkin villages raised by bureaucrats. Children are crying out from reforms. The state that saves on schools has no future." A real cry from the heart.

And another question about education: "How long will teachers have such low wages? A full-time primary school teacher is paid 13,000 rubles a month. The taxes, rent and other expenses leave 7,000. This is below the subsistence level in the Krasnoyarsk Territory," writes Alexander Belov.

Vladimir Putin: This is an acute problem, it is true. We have been focusing on demographic and healthcare issues for several years now. We also have the Education National Project.

I cannot but agree that the income level of teachers is low. On the average, it is about 25% to 30% below the level in the economy. That is bad.

So what solutions are there? There are three ways to address the problem.

The first and the simplest ­ and it should be done ­ is just to raise the incomes of teachers, raise their pay. But that is not enough.

We need to restructure the network. The number of school students has been falling but the network remains large. I know what I am saying. I am sure people will say: "They are going to start closing schools again." There is no programme for school closures, and there will never be one, but the number of schools should correspond to the number of pupils. If this is to be done, it should be done calmly, keeping the teachers, keeping the personnel, helping people to retrain, etc. There are many ways of tackling that problem. There will be no sudden steps and nothing will be done to harm the teachers.

And finally, the next plan is to move to a different format of remuneration. We have discussed this on many occasions. We propose estimating the total sum each school needs (which is easy to calculate based on the previous years' experience) and transferring that amount directly to the school. The school policymakers, including parents and the community, and the headmaster, will then take decisions on optimizing their expenses, such as cutting heating and electricity costs, construction and repairs costs, and non teaching staff costs, to raise teachers' incomes.

This does not mean firing all the caretakers, not carrying out any repairs, not planning any redecorations, or switching off the heating and electricity. What I mean is that everything should be done efficiently. Try not to use more heat and electricity than the building actually needs. There are a lot of ways of making these savings without disrupting the teaching process and ensuring that the environment continues to be comfortable. Some regions are already doing this, and teachers there are on wages that are at or above the local average. These regions are Tyumen and Kaliningrad, and there are ten more. So this practice is already in place.

In conclusion, let me reiterate my initial statement ­ teachers' salaries simply have to be raised. I know these policies are adopted at regional and municipal levels. The federal government is also providing support for these policies, and will continue to do so ­ I am referring here to the federal subsidies issued to the regions.

Ernest Mackevicius: Maria, have we had any other questions from our viewers, by phone, text or email?

Maria Sittel: There certainly are. We have taken a lot of questions here.

Once again, our direct line is 8-800-200-40-40. Call us toll free from your home or mobile phone.

Let us not test the patience of our next caller any longer. I am being told this caller is from Irkutsk.

N. Simakova: Good afternoon, Mr Putin.

I have a very simple question. Do you think it fair that Mikhail Khodorkovsky is still in prison? I don't really expect you to answer. I know you prefer talking to retired elderly women bursting with gratitude or answering questions about your favourite dogs. Thank you.

Vladimir Putin: I have two dogs. I don't know which of them you have in mind.

As for what you said about those grateful elderly women, I just so happen to believe that every single one of us has a duty to the older generation. We have not yet been able to give them all they need and deserve, but we are trying hard and making some headway, however a great deal still remains to be done.

As for Khodorkovsky, I have expressed my opinion on this on many occasions. But if you want me to repeat myself again now, I will. It is my conviction that "a thief should be in jail" [a quotation from a famous Soviet film starring Vladimir Vysotsky]. Khodorkovsky has been convicted, by court, for embezzlement, pretty major embezzlement. We're talking about tax evasion and fraud involving billions of roubles. Then, very importantly, there was also the matter of his personal tax evasion.

But the new embezzlement charges he now faces run to sums of 900 billion roubles in one case and 800 billion roubles in another.

If we look at other countries' legal practices, in the United States Bernard Madoff got 150 years behind bars for a similar fraud scheme involving similar sums of money. Russia by comparison, I believe, seems a lot more liberal. Anyway, we must start from the fact that Khodorkovsky's guilt has been proved in court.

In addition , as you are probably well aware, and now I am not talking about Khodorkovsky directly, but I note that the Yukos security chief is currently serving time for murder. The mayor of Nefteyugansk, Vladimir Petukhov, got in their way and so they killed him. One woman in Moscow refused to hand over her small property, and they killed her, too. And then killed the assassin they hired to carry out those killings. All they found was his brains, splattered all over his garage. Do you think the security chief decided to carry out these crimes all by himself?

So we have the court system, ours is, by the way, one of the most humane in the world, and this is their bread and butter. I start by accepting the court ruling.

Ernest Mackevicius: Mr Putin, while we were going through the questions in preparation for this session, we noticed an increase in the number of requests for you to visit and personally deal with problems on the spot. Maybe they were inspired by your drive along the Chita-Khabarovsk highway in your yellow Lada-Kalina. During that trip you visited places that no big boss has ever visited, let alone one of the country's top officials.

Therefore, we could not help but return to the town of Aksyonovo-Zilovskoye where you met with local residents and discussed local problems and prospects.

Our reporter Pavel Zarubin is currently in Aksyonovo-Zilovskoye, and we can go live to him now. Pavel, good afternoon, or rather good evening, judging from what we can see on the screen!

Pavel Zarubin: Hello Moscow!

I'm here live in the town of Aksyonovo-Zilovskoye on the Trans-Siberian Highway. Over the last few days temperatures at night have dropped to - 48 C here so we're coming to you from inside the railway station, where it's warmer.

It is nearly seven in the evening here, the working day is over, so a lot of people have come down here.

Our camera crew has been in the town since Monday. We have had numerous opportunities for detailed conversations with local residents. The day when the prime minister stopped by last summer in his bright yellow Kalina on the way from Khabarovsk to Chita, has certainly been one of the highest profile events they have had for years.

That visit in fact started a local programme to rehouse people out of dilapidated and dangerous old buildings to new ones, and other important improvements. However, we face other problems here, and some of them are quite pressing. That is probably what these people want to discuss with you today.

Let's get started. Who wants to go first?

You've talked rather animatedly about all these problems recently ­ would you like to start?

Natalia Bultinova: My name is Natalia Bultinova, I'm a director of a school. We received expensive equipment after your visit, and we are very grateful to you for this. Unfortunately, most of that equipment is gathering dust in the closet. And we fear it will be stolen because we don't have security in the school. And besides, repairs haven't been made to the school for years, and the building is basically falling apart.

The situation at our school is indicative of the situation in the town. Our hospital has no equipment. When people call for an ambulance, they are told that it will come if they can pay for petrol. Our maternity ward has been closed so future mothers have to travel 400 kilometres to Chita to give birth to their children. And we don't have a children's ward in the hospital.

And one more thing. In five months our children will have to leave the town at five in the morning to take graduation exams in another city. You can imagine how stressful that is for the children and also for their parents.

On the whole, like everyone else, I am worried about the future of our town. You are the ultimate authority for everyone, and something was done in our town before and especially after your visit, but we fear something else. You have visited our town and are having this televised question and answer session today, but what will happen after this? The problems of our town will be forgotten as soon as you stop monitoring them.

Thank you.

Vladimir Putin: It was truly by chance that I visited the town of Aksyonovo-Zilovskoye during my recent tour of the Russian Far East. My colleagues and I stayed overnight nearby. I remember the first part of our conversation, which was spontaneous. I simply stopped when I saw a group of people; I think it was near the building of the local administration.

The second part of the conversation was particular and clear, but the first part, the spontaneous one, was emotional and intense. The problems you have mentioned here were already brought up during that meeting. This is why I raised them during talks with my colleagues in Moscow and with your governor, trying to help the regional governments to move forward on these issues. I am referring to medical services, the school, and the future of your town, which I believe is the most important thing. I will speak about it at the end of my answer to your question.

Regarding medical services, I have already said that we are ready to help your municipal hospital. If it is true that you have not received any equipment and nothing has been done to this day, I will raise the question again. But if equipment was supplied and is only being stored in the closet because you are afraid of installing it, just like the equipment we sent to your school, we will be unable to do anything to resolve your problems. You must admit that you yourself should organise the process and draw the attention of the local authorities and law enforcement agencies to the problem [of security].

What you have said here sounds strange. You haven't installed the equipment because you fear it could be stolen. In this case, you can say in all sincerity that there is nothing to be done. When I spoke with teachers in your town ­ and I think the school director was there too ­ everyone spoke with such pride about your students, which goes for the teachers as well. You said that your boys and girls are admitted to the best Russian universities. This means that you have a high-quality teaching staff and that your school has good traditions.

I'd like to address everyone who is present here and everyone listening to this televised event. I was impressed that the people in that small town were proud of it and spoke with such great respect about it. They live modestly, but they are patriots of their town, which certainly should be supported.

Once again, if necessary, I will give this an additional push and send the necessary signals to the governor. Your governor is an active and experienced person; he has been on the job for a long time and, as far as I know, has reacted promptly to what we told him. But I agree that he must ensure the security of the new equipment at your school; the medical and educational establishments will be unable to work without proper security.

As for medical services, apart from modernising your hospital, which we are also prepared to facilitate at the federal level, Russian Railways should also take the necessary action to provide essential medical services in your town. The rail monopoly is certainly capable of doing so. It has a medical train, I have seen it ­ it is basically a modern hospital on wheels. I will certainly tell the head of Russian Railways that the train should also be used in such regions, to reach outlying towns and villages, remembering that your town was established to promote the development of the railway system. I hope you will see that train soon.

Now for the town's future. I can assure you that we are restructuring the railway system to redistribute the load, but such towns as yours will still be important in the future because the volume of cargo transport by the Trans-Siberian Railway is growing. It has exceeded the Soviet-era volume, and the existing infrastructure is no longer sufficient for its operation. We will soon address the issue of infrastructure development, which also involves the development of such towns as Aksyonovo-Zilovskoye.

Ernest Mackevicius: Pavel, do you have any more questions from the Chita-Khabarovsk route?

Pavel Zarubin: Unfortunately, the issues mentioned above are far from all the problems in the town. People have other questions.

Next, please.

Question: Good afternoon, Mr Putin. The railway is everything to us ­ our jobs and our very lives. It is our teacher, our employer and our link to the world.

Until recently, all passenger trains stopped at our station. The Moscow-Vladivostok and the Rossiya trains are the only possibilities for us to comfortably travel to a holiday destination or to visit relatives. In the past, the train stopped for barely a minute, but now it doesn't stop at all, although it stands for about half an hour at the neighbouring station.

Couldn't it stop for at least a minute?

My second question, which is no less important, is that our children who study at universities away from home often cannot come home for holidays because of high ticket prices, not to mention the high cost of tuition and living away from home. Maybe students travelling to their home towns could be given some travel funding or cut-rate ticket prices? Thank you.

Vladimir Putin: The issue of long-distance trains stopping at small stations falls within the responsibility of the railways, which try to streamline their economic effectiveness. I am sure that the leadership of Russian Railways is listening to our conversation and has heard your question. This is first.

Second, as far as I know, Russian Railways have taken measures to assure that you can travel to your jobs and to improve living conditions in your town, such as the maintenance of several sports facilities and the improvement of transport services. It is now running a commuter train in the morning and the evening for those who work in a neighbouring town, I think it's called Chernyshevsk.

As for students travelling to visit their relatives from other regions, first of all from the European part of the country, you probably know that we have approved reduced ticket prices for students, for young people up to 23 years old and for pensioners over 60 years old. They can take advantage of this privilege. Moreover, we are expanding these easy-term travel routes to other regions. We'll see what else we can do to resolve this problem.

Ernest Mackevicius: Thank you, Pavel. Thank you, Aksyonovo-Zilovskoye.

Mr Putin, I'd like to add that there are very many questions about commuter trains; this is an especially big problem in major cities and large towns that people from the suburbs, sometimes millions of them, travel to daily for jobs or studies. People write that a monthly pass sometimes costs as much as a monthly pension or a small monthly salary. Soon commuter trains will become an impossible luxury.

This is what Alexei Aleksanov, a retired officer, writes: "I live in the military town of the Taman Division. A return ticket to Moscow costs 200 roubles and a monthly pass costs 3,500 roubles."

Vladimir Putin: Yes, that problem does indeed exist. It is becoming increasingly acute.

Why is this? It is related to the fact that when this commuter railway infrastructure was created no one assessed the economic aspects. These commuter trains can't just be run with two or three carriages; they require a minimum of eight. And if these eight carriages carry just eight people then they are simply not cost-effective. It works out as a really extravagant form of transport.

So what should we do about it? Naturally, we can't leave things the way they are. We must put in place all necessary measures and take all the required steps.

What steps are these? First, the regions are currently tackling this issue. The plan is that every region of the Russian Federation will sign an agreement with Russian Railways and make up the company's revenue shortfalls resulting from this insufficient commuter traffic. The Government in turn is ready to provide the required subsidies from the federal budget.

Of course, this is not a radical or long-term solution. A long-term solution involves infrastructure investment and the procurement of new rolling stock that would make it possible to operate trains made up of two or three, rather than eight, carriages or even single-carriage trains for the required number of passengers. We also need to introduce alternative forms of transport, including buses, where they are in demand and can be economically justified, and where people find it convenient to use them.

We have just heard from people in Aksyonovo-Zilovskoye, we built a road there. Now it's time for local authorities to think about passenger traffic along this new road. We will continue to act along these lines.

Although the problems we face today are indeed acute, we need to make sure these prices are kept in check, no matter how hard this proves for the regions and the federal budget. A small increase is planned for next year, but it will be less than in 2010.

Ernest Mackevicius: At one of your news conferences you said that for the situation across the country to normalize, everyone should till their own little plot of land, right after waking up in the morning. You know, we even found someone who did this in a very literal sense. After all his colleagues were laid off, he stayed behind and kept an entire airfield in working condition. As a result, he saved 80 people. He is with us now in the studio.

I will ask Maria Morgun to go over to him.

Maria Morgun: We're joined now by Sergei Sotnikov from the town Izhma in the Komi Republic. I would like to draw your attention to the fact that this man has been maintaining a runway single-handedly for the past 12 years. This September, a TU-154M aeroplane en-route from Yakutia to Moscow landed there, after all its flight instruments failed.

As we recall, the plane's crew were given awards. Mr Sotnikov has not, so far, been given an award, but our people value his work and the internet community in the Tomsk region has already declared him the People's Hero.

I know you came here today to ask a question about a difficult subject.

Please go ahead.

Sergei Sotnikov: Thank you for your kind words.

I would also like to say that I'm happy that I was able to help people survive.

I have a question. The Komi Republic used to have numerous local airports handling small aircraft. Antonov An-2 planes flew to virtually every village and were affordable. An-24 and Yakovlev Yak-40 airliners flew to major airports, importantly providing much needed traffic for these transport hubs. Some local airports have downsized their operations while others have been closed. Some of them, including our airport, have had their status changed to that of a helipad.

I have a question: is there any plan for a renaissance in small aviation in the north? Would that be possible or not?

Vladimir Putin: Mr Sotnikov, first of all, allow me to express my admiration for your sense of duty.

May I put a question to you? You must have realised that there were probably no plans to use that airport. Why did you keep it in working order?

Sergei Sotnikov: I hoped that small aviation will be revived because, as they say, hope dies last.

Vladimir Putin: So, you believed that the runway should be preserved because it will be needed and then used?

Sergei Sotnikov: Yes.

Vladimir Putin: I can tell you that you were right. That is likely to happen.

Obviously, small aviation today faces tremendous problems. This is linked with the air fleet and infrastructure, primarily the airport infrastructure. We have drafted an entire programme detailing the expansion of small aviation. The main elements of this programme are as follows.

First, we have virtually abolished small-aircraft import duties. This does not hurt our producers because, unfortunately, Russian enterprises still don't produce small aircraft. All these small Antonov planes were decommissioned long ago, and new planes are still lacking. I hope they will appear. We have, I repeat, cut import duties on planes seating up to 50 passengers right down to the minimum. We decided to give small airports for which there is demand, and particularly those in the country's far north and the Far East federal status and federal financing, in order to develop local routes. Russian regions will subsidise local airlines. We have agreed that, if need be, we can step in and support local budgets in order to help implement this programme. Such a need is likely to arise. We're talking here about the construction of 50 runways, during the initial stage.

Ernest Mackevicius: And now back to the call centre which has been swamped with incoming calls and messages. Maria Sittel is there now watching them come in. Over to you, Maria.

Maria Sittel: We have been here working for over an hour, and the centre for collecting and processing information is approaching peak performance. The servers do not have a problem. The workload is ramping up. This is what we heard from the experts. And regarding the answer to the question about everything being okay, the communications personnel have reassured us that "six-fold redundancy is available." What that means, I don't know, but somehow it was reassuring. I hope that we'll get through the broadcast in perfect working order.

The text-messaging users are very active, and it's not only the youth but also older people, as evidenced by the sharply tinged social-issue tone of the questions asked. Thus, there are more than 1,000 text messages per minute coming in. Again, the servers are dealing with the load.

The Volga region has come out on top, the Central Federal District is in second place, the Southern and Northwest districts are tied for third place in terms of activity of callers and those who sent letters via the Internet and text messages.

Let's now give them the opportunity; we now have a live link with Perm. Hello, you're on the air.

Question: Hello, Mr Putin!

Vladimir Putin: Hello.

Question: This is Svetlana speaking. I wanted you to ask a question about the former mining settlements and Yubileiny and Shumikhinsky. They are called the "second Chechnya" because they look like they've been bombed ­ no transport, no medical services, no jobs. And you're probably getting reports that all is well, but it is not. See for yourself; after all, it's also Russia.

Vladimir Putin: Which territory is this? Perm?

Maria Sittel: Yes, it's a call from Perm Territory.

Vladimir Putin: The situation in coal mining was very critical eight years ago. During that time, the industry was being restructured, and today it is among the leaders in the Russian economy. Last year, during the crisis, the situation for miners, of course, deteriorated due to falling prices and demand for the product. Company finances deteriorated, company structures declined and wages fell. This year, the coal industry is, in fact, recovering towards the pre-crisis level; it has not yet reached pre-crisis levels, but is close to it, and the trend is positive.

Over the previous years, as I said, much has been done to restructure the industry. However, judging by what Svetlana said ­ unfortunately I do not know your patronymic name ­ after all, it turns out, as I now hear, a lot of social issues have not yet been resolved. And this is connected with the miners' settlements, which were, as we see now, left outside of the implemented measures, including the creation of new jobs. And what we hear and see in the relative background ­ I want to say this very carefully ­ the well-being of the entire industry ­ is, of course, in a sad state, which is evidence of the obvious deficiencies of those involved in it.

We had a programme that ended last year ­ a programme for the infrastructure development of settlements of this kind and resolving other social problems associated with the restructuring of the industry. I think that we will continue this programme ­ in the near future, we will calculate and allocate additional resources from the federal budget to address problems of this kind.

However, the industry continues to evolve ­ some mines are just starting, others are closing, and this is natural. Of course, we need to think about the future so that the rather sad events related to these settlements, that Svetlana mentioned, do not occur.

In some industries, energy, say, the nuclear industry, it's just like it is abroad, special so-called liquidation funds have been established, created under the current activities of enterprises, and they accumulate the necessary resources, which are then used in a restructuring and to address social issues when individual companies are closed. I think that such liquidation funds will also need to be established in the near future for the coal industry.

With regard to these two villages, we will now pay special attention to this.

Ernest Mackevicius: I propose that we turn again to our studio audience, since there are more than enough people here who want to ask questions.

Maria, please, those on your platform are the most interested.

Maria Morgun: Yes, we have lots of people who want to ask a question. I want to say that among those present, there are quite a few people from Tyumen ­employees of the Tyumen Oil Research Centre. Many of them already met with you, Mr Putin, in February of this year when you visited this centre.

A. Dubok: Good afternoon, Mr Putin, very nice to see you again.

My question is the following: you did not travel to Switzerland to pressure the FIFA committee, and we are now going to host the World Cup. But you were there when we were granted Sochi 2014. Are you really so lucky, and what's the secret of your success, Mr Putin?

Vladimir Putin: Yes, in general. Seriously, God helps those who help themselves. You need to work, including and above all, work with people, show respect for them, to prove your worth and do it insistently but tactfully. So far, as you see, it has worked. And I hope it will continue to work in the future.

As for the World Cup, in Sochi, everything is concentrated in two places ­ the Imereti lowland on the Black Sea and the mountain cluster ­ which for Sochi, by the way, is very important.

You know, I've talked about this many times, and now I'm convinced more and more. This is really one of the few places where our citizens can go on holiday to a mild subtropical climate almost all year round. The city of Sochi was in an unacceptable state of disrepair. There wasn't even a sewer system. Well, what's a resort without a sewer?

Every winter, the wires break in the mountains, and the entire city is left without power. Well, what can you say? You know, if it weren't for this project, I am uncomfortable to say this, but Russia probably would not do what we are doing now in a 100 years, and perhaps it would never have done it. Roads, gas pipelines, a new power station, eight sub-stations, bypass roads, 84 tunnels in the mountain cluster, a road into the mountains, not to mention sewerage, water treatment, water supply, construction of additional hotel capacity and hotel beds. But this is Sochi.

And when it comes to World Cup football, this entails 13 cities. Yes, there will not be such large-scale infrastructure projects in all these. But, nevertheless, there is a lot of work to be done on the development of the road network, development of airport and of railway infrastructure. And if we can put together a good programme, and there are already proposals, on the development of high-speed rail traffic between all these cities, or at least between some of these cities, this would be a powerful development impetus for the entire infrastructure of the European part of the country, and this is certainly an advantage.

Not to mention the development of sports infrastructure ­ the stadiums and training venues. All of these will remain for the people and will be functional for decades, and they will encourage a healthy lifestyle, will help ensure that young people engage in sports, where they will be able to do this to contemporary standards. This means that there will be less crime and less drug abuse. Ultimately, this will be a comprehensive and positive, very positive impact on the future of the country, and I am sure we will conduct the games in a very dignified manner.

Ernest Mackevicius: Mr Putin, before you give our studio co-host the floor, I would like to ask a few of the questions that came via text message.

A question that came via text message and clearly seems to have been sent from the capital is, "Why do Muscovites live dignified and rich lives, and the regions in poverty? When will Moscow unite with the rest of Russia?"

Vladimir Putin: This is a polemical question. I want to say that not all Muscovites live on the fat of the land. Muscovites vary in terms of income, and the cost of living here is more expensive than in the regions of the Russian Federation.

Ernest Mackevicius: It's a very expensive city.

Vladimir Putin: Therefore we cannot look only at income; we also need to look at the costs.

Yes, there is a small, very narrow category of people who live far above the average, but you can't really call them Muscovites ­ these are people of the world, and who knows exactly where they live ­ New York, Moscow or Paris, and the ordinary Muscovite is not in clover and lives quite modestly.

But this does not mean that everything is fine in small towns in the country; there are lots of problems and we should pay more attention to the development of small towns and small cities. Of course, this is primarily the task of the regional governments, but it is not limited to them, and the main thrust of the federal government is to ensure investment in the fixed capital of Russia's regions.

Incidentally, some positive trends can also be observed here. Last year saw investment in fixed assets decline, but this year it is back in the black. Last year we were obviously talking minus numbers, I think, below 10%, about minus 16%, but this year it has clearly been back in the black.

What is good is that this investment is flowing into small cities. First, because investing in Moscow is expensive now and there is not enough space there, and second it turns out that people in small cities are educated and trained to similar standards, but business expenses are much lower, and that taken together these factors can yield quite a positive economic result.

Take Kaluga for example. Of course their governor should be given some of the credit since he has really focused on attracting investment, and Volkswagen is one of a number of other major manufacturers that have opened facilities there. I have been in constant contact with them, and they are satisfied. But I would like to stress once again, that this is something the governor has focused on. He has made sure that all the leading companies that have shown an interest in investing in Kaluga have his direct line. Of course, they don't call him every day, but the fact that they know they can pick up a phone and call the governor directly has had a positive influence on the entire team. And this is one of the least bureaucratic places there is, from the point of view of attracting both domestic and foreign investment. So far we have seen noticeable positive results. If we continue along this path, we will see considerable progress.

Ernest Mackevicius: Here we have another text message with a personal question: "What prompted you to take to the stage and sing? Do you have any plans for a duet?"

Vladimir Putin: With whom?

Ernest Mackevicius: I don't have any suggestions.

Vladimir Putin: I see.

You know, we have been really focused on healthcare recently, and as you can see, we have also been dealing with demographic questions, next year we are to launch a large-scale programme to modernise the healthcare system across the entire country. This is something the government has been doing, something it is currently engaged in, something it has a duty to do and something it will continue to do.

In addition to all that, I believe it is very important to draw the general public's attention to charity, to ensure we have a well-balanced society able to offer support to everyone that needs it.

We held a charity concert in St Petersburg in aid of children who are struggling with serious health problems. The atmosphere of the event was upbeat and friendly, and there were a lot of foreign celebrities in attendance. I would like to express my gratitude once again for the warmth and spirit in which they greeted everything that took place that evening. This sense really helped us show that we too are capable of achieving something here.

Ernest Mackevicius: Thank you

Now, back to the studio.

Maria Kitayeva, over to you.

Maria Kitayeva: Mr Putin, I am here with some of your old friends, people you have met on more than one occasion. I am talking, of course, about the Night Wolves. I would like to hand over to their leader Alexander Zaldostanov, better known as "Surgeon". You took to the road alongside him.

Alexander Zaldostanov: Mr Putin, I would like to ask you a question about Ukraine. This year we held our bike show, dedicated to the 65th anniversary of victory over Nazi Germany. We would not have won the war if we had been different states. I had the honour to ride alongside you, with over 5,000 bikers from different cities and different countries across the world accompanying us.

Even going by the most conservative estimates, over 50,000 people attended the show. And this is the question I have for you. You once said, though I can't quote you word for word, but you said something along the lines of: he who does not want Ukraine to unite with Russia, has no heart, and he who wants it to, has no brain.

So this is my question. Would agree with the statement that the heart can sometimes take the place of the brain, but the brain can never replace the heart?

Vladimir Putin: Alexander, you put that very cleverly. I am not sure even I understand what you're getting at.

First, I do remember what I was talking about. I was talking about the collapse of the Soviet Union. I was saying that: "those, who do not regret the collapse of the Soviet Union have no heart, and those who want it to be resurrected in its previous form, have no brain". But we should let that lie. It's in the past.

What did I want to say. First I would like to thank you for inviting me to the event you held in Crimea. I would never have expected that so many tough guys would descend on the place, that you would be so organised, properly disciplined, responsible. Very serious people indeed. I found that a complete surprise.

I was simply blown away by one of the participants, from Serbia, I think. I think he had lost a leg in combat, he had only one leg, but still made his way thousands of kilometres on his two-wheel motorbike, to take part in the event. As an event, it was also fun. After all, they chose Crimea. But it also had a very clearly discernible patriotic element.

I take my hat off to you. For that, I am indeed, very grateful.

Moving on to our relations with Ukraine.

I do not agree with you when you said that we would not have been victorious if we had been separate states. We would have won in any case, because we are a nation of winners.

As for what I said, it is, to an extent, justified. If we look at the Second World War from a statistical point of view, we see that the RSFSR sustained the heaviest casualties at over 70% of all losses. I don't want to offend anyone, but the figures show that the war was won thanks to the human and industrial resources of what is now the Russian Federation. That is an historical fact, it is there in the documents. But this is not to belittle the role former Soviet republics played in winning that victory.

Undoubtedly, when we were all together, we represented a much greater force. That's why the country's level-headed and patriotically minded state officials never even countenanced the dissolution and division of Russia, Belarus and Ukraine.

In Soviet times, the government tended to scold leaders of the White movement. One of them, General Denikin, firmly refused to even think of dividing the united Russian state with his then-allies ­ the Western countries ­ even at a time when he desperately needed their help and support in the fight against the Red Army. He vigorously opposed any attempts to discuss dividing Russia and underscored that all these processes had been and remained an internal matter for the Russian people ­ of the united Russian people.

Today the situation is different. Today Ukraine, Belarus and other former Soviet republics are independent. So we need to proceed from reality. Nevertheless, we can, and need to, facilitate economic integration for the sake of our peoples and we are doing this.

It is worth mentioning that these measures are the first actual integration efforts in 15 years. I'm referring to the establishment of the Customs Union between Russia, Kazakhstan and Belarus and the next step which we are approaching ­ the establishment of a Common Economic Space.

I would like to emphasise that this will mean a deep economic integration which will allow us to be more competitive. We will have a large market ­ 140 million in this country, 15 million in Kazakhstan plus 10 million in Belarus ­ look, this market can be compared to that of the European Union. If we lift internal customs barriers we will create new opportunities for our companies and only the more competitive companies will stay afloat. This will eventually benefit our economies and our peoples who will be able to receive high quality goods and services at lower prices.

Naturally, our Ukrainian counterparts understand the economic benefits of joining these integration processes and if Ukraine does join them one way or another, this will certainly deliver an important and strong momentum which will help preserve entire industries in Ukraine and will boost the competitiveness of many of our companies. But this is up to the sovereign Ukrainian people and the country's leadership to decide.

Ernest Mackevicius: We are moving on.

The tragedy at the Raspadskaya coal mine not only turned the entire country's attention to the difficult job of coal miners, but it also triggered significant reforms in this industry. New labour safety regulations have been approved and the transition to a fairer payment system has begun. This is why we have Kuzbass on the air for the second year running.

Our observer Igor Kozhevin is currently in Novokuznetsk.

Good afternoon, Igor.

Igor Kozhevnikov: Good afternoon, Mr Putin.

Hello, Ernest.

Novokuznetsk, one of Russia's leading coal mining regions, welcomes Moscow. We are at the headquarters of the mining company Yuzhkuzbassugol. I would like to mention that it was here that Mr Putin met with the coal miners after the Raspadskaya mine tragedy.

With us today are those who were present at that meeting, those who are restoring the coal mine and those who lost relatives in that accident. We have also invited representatives of other coal mining companies in the region. So, we are ready to ask our questions. We only need to determine who will be the first.

Please, introduce yourself.

Sergei Guk: Good afternoon, Mr Putin.

Let me first voice an opinion that, to my mind, everyone here shares. Let me thank you for the care and help that you have given our region and, in particular, the coal miners. We hope that you will continue to give much attention to our region, but hopefully for more positive occasions.

Here is my question. A coal miner can retire after 25 years of working at a coal mine. You know that pensions currently stand between 7,000 and 8,000 roubles. And you understand that it is rather difficult to get along on a pension alone, which is why coal miners have to keep working.

Proposals have been discussed to raise the retirement age or lift some social benefits for coal miners. So, I and all coal miners want to ask you ­ what do you think about this? Thank you.

Vladimir Putin: Thank you, Mr Guk.

You mentioned the attention given to coal miners' issues and measures taken in this respect.

You know that ­ and I have mentioned this ­ the industry is rebounding and becoming more efficient. At the same time, I would have to say that we don't pay enough attention to coal miners. I believe that we still pay too little attention to them.

Coal mining is a heroic job. It has always been and remains so. It takes so much courage to drop down into a coal mine. I have been in coal mines. You know, it takes a person with a strong character, to say nothing of rescuers who go down in a mine to rescue their colleagues not knowing for sure if they themselves will come up again. And the rules are that they descend with dosimetres knowing nothing about the real situation.

I believe that the media, people of art and the public as well as economic, regional and government institutions could and should pay more attention to coal miners. Hopefully this is the way it will be.

The salaries in the industry may be slightly higher than the national average but they could be higher. I can't call for an immediate salary increase which would drag a company down. But you know that we have managed to increase the fixed part of the salary to 70%. I'm convinced that this is fair.

Naturally, a more final solution to these issues lies in modernisation and labour efficiency improvement. I believe that we will be working on these issues gradually.

Speaking about pensions, raising the retirement age and lifting social benefits, we are not planning to do this. Social benefits are defined in agreements between trade unions and employers in each particular industry.

I would like to point out to workers, trade unions and for you, Mr Guk, as a trade union leader, that certain economic literacy is necessary when comprising labour contracts and ensuring that the requirements set are reasonable and will not result in companies' and coal mines' shutting down and, eventually, in unemployment. At the same time, you have to apply certain pressure on the employers during your talks and not let them reclassify working conditions only because, for example, a filter has been installed which might not have improved the working conditions but makes it possible to change the classification category and subsequently deprive workers of some social benefits. This is what trade unions have to keep their eyes on.

You know that we are introducing a certain procedure for safety improvements at the government level and will keep working on this issue from the legislation point of view.

I would like to emphasise once again that there are no proposals to lift social benefits or raise the retirement age. These things are not even being discussed, so you shouldn't worry about that.

Ernest Mackevicius: Igor, we are ready for other questions from the coal miners.

Igor Kozhevnikov: Yes, of course, we do have questions. And I would consider it wrong not to give the floor to those who lost relatives in the Raspadskaya mine accident in this May.


Natalya Merzlikina: Good day, Mr Putin. My name is Natalya Merzlikina, I am the widow of miner Alexander Gorbunov, who was killed in Raspadskaya mine blast. First, I would like to thank you, the government and our region's governor for the material and moral support during this difficult time, and for organising a trip for me to the Holy Land of Israel.

Everyone knows that our town, along with other towns in Kuznetsk Basin, is closely dependant on the coal mining industry, which affects the social sector as well. The issue of single-industry towns is well known. We would like to ask what the future holds for the town of Mezhdurechensk. Thank you.

Vladimir Putin: Thank you, Ms Merzlikina, for your kind words. Your region's governor is an energetic and efficient person, and is well aware of the situation in the mining industry from firsthand experience. Once again, I would like to address him, his deputies and the regional administration and urge them to take a non-bureaucratic approach to resolving issues we have repeatedly spoken about. Not all of them were solved promptly and properly as we agreed in the beginning. I hope that everything has been settled, namely the payment of monetary compensations, children's education, housing and other issues. No one should go by formal restrictions.

I will not go into details concerning the issues we have repeatedly spoken about. For instance, if two people were living together and shared a household together then technically they were a couple, and partners of miners killed in the accident should receive the compensation payable to widows regardless of their marital status. I hope at least this problem has been settled. My last meetings with the widows showed that the work is yet to be completed. Mr Tuleyev, I ask you to make sure everything has been done as we agreed.

As regards the town's future, the Raspadskaya mine is to reopen today. If it hasn't yet, then it will by the evening. Not all consequences of the accident have been eliminated, with fire spots that have yet to be extinguished, water to be pumped out and the remaining bodies to be recovered. This is a matter of the mine owners' honour to finalise these things and bury their dead comrades.

In accordance with the law, all families of the missing miners are entitled to compensations. I expect them to be paid in the nearest future if it hasn't been done yet.

I will say again: the operation of the Raspadskaya mine will be resumed today, where it can be done. Currently, over 3,000 people are employed at the mine. I am aware of the fact that the mine's owners put over 5 billion roubles into emergency works. We should give them due respect as they did not hold back the money required to address social and industrial issues and are making every effort and working very hard in this difficult situation.

Raspadskaya owners have drawn up a plan for the next few years to develop and modernise the mine. This will secure the jobs and the future of the mine and the towns and villages where miners are employed. I hope we will not encounter such large-scale problems and tragedies in the future. With increased work safety measures, we can expect the growth in labour productivity and miners' welfare, as well an increase in their wages.

Ernest Mackevicius: Thank you, Mr Putin. Thank you, Igor, thank you, Novokuznetsk. I see that Maria Sittel wants to join our conversation.

Maria Sittel: Thank you. We have a lot of calls, and many people who want to ask Mr Putin their questions. We have the city of Vyazma on air. Go ahead, please.

R. Rustamov: I am calling from Vyazma. Mr Putin, I would like to ask a question concerning the events which occurred on December 11 and 15, 2010. What do you think provoked the events on Manezh Square and at Kievsky train station? Could they have been triggered by materials posted on social networking websites, such as Vkontakte.ru and Odnoklassniki.ru, where certain people post Nazi and anti-Nazi related videos, photos and audio files? Nobody deletes them and the number of such materials keeps growing. Thank you.

Vladimir Putin: Well, of course, it would be easy to blame the modern means of mass communication, including the internet. Law-enforcement agencies have to be aware of the methods used by radical movements to reach their supporters, and they should take this into account, so you are right in this regard. But there is more to it than that. Such a 'virus' of radicalism is always present in society, just like a human body has many viruses. If the immune system is efficient it will prevent viruses from spreading. In society, the principle is the same: as long as it is mature and has a strong immune system then all these viruses of radicalism and nationalism remain harmless, they stay at the 'cellular level' and out of harm's way. As soon as society is weakened and the immune system cannot protect it, the disease begins to spread.

This is a complex issue. Speaking of the tragedy with the FC Spartak fan who was killed, it was not the murder that provoked all these alarming events but the authorities' failure to respond properly. How come people involved in the murder were released? Of course, this does not give anyone the right to break the law, and this has been mentioned lately.

I will say it again: the government should, and will take tough measures to respond to such disturbances.

Ernest Mackevicius: Let us go back to our live link-up with cities and towns. The Astrakhan Region is next, with one of its major issues being dilapidated housing. It is no coincidence that the movie My Friend Ivan Lapshin was filmed in Astrakhan as its residential areas have remained unchanged since pre-WWII period. The people living in those old houses are not too happy about that.

Now, we will go over to our correspondent in Astrakhan, Olga Skabeyeva.

Olga Skabeyeva: Good afternoon, Moscow!

Good afternoon, viewers of the Rossiya channel!

Greetings from Astrakhan, the famous Volga city or, as they say here, Russia's fish capital.

We are now in the city centre, not far from its heart and main symbol, the Astrakhan Kremlin, built back in the 16th century. Two years ago, Astrakhan celebrated the 450th anniversary of its foundation.

In actual fact, the city's age is its main problem, as there are many buildings in disrepair there. Fifteen percent of housing in Astrakhan is considered too dilapidated to live in, and this is no exaggeration: over 1 million square metres of housing out of the existing 9 million are literally falling to pieces. Almost 50,000 families need new accommodation.

Everyone present here has questions for you. Let's start. For my part, I will remind the audience that Astrakhan's main problem is dilapidated housing.

Introduce yourself, please. Vladimir Putin is listening to you.

Violetta Aksyonova: Good afternoon, Mr Putin,

My name is Violetta Aksyonova.

I would like to ask you the following question. On the one hand, everything is going well: people from dilapidated buildings are moving to new flats. On the other hand, the process is too slow, and people can wait for hundred years more while living in these ramshackle houses. Can't the process be expedited? Thank you.

Vladimir Putin: I would like to remind you that 15% of buildings in Astrakhan are not fit to live in, but there are many more such houses across the country. We have started working on this problem only recently. Just a few years ago there was no relocation from dilapidated housing at all, the figure was close to zero at that time. In the last years we have allocated considerable funding for this programme via the new housing and utilities fund.

By the end of this year, 14 million people improved their living conditions (some people moved to new flats, and some buildings that had not been renovated for 50 to 60 years underwent major renovation). Imagine ­ that is 10% of the country's total population. Another 150,000 to 170,000 people will move to new flats from dilapidated houses by the end of the year.

I would like to emphasise that other people will have their blocks of flats renovated.

Of course, the more the better, but our budget is limited. Moreover, we will even have to cut it a bit. It was proposed to close this fund due to the budget deficiency, but we have managed to preserve it and will preserve in the coming years, especially as our budget deficit, which is one of the main macroeconomic indicators, is much better than had been forecast, as I have said.

We planned, or rather forecasted, a budget deficit of about 6.8% this year, but it is 3.5­3.8%, which is better than in many developed market economies: 11% in Ireland and 13% in the United Kingdom, for example. The budget deficiency of 3.5­3.8% is good enough to allow us continue such programmes. And we will continue them.

As for Astrakhan, the situation was hard there. When I first came to Astrakhan five years ago, I was very surprised, as the city was, to put it mildly, in a lamentable state. I hope Astrakhan residents have seen some changes for the better, especially the embankment, relocating people from dilapidated buildings, etc. There was no stormwater drainage in the city. No doubt, there are still many things to be done there. We will work on it.

Ernest Mackevicius: Olga, we are waiting for more questions from you.

Olga Skabeyeva: Yes, we have a lot of questions.

Our television crew has been working in Astrakhan for a week. We tried to find out everything that the people living here are concerned about. So I will give the floor to the person who will ask the next question. Please, give your name. Vladimir Putin is listening to you.

Rakhmet Bazhbayev: Good afternoon, Mr Putin,

My name is Rakhmet Bazhbayev. I am an administrator at a local construction company.

I have the following question: we have been keeping up with what is going on in Moscow. Astrakhan, as a historically multiethnic city, is really shocked by what has happened in Manezh Square.

Here in Astrakhan Russians, Kazakhs, Tatars, Nogais and people from the North Caucasus, all get along well. And we have never had any problems. I think that a street fight, even one with such tragic consequences, should not be regarded as a confrontation of peoples and cultures.

Thank you.

Vladimir Putin: Rakhmat to you ["thank you very much" in Tatar], for what you said, Rakhmet. It is more than just a question. It is your position. I can only fully agree with it.

I have said it already: Russia is a multiethnic state. That is a source of our strength. And those who undermine the foundation of the state, whatever they may say, are undermining stability in the country.

Ernest Mackevicius: Olga, more questions, please.

Olga Skabeyeva: We have many questions. I think I should give people an opportunity to ask them.

As I have said ­ please state your name and here is the camera.

Yekaterina Kostenko: Good afternoon.

I am a student at Astrakhan State University of Technology. I want to ask whether scholarships will be increased and is such an increase planned for next year?

Vladimir Putin: Yes, Yekaterina and all other students, it is planned. Students, although they are active, young, energetic and full of emotions, are at the same time intelligent and able to understand reality as it is. Often there is no need to explain anything at all: they are all intelligent people.

Look at what is happening in all other countries, I mean those hit by the crisis. Well, in some European countries, and I don't want to name them now, to throw stones at them, they have cut, not even frozen, but cut salaries, pensions and all social benefits, and they have done so several times this year. We have not made any cuts: we have raised all social benefits, pensions and the maternity capital, which was over 312,000 roubles last year, is 343,000 roubles this year and will be 365,000 roubles next year.

Yes, this year we had to suspend the growth of salaries in the public sector and student scholarships, but next year salaries in the public sector and scholarships will be indexed.

Ernest Mackevicius: Thank you, Olga. Thank you, Astrakhan.

We are back to our studio. The issue of interethnic relations has just been raised in one of the live interviews. There are people present here who know for sure what needs to be done so that a person's ethnic identity does not lead to confrontation.

Who from the Islamic University is ready to comment?

Tatyana, please.

Tatyana Remezova: Yes, Ernest, that is absolutely correct.

Here beside me are representatives of such a multiethnic and multiconfessional region as Tatarstan, a very indicative region, so I would like to hear your opinion on this issue.

Who is ready?

Please, introduce yourself.

Vadim Ismagilov: Good afternoon.

Vadim Ismagilov, a graduate student at Russian Islamic University in Kazan.

I would like to say that, first of all, people should be educated about different ethnic groups. Most of the time people base their judgments on stereotypes, which are usually not very accurate. Such stereotypes should be destroyed. The Russian Federation comprises more than 150 ethnic groups ­ that is a very large number. We should at least get to know each other. That would be very useful.

Second, there is the positive example of the Republic of Tatarstan, with its many Volga ethnic groups and multiconfessional society. Nevertheless, they all get along with each other very well.

I would like to add that Russia's multiethnic population is both its pride and its Achilles' heel.

Tatyana Remezova: Vadim, what question would you like to ask in view of what you have just said?

Vadim Ismagilov: It is also necessary to heed the wishes of small ethnic communities. For example, there's a problem with building Muslim shrines in Moscow. This issue should have been resolved long ago. Is it really necessary to turn to the prime minister to have it resolved?

Vladimir Putin: You know, it's not only in Moscow. A mosque is to be built in Moscow, too, and it will be built. However, if we count how many churches and mosques have been restored and rebuilt in the whole country, it would seem that impossible has been done. There are hundreds, thousands of them, signifying the rebirth of our traditional faiths and religions.

There's one more thing to add. Surely, we are all different. In Russia, however, different confessions have always lived side by side. They have intermingled and have always shown respect for one another.

As for Slavs living in the Caucasus, we believe they must respect local culture, customs and traditions. The same thing is expected of all people living in Moscow, for example. They must respect the Russian people's culture and traditions. Law enforcement agencies must react promptly and effectively to all violations of the law, no matter who is the perpetrator, and crack down on crime, without any cowardice or weakness, and regardless of the [perpetrator's] nationality or religion. We must all be equal before the law.

T. Remezova: It seems to me the Russian Orthodox Christian Academy has something to say about this, too.

Remark: Hello! As it has been said, all human relations, including interethnic relations, must be based on respect for all people and for all Christians, as Orthodox Christians believe.

The foundation of this respect is love for one's neighbours, and we Christians love our neighbours regardless of their religion or nationality. This is what's most important.

Vladimir Putin: I have nothing to add, I agree with you. And I've spoken about this before.

The best example of interaction between different religions and ethnic groups is provided by the hierarchs of the Russian Orthodox Church, the Muslim and Jewish leaders, as well as religions leaders of other traditional confessions in Russia. Look at them: they build truly brotherly relations, support each other and help each other. I've been observing this for years, and I think this is the best example to emulate.

Ernest Mackevicius: And so we're moving right along the map of Russia. Next is Krasnoyarsk, the Bobrovy Log skiing complex where young skiers are training for the Sochi Olympics.

Our special correspondent Dmitry Petrov is there at the bottom of a slope.

Good afternoon, Dmitry. Actually, it's already evening there, so good evening.

Dmitri Petrov: Good evening, Mr Putin.

Good evening, colleagues.

Hello from Krasnoyarsk. Just a couple of days ago, it was minus 40 C here, now it's a bit warmer and the locals have come out to enjoy the nature and this beautiful mountain.

Many professional skiers praise Bobrovy Log as the best skiing complex in Russia. Amateur skiers can practice here side by side with professionals. There is also a sports school for Olympic backups here. Competitions between our youngest athletes, between the ages of 9 and 10, wrapped up here just a few minutes ago. As for us, we've been here for several days now. We talked with young athletes and asked them about their concerns.

Today, they have the opportunity to ask the prime minister their questions. So, without further ado, I'll let them speak. Vitaly here wants to ask something. And, as I understand it, he's actually met Mr Putin before. Vitaly, go head.

Vitaly: Hello, Mr Putin. My name is Vitaly. I am a Master of Sport in skiing. I am a graduate of the Valentin Makhov Alpine Skiing School. We did some skiing together in Baikalsk in 2002. I have a photo from the day as a memento. I hope you remember me.

Vladimir Putin: I do indeed.

Vitaly: You had planned to visit our complex twice, but you were unable to come in the end. We hope you will be able to visit us soon. We would be pleased to have you and to ski together. That was my first question.

And now for my second question. I would like to know if more complexes like this one are going to be built in the country. When and where? This complex gives a great edge to skiers and snowboarders in Krasnoyarsk and the Krasnoyarsk Territory. Thank you.

Vladimir Putin: Thank you for the invitation, Vitaly. What's the temperature over there?

Vitaly: Just minus six. The cold has let up. It's quite comfortable, good for skiing.

Vladimir Putin: Minus six is a great temperature for skiing, that's for sure.

Thank you for the invitation. I'll try my best to make it out there, especially since the governor has invited me twice. Unfortunately, I couldn't make it due to various circumstances. But I'll try to come. I have not seen that slope, and I would like to try it out. Regarding the construction of ski slopes and other sport facilities across the country, we have a federal programme guiding preparations for the Olympic Games. Training centres will be scattered all over the country, and the necessary funding is being provided. But that still does not cover all the needs.

I would like to note ­ and being a Master of Sport you surely know this already ­ that construction is taking place all over Russia, wherever such facilities can be built. In Altai, Siberia, the Urals, the Far East and of course in the Caucasus. This is being done at the regional, local and corporate levels. Our large and even medium-sized companies have built many such slopes.

We will do all we can to promote this process. I hope the process will start to snowball. I think that's an appropriate metaphor. It will be a good snowball by the end, and we will have good places to ski.

Ernest Mackevicius: Dmitry, more questions from Bobrovy Log, please.

Dmitry Petrov: Yes, a girl with a rare and beautiful name, Yaroslava, would like to ask a question.

Yaroslava: Hello, I would like to ask you how preparations for the Sochi Winter Olympics are going? We see on television that the facilities are being built, but what about the training of athletes?

Vladimir Putin: I hope that our performance at the 2012 summer Olympics in London and especially at the Sochi Olympics will not be a cause for "Yaroslavna's lament," but rather for cheers for our national team.

Training is proceeding in several ways. First, we have formed three teams in every sport: the main team, the second-string team and the youth team. The necessary funds have been provided for all these teams. Next year 2.5 billion roubles will be spent on bio-medical support, over ten times more than this year ­ not ten percent, but ten times more. This year the sum is 140 or 150 million, and next year it will be 2.5 billion. We will pay due attention to preparing coaches and trainers and to bio-medical support.

As I said, a large number of training centres for our national teams is being built all over the country, and we will increase the number of such facilities. All the more so since many of them, especially in Srednegorye, were lost after the collapse of the Soviet Union. Many of these centres are now in Georgia and Armenia. We have next to nothing. But we will make up for it in the near term.

I hope that our team will make a good showing in London and a very good showing in Sochi in 2014.

Ernest Mackevicius: Thank you, Krasnoyarsk. Thank you, Dmitry. We hate to keep you out in the cold weather for a long time, even if it's not very cold. Sport is a major topic in our studio, especially in the section Maria Morgun is in.

aria Morgun: Yes, we have many people from Kazan here. Let me remind you that this city will host the Universiade (Student Games) in 2013 and some World Cup matches in 2018. Let's hear from some locals.Your question, please.

Miroslav Makhnev: Good afternoon, Mr Putin.

I am a student at Kazan State Technical University. There conversation here has focused on the Olympics and the upcoming World Cup, but in the meantime mass sport has been somewhat neglected. Sport begins at the playground, the school and neighbourhood courtyards. Everybody knows what the situation is like there.

In Zurich recently you urged major corporations to pool their resources to finance the building of stadiums for the World Cup. This leads me to my question and perhaps a suggestion: perhaps our oligarchs dole out some money to restore courtyards to make our cities more attractive.

Vladimir Putin: Look what beautiful names our young people have: Yaroslavna, and now Miroslav, we our going back to the old Russian tradition. Miroslav, your proposal is worth considering. I think it will go over very well with the people you describe as "oligarchs." Anyway, you have raised a very important issue. Mass sport is the foundation for professional and international sport, there is no doubt about it. More and more people in our country go in for sports, I think there are about 21-23 million people now, but that is not enough. In Europe, Finland is the undisputed leader with 80 % of its adult population engaged in sport. The Finns, our neighbours, are setting a good example for us.

This will, of course, require better infrastructure. It must be acknowledged that sport schools and neighbourhood sport require particular attention today. This is, first and foremost, the responsibility of the municipal and regional authorities, but we at the federal level will continue to build up our efforts. You must have heard about United Russia's programme "1000 Physical Fitness and Health Centres." All this is to take place in the regions. The party has now come up with another programme to build swimming pools. Good projects and new technologies have been found. We will build 500 football pitches all over the country. Construction is already under way. Children will be able to play football all year round. Modern turf. We will have them at schools.

The Leather Ball and Golden Puck championships are being revived. Competitions are being held, and we will promote competitions between schools, which I think is very important. So, it is going to be a multi-pronged effort.

As for harnessing big business to contribute to these efforts as philanthropy, we would not object if someone were to pitch in to help solve these problems, but when I spoke about bringing in big business to build major facilities like football fields I assumed that such projects can and must be good business projects. Granted, they do not bring quick and massive returns like the coal, steel, gas or oil industries, but still these investments can and must be recouped.

Look at the club system in Europe and the United States. These are lucrative enterprises. Of course, given the economic crisis many of them are asking for support now. That is clear. But under normal economic conditions, in a normal economic situation, these are sound business projects. All the T-shirts, souvenirs, tickets and broadcasts make such projects economically feasible and profitable, and of course businesses can and should be interested in investing. Everything related to mass sport is the duty of the municipal, regional and federal authorities. The state should not shirk its duties and pass them on to somebody else.

Ernest Mackevicius: With your permission, Mr Putin, we have just received a question that is not exactly about sport, quite an unsportsmanlike question in fact: Why was Luzhkov sacked?

Vladimir Putin: I don't know. Perhaps for unsportsmanlike conduct? This question should not be addressed to me.

Ernest Mackevicius: Could you explain please?

Vladimir Putin: I have already explained it. The decision was made over the conflict that arose between the Moscow mayor and the president. Again, in the current power structure, governors answer directly to the president, they are his subordinates. All governors should work to build an appropriate relationship with their superior.

Ernest Mackevicius: I see. And we have received another text message. "Don't you think the new Moscow mayor and your former deputy, Sergei Sobyanin, is being a bit too tough?"

Vladimir Putin: He is not being tough, he is putting the place in order. "A new broom sweeps like new," as the popular saying goes.

I am not in on the details, and I cannot comment on all the new governor's actions. But I have known Sergey Sobyanin for many years. I picked him to be my chief of staff when I was president, and he worked with me for several years in that position. I was the one who offered him the job. I was not previously acquainted with him. He has no connection to Petersburg, which is my native city ­ a lot is being made of this fact. And he has no connections to the security establishment, in which I used to work ­ another popular topic of discussion. He was one of the more able regional leaders, an able governor. When I picked him as my chief of staff I looked at his track record and chose him for objective reasons, on the basis of his qualities as a leader and a person.

He is an experienced man, he has worked on the Federation Council, been the head of a region, an effective head, and he was a good chief of staff. He has experience working both at the regional and national levels. I trust him. He is a decent and competent man ­ just the man to be the head of the Russian capital.

Ernest Mackevicius: We have received an important and topical question. Let me read it. Galina Artamonova writes from Togliatti: "I run a tiny shop. My three employees and I, one of whom is a mother of several children and another a single mother, have been working together for six years. Everything is honest and above board. We pay our taxes and our utilities like we are supposed to. We are not exactly rich, but we do not sponge off the state by claiming unemployment benefits, and we have lived through some lean times caused by the problems at the VAZ plant. The 2.4 increase in the social tax will finish us off. It will create four more job seekers at the labour exchange and lose the state four taxpayers."

Vladimir Putin: It's a tough and complicated question, but a legitimate one. It is true that there are plans to raise the Consolidated Social Tax from 14 to 34%. That is a major step, a big leap, and a serious burden on businesses, a small business in this case.

I'd like to draw your attention to the fact that we had planned to do this in early 2010, but we decided to raise taxes in early 2011. Why did we even plan to do this after all?

We have identified major projects to reform the pension and healthcare systems. I have already mentioned this, and you know about it. Pensions were raised by 44.9% this year. Some major healthcare expenses are planned for next year, the highest in modern Russian history. The healthcare system is to receive 460 billion roubles in the next two years. Naturally, funding doesn't appear out of thin air. We were forced to raise the tax burden on this sector in terms of the social tax.

We haven't raised taxes on the entire business community. We have even singled out small and medium-sized businesses and charged 26% tax, rather than the maximum 34%, tax. This concerns innovative business, all manufacturing businesses and all companies working in social services.

What small businesses are involved? Those small businesses operating in real estate, trade and securities will have to pay much higher taxes.

I'm very sorry about this, but we simply have no choice. We will either continue to raise pensions and modernise the healthcare system or retain minimal tax burdens on businesses engaged in trade. But we have no intention of undermining this type of business, which is also very important. Consequently, we will have to ease this tax burden by eliminating corruption and the still serious administrative barriers. On the whole, analysts estimate that these accounts for about 6% of the entire tax burden in terms of money. This is the first thing.

Second. We will have to create the best possible incentives for enhancing competition, so that it's possible to import new equipment and to introduce it as quickly and efficiently as possible. For this purpose, we will have to scale down import duties on equipment needed for this activity, etc. We will do all this. Surely, we will consider other possible options for supporting all small and medium-sized businesses. I repeat that this is a necessary measure.

Ernest Mackevicius: When you prepared for this programme and looked through the questions being received at the call centre, you noted that healthcare, social development and social security remain the most relevant to our people, and the most emotional for them. I'll let our commentator Ilya Kanavin speak; he is now at the Federal Centre for Traumatology, Orthopedics and Endoprosthesis in Cheboksary, the capital of Chuvashia.

Good afternoon, Ilya. We are waiting for questions from medical professionals.

Ilya Kanavin: Good afternoon, Ernest.

Good afternoon, Mr Putin.

Good afternoon, Moscow.

We are speaking from at the Centre for Traumatology, Orthopedics and Endoprosthesis. People have their joints replaced here as a result of extremely expensive and high-tech operations. This centre is an ultramodern clinic that gets patients from half of the regions in Russia, those located between Kaliningrad and Vorkuta. People often come to the centre disabled and in wheelchairs and then end up walking away on their own. This clinic is exemplary in all respects.

I had never seen such good equipment before, maybe only on TV. Most importantly, the centre employs people who have come here to take advantage of the professional experience that can only be obtained here. More often than not, the people working here are very young and experienced.

The head physician here is only 35 years old. I think he should be able to ask a question. Please.

N. Nikolayev: Good afternoon, Mr Putin.

I'm the head of this wonderful centre built under the national project Health. Our inpatient clinic currently treats patients from 16 Russian regions. We have already performed 4,000 high-tech operations, but we could do 6,000 or even 7,000 operations.

We would like to know whether the government will continue to provide financial support for such medical centres and whether it will be possible to provide such unique, expensive and high-tech aid to as many patients as possible. At the same time, all our patients are treated out of federal funding and, of course, absolutely free of charge.

We would be able to work more effectively if aftercare and early-rehabilitation facilities were constructed near this excellent centre. This would reduce the recovery period following surgery. Consequently, the number of disabled people in the country would annually shrink by several thousand.

Thank you.

Vladimir Putin: I have already spoken on this issue. I will remind you that when we decided to build high-tech medical centres in Russian regions, an overwhelming majority of Russian medical specialists working in Moscow and St. Petersburg tried to dissuade us from doing this. They said nothing would come of it because Russian regions lacked the necessary human resources and material-technical base and that no one would go there. They said the capacity of operational centres in Moscow and St. Petersburg, as well as those in two other major Russian cities, had to be increased.

Nonetheless, we decided to establish such regional centres. Practical experience shows that this was the right move. It turns out that experienced specialists in Moscow, St. Petersburg and Novosibirsk are ready to relocate to smaller regional centres in order to reach their full professional potential because these are truly high-tech medical centres.

It is hardly surprising that the latest speaker noted that he had previously seen the kind of equipment used at the Cheboksary centre only on TV. Quite possibly, he didn't see some of these systems on TV because even Western clinics in Europe and the United States still lack some of these technological developments. All the most modern equipment is purchased and installed there.

Accordingly, the experienced but still young specialists find it a professional challenge to operate such equipment. An overwhelming majority, or virtually all, of the specialists manage to deal with this challenge after beginning to work at these centres. And I would like to congratulate you all on this.

We plan to build 14 such centres, including a children's cancer and hematology centre in Moscow. But this is a special case because this will become the largest clinic in Europe. It is safe to say that this will be the largest clinic and scientific centre. There will be 14 regional centres, including your centre and the Moscow centre, as well as nearly 20 perinatal centres, which are also essentially high-tech medical centres.

But before we speak about upgrading medical centres we need to build them, which will also require considerable funding. And you should also factor in inflation, even though it is relatively low in Russia. This year it is expected to stand somewhere between 8.5% and 8.8%; last year it was 8.8%. This year it will be 8.5%... This is the lowest inflation rate in the history of modern Russia ­ it is the historical minimum.

In any case, this will require massive funding. Construction of a medical facility, say, a rehabilitation centre, is quite an expensive project. As you know, the Ministry of Healthcare currently uses the existing network of spas for rehabilitation, but given that new standards will be introduced in the industry though the long-term modernisation programme, the ministry will need to build new rehabilitation centres over the next two or three years. We will certainly fulfil these commitments. And we will certainly continue to provide support for existing centres, building new facilities as planned and expanding the federal order on conducting high-tech operations.

Ernest Mackevicius: If I understand correctly, Maria Sittel has questions on this subject from TV viewers.

Maria Sittel: Yes, Ernest, thank you for giving me the floor at this point. It is very important since we have received many questions about health care, and I'd like to relay one of them. It differs in tone from the previous question from the centre for traumatology and orthopedics in Cheboksary, but Russia is a big country and the situation varies from region to region. So, Ivanovo, please. A cardiologist from Ivanovo, your question, please.

Question: Hello, Mr Prime Minister, in November you were on a working visit to our town to estimate the progress made on the modernisation of our healthcare system. Honestly, I think our authorities outdid themselves in putting on a show for your visit. They rushed to prepare the hospitals for your visit. They provided temporary equipment to the hospitals, for example the region's main hospital, only to remove it shortly after your visit. They made nurses tell you that their monthly salaries were 12,000 roubles and that doctors received cheques for 30,000 roubles. But it's all false. Our salaries aren't that high. My salary is 3,650 roubles, lower than the subsistence level. I have to work two and a half shifts, for which I get 14,000 roubles. Senior nurses get a maximum of 5,000 roubles.

What you saw in the wards also has little to do with the real situation. Most of the patients were asked to leave the hospital on the day of your visit, and in some wards the patients were disguised as members of the hospital's staff. As I understand it, you were shown that everything is going as planned and that the money is being used properly. Can you comment on this please? (Applause.)

Vladimir Putin: I can't understand why you are applauding. Because of the cunning of the local authorities or because of the doctor's audacity? Excuse me, you didn't introduce yourself... Well, yes, I was in Ivanovo. Governor Mikhail Men is a very experienced leader, a very good one. I'm surprised to hear what you're saying. I can't see the need for these hasty preparations. We announced our visit beforehand. We didn't really have to go to that particular hospital... Well, as I know, one part of the hospital's building has been renovated, and there is the other part they haven't gotten to yet, but it is on the renovation plan. The governor told me which part was renovated and which would be renovated later.

But if you are saying that some equipment was installed in this renovated part of the building and then it was dismantled and removed, this issue needs to be investigated by the supervising authorities. We will certainly look into this.

This also applies to salaries, in particular the salaries of mid-level medical personnel. As you know, several years ago we began funding the salaries for medical personnel of primary care hospitals, raising nurses' salaries to 10,000 roubles. Maybe this is not a primary care hospital, but in any case if salaries are this high at those hospitals, local authorities should have raised salaries at the region's main hospital to the same level long ago.

Again, if they really did what you've just told us about, I have no idea why. I didn't have to go to this hospital. We could have chosen any other hospital or clinic that the governor named. Anyway, I should say that the federal government allotted some 130 million roubles to this hospital, and we will certainly verify how this money was spent, I promise. Next week a commission of the Ministry of Healthcare will be sent to the Ivanovo Region.

Ernest Mackevicius: Cheboksary, we can take one more question from you. Ilya, please.

Ilya Kanavin: Good afternoon again. I'd like to say that no one was disguised as a doctor; we talked to people that really received medical treatment here. It would be impossible to deceive us this way.

We spent a lot of time talking to patients. It's understood that they have found themselves at this centre for unpleasant, sometimes terrible, reasons. Everyone has a story to tell and everyone has questions. I think we should hear from a patient of this centre, who has a story to tell. Please.

Yaroslav Blazhko: Good afternoon, Mr Prime Minister. My name is Yaroslav Blazhko, I am from the town of Vorkuta in the Komi Republic. I ended up here as a result of a medical error. I had it corrected at this centre, and now I have a new shoulder joint implant. Tomorrow I am signing out and going home. I don't think I have ever seen medical treatment of this quality before. The positive effects of high-tech medical treatment or a costly operation should be maintained, which is impossible in the regions since the average level of Russian health care compromises the effects of even the most advanced medical technology. This centre is excellent, but, alas, one centre cannot change the situation in the country as a whole. Thank you.

Vladimir Putin: One centre cannot change it, but if we create 14 such centres and 20 prenatal centres across the country, it will make a difference.

We are speaking about Cheboksary. Previously, to have this operation, one had to go to Moscow, the Turner Institute in St Petersburg or to another country. And now one can have this operation in Cheboksary. This changes the situation. The centre receives patients from 18 regions.

Yes, maybe this is not enough, but I repeat that this is just the first step. We will continue to move this way, expanding the federal order to introduce a rehabilitation system over the next stage of the reform of the healthcare system, which I have mentioned. This will be our next step. We cannot do everything overnight. But we are moving in the right direction.

If you think that you have received high-quality medical treatment, we will do our best to make it even stronger. This is the main mission of the reform of the Russian healthcare system. I have spoken about this. We have really ambitious plans.

I'd like to emphasise that almost all regions are drafting modernisation programmes for local healthcare systems. This will have an impact on the federal healthcare system since all standards will need to be changed. New regulations will set forth salaries for specialists, and doctors are well aware of that. I have mentioned that we have raised salaries at primary care hospitals and clinics. Through this comprehensive reform, we will also raise salaries for specialists, and I expect that it will result in an improvement in the quality of services provided to each patient in Russia.

Ernest Mackevicius: Thank you, Cheboksary.

Thank you, Ilya.

Back to our Moscow studio. Let's talk some more about health care, as there are more medical questions for you. Go ahead, Maria.

Maria Morgun: Yes, we have a question related to health care.

Yevgenia Milei: Good afternoon, Mr Putin.

Vladimir Putin: Good afternoon.

Yevgenia Milei: My name is Yevgenia Milei, and I work at an oil research centre in Tyumen. I have been disabled since childhood: I have cerebral palsy. I have been dealing with this problem for 25 years, constantly facing problems and seeking medical help. Well, even finding a specialist and getting a consultation locally is a problem, although there are rehabilitation centres in the region.

Documents are another major problem. Before the age of 18, I was entitled to a small disability benefit, but my certificate had to be renewed every year by a disability commission. You can't imagine how humiliating it is to go and collect all the documents necessary to prove once again that you are disabled, just to be able to get meager benefits. I won't even mention the period during which I wasn't getting any benefits at all.

Another big problem is education, especially going to a university. But in fact, even our preschools do not have special amenities for children with cerebral palsy. These children have severe motor limitations, but apart from that, most of them are very smart. Yet, they cannot go to school or to college.

I was lucky and stubborn too, pushing against the limits that were before me. Now that I have a good job, I have a few more opportunities to continue treatment. I just heard about the Cheboksary centre for the first time, and my question is about the future of people with cerebral palsy. Will there be a social adaptation and rehabilitation programme for them?

Based on my own experiences, I think it's good that we have Cheboksary, but I hate to admit that people, and children, will probably have to wait years before they can go there. Thank you very much. (Applause)

Vladimir Putin: First. I am happy to hear that, despite your health problems, you have a strong character that helps you overcome obstacles and deal with challenges. I remember meeting you in Tyumen.

But the problem you just mentioned is certainly sensitive for a lot of people with special needs. I will admit, well, it's no secret that the problems of the disabled have never been a top government priority, even during the Soviet era. To be honest, they were hardly ever addressed. Society preferred to ignore people with disabilities, as if they didn't exist.

I think you'd agree that in the past few years, we have not only begun discussing it openly, but we've also started to take action toward solving these problems. Special centres are being set up which offer jobs to people with disabilities. I visited one of these centres with former Moscow Mayor Yuri Luzhkov, one that effectively employs people with impaired vision. There are more of those, and still more are being established. They solve a very painful problem ­ they create these special jobs.

We will be taking other measures for this purpose, improving the legislation and providing incentives to businesses that employ people with disabilities. This year we offered businesses compensation of 30,000 roubles for each job like this, and we will raise it to 50,000 roubles next year.

There are other state programmes aimed at creating disability-accessible environments. You must have heard about them. They involve a lot of work toward adjusting the existing urban infrastructure for people with disabilities, such as installing ramps and redesigning public transport. Some things are easier to do, especially if the facility is being newly built, it's quite cheap now with the new construction standards. Other things are more expensive and require additional investment. New transport standards need to be introduced. And this is being done, gradually. We will continue working toward making significant improvements in this area.

We are certainly proud of our athletes, our national teams comprised of people with disabilities ­ this is no exaggeration. When you watch them perform ­ the paralympic athletes ­ you may be astonished. They are able to perform at a level that many people without disabilities can't achieve.

We will continue to make progress on this, and we will try to help people with disabilities feel well-adjusted and successful in life and in sports.

As for medical services, Yevgenia ­ you just mentioned that people will have to wait years. But there were no such centres before. You will see long lines at the centres in Moscow, St Petersburg, or Novosibirsk. We are building more centres now. I have just said, in response to a question from one of the patients, that we will carry this programme through to the end, and we will take further steps to modernise our healthcare system for the sake of rehabilitation treatment.

I said that we are raising the unified social tax now ­ you can see the pained reaction from businesses ­ with the sole purpose of concentrating resources for modernising our healthcare system, including rehabilitation treatment. We will absolutely do that.

The young woman over there has raised her hand many times. Sorry, Ernest ­ she's right in front of you.

Aliya Ismagilova: Hello, Mr Putin. My name is Aliya Ismagilova; I'm from the Siberian Federal University in Krasnoyarsk.

Mr Putin, I have a question about science and education.

As you know, the Siberian Federal University was established in 2006. It was included in a government-approved development programme, which ends in 2010.

A new development programme has been drafted through 2020. I am wondering if it will it be supported and financed. We depend on it for the development of our campus, new sport grounds, dormitories and our academic mobility. The first programme has helped us strengthen our base of materials and equipment. Now we need to our share experiences or invite professionals from other places.

Will the government finance the development programme through 2020? Thank you.

Vladimir Putin: You know that we have established seven federal universities and 29 innovative universities. The necessary funding has been allocated for this programme. We have held competitions among universities to determine their willingness and ability to modernise and introduce new programmes and teaching methodologies.

You university won in one of these competitions. We will certainly hold more of those. I hope you will do well with this, I mean not you personally, but your university, and will take part in these competitions and win again.

Ernest Mackevicius: Thank you, Mr Putin.

We have been on air for a long time.

Here is the call centre again. Let's hear about the statistics on calls and messages from Maria Sittel. Please, Maria.

Maria Sittel: Thank you.

Let me cite a few interesting figures. Women call more often than men, but the difference is not big, a mere 6%. Of all the calls, 67% came from mobile phones. Let me repeat here that you can call us toll free at 8-800-200-40-40 from your home or mobile phone.

As many as 4,000 people are trying to get through to us now; this means 120 calls per second. We have already crossed the psychologically important threshold of 2 million messages, with 2,037,529 messages as of 2:30 p.m. Moscow time. About 500,000 messages and 1.4 million calls came from mobile phones; all the other messages were sent in letters or through our website, much more than last year in fact. We've really had some record-breaking statistics this year.

Of all the issues discussed, social security issues are the most frequent, closely followed by housing and utilities problems. Work and salaries are in third place. Those are our statistics for now.

As for the disabled, I would like to tell Mr Putin and our TV audience that telephone operators with impaired vision are helping call-centre operators to handle incoming calls. This became possible due to your visit to the Telekurs specialised enterprise. There are two work stations with four operators here, while most assistants are working at the Public Business Centre for Moscow's Disabled Persons. Twenty-two operators are already working there. They have helped us a great deal this year.

Vladimir Putin: We should thank them for that.

Ernest Mackevicius: Thank you, Maria.

Let's go back to the studio.

Maria Kitayeva, please.

Maria Kitayeva: I would like to give the floor to students from Moscow. As I see it, this is a highly important and practical question of interest to many Muscovites.

Question: Good afternoon, Mr Putin.

I'm a student at the National Research Nuclear University. I'm a Muscovite and a first-time driver. One must agree that the road situation in Moscow is absolutely catastrophic. Three transport rings have recently merged into one single system. Traffic came to a standstill, and far from all drivers can stand the strain of traffic jams. The recklessness and rudeness of those who have been issued special sirens adds fuel to the fire time and time again. Sometimes there are showdowns involving firearms, baseball bats, and other weapons on the road. Mr Putin, how can we defend ourselves? People probably shouldn't be driving around with baseball bats.

Thank you very much.

Vladimir Putin: You know, the behaviour of a driver betrays his general culture. This is an indisputable fact of life. I'm talking about one's driving style and not just the showdowns you mentioned just now. Even the way a person drives sheds light on his or her cultural standards or lack thereof.

As far as crime is concerned, it has become something sinister. But all I can say here is that security agencies must toughen control over the road situation. We have introduced tougher penalties for driving under the influence (DUI), and with good results.

Since the days of Roman law, it has been known that tougher penalties become ineffective at a certain stage and do not reduce the total number of violations. But, judging by the current road situation, tougher penalties here are still required.

Ernest Mackevicius: Maria, may we have another question please?

Sergei Dronov: I'm Sergei Dronov from the Civil Defence Academy.

Mr Putin, you have already mentioned drafting a volunteer fire-brigade law today. This summer, our academy took part in putting out wildfires.

We would like to know how fire brigades and the Ministry of Civil Defence, Emergencies and Disaster Relief will coordinate their operations.

Vladimir Putin: This issue should be regulated by legislation. The law has not yet been adopted and is currently being examined by the State Duma. But I know that you have drafted it. This was the initiative of your ministry. Consequently, I proceed from the premise that you will choose an optimal method for dealing with the problems you have been assigned and for cooperating with voluntary fire brigades. The job is in high demand, and people will be happy to do it.

Incidentally, the state, public organizations, and the media should, in my opinion, pay due attention to that fact and commend those rank-and-file citizens who want to help in emergency situations and who are ready to risk their lives and health in order to do so.

I would like to take advantage of your question and thank all firefighters who put out blazes this year. You know, I have always treated them with great respect. But I saw how they worked and in what conditions. They faced scorching 40 C heat in all that gear. Everything around them was burning. They could fall through the ground. Trees were falling from above. The boys were reeling with exhaustion but continued to work.

You know, I was most impressed after talking with a young man whose father, also a firer-fighter, had perished in a blaze. I requested a meeting with him. And I asked what I could do for him. Nothing, I have everything, he replied. I asked him about his job, and he said he was a firefighter. It turned out that he was living with his married sister and virtually had a family of his own. He said he had a home. But that home had only two rooms.

I asked whether we could at least improve his housing conditions. No, everything is okay, he replied. I said we could ask local authorities to give him an apartment. That would be a bit over the top on my part, he replied. I was both pleased and surprised by his reply. I want to say that the Emergencies Ministry's personnel deserve the utmost respect. I would like to thank them for their work and to express hope that if, God forbid, we face similar problems again ­ and I'm not concerned here with the government, which still has its problems ­ we will take off our hats to these rank-and-file officers and men.

Ernest Mackevicius: Mr Putin, I have received one more text message concerning the medical subject you were discussing earlier.

"When will You stop the rise of medicine prices?" Since "you" was capitalised, I can assumed that this message is intended for you personally.

Vladimir Putin: Indeed, this problem exists, and it was especially bad last year and at the beginning of this year.

As you know, we have made several attempts to curb the rise of drug prices, and early this year we approved decisions regarding the registration of the initial price and restrictions on the retail markup.

I must admit that the problem still looms large in some regions and drugstores, but we have managed to cut the price on imported drugs by over 3% and the price on domestic drugs by 1.5%. The cut was smaller for domestic drugs because they are cheaper as it is.

Strategically, this problem can be resolved through further development of the domestic pharmaceutical industry and the localisation of high-tech pharmaceutical production facilities working in so-called new molecules and primary materials. Of course, the necessary conditions for this already exist, what with the ongoing integration of our plants with global pharmaceutical leaders.

We are currently drafting and soon expect to adopt a targeted federal programme, the first in this field, and with generous financing in the amount of more than 150 billion roubles, it should support the domestic pharmaceutical business and help boost the industry. We will also attract investment within the programme and support foreign-owned companies [in Russia]. They are now coming from Europe, Asia, and North America.

There is only one way to do it ­ we must clearly indicate that we will gradually close our market to imported medicines, while stimulating investment in the development of the national pharmaceutical industry. I hope this will produce the desired effect.

Ernest Mackevicius: More messages are incoming, but the bulk of them are addressed to the information centre where Maria Sittel is monitoring calls. Maria, please take over.

Maria Sittel: Mr Putin, I'd like to draw your attention to one more subject that we have not yet discussed today.

We have a call from Karina Debizheva in Kaliningrad. Karina, you are on air.

Karina Debizheva: Good afternoon, Mr Putin. I am Karina Debizheva, a student. I seldom fly to Moscow or other Russian cities even though I have many relatives there; travelling by rail during student holidays takes too long, and it is very expensive in summer.

As a student, I have no access to discount airfare. I'd like to fly to cities in Russia and not only in Europe, where students are given cut-rate ticket prices. Do you think preferential airfares could be introduced for Kaliningrad residents, just as they were in the Russian Far East?

Thank you.

Vladimir Putin: Yes, we could and should do so. Moreover, we had been planning to cut the airfare of Kaliningrad residents in January of next year. Young people up to 23 years old and pensioners over 60 years old will be given the same discount as residents of the Far East and several cities in Siberia ­ in particular, Norilsk.

We will do even more for Kaliningrad residents. Residents of the Russian Far East and some Siberian cities can buy cut-rate tickets only in summer, whereas the discount for Kaliningrad residents will be effective year round. Moreover, after launching the programme and considering our financial options, we may expand it to all Kaliningrad residents irrespective of age in 2012.

Maria Sittel: Mr Putin, here is a question that was sent online; it is personal, and the author most likely enjoys memoirs. Here it is: "When speaking about the recent spy scandals, you said that traitors don't live long. As we know from memoirs, the leaders of many countries signed orders to eliminate traitors abroad. The French and the Israelis did it. As head of state, did you ever have to take such decisions?"

Vladimir Putin: I don't think it was the heads of state who signed such orders, even in the past. This is the field of the security services. Back in the Soviet era and during Stalin's rule ­ this is an open secret now ­ there were special groups that also eliminated traitors, apart from fulfilling their duties as combat units. But such groups have long been out of service.

It is a fact that many security services, for example the Israeli security service, employed such methods, and it appears that not all security services have abandoned the practice to this day. But the Russian security services do not number among them.

As for traitors, they will drop dead without any assistance because... Well, take the recent spy scandal, in which a group of our undercover agents was betrayed. They were officers, you understand? And the traitor exposed his friends ­ his comrades in arms whose lives were dedicated to serving their homeland. Just imagine what it means to speak a foreign language as a native tongue, to give up one's relatives and not even be able to attend their funerals. Think about it! A person spends his life serving the homeland, and then some bastard betrays him. How can he live after that? How can he look into the eyes of his children, the swine?

No matter what gains a traitor receives for his malice, 30 silver pieces or what have you, he will never derive any pleasure from them. Spending the rest of your life in hiding, unable to talk with your near and dear ones ­ the person who chooses such a fate for himself will regret it a thousand times over.

Maria Sittel: Here is one more text message, a very interesting one. There is no signature, but you can guess who wrote it because it refers to the Belarusian leader, Lukashenko: "Why do you offend our Father? No matter what he does, you are never pleased!"

Vladimir Putin: Mother, father ­ what is this all about?

Maria Sittel: The message was probably texted by a Belarusian.

Vladimir Putin: And what exactly does he [Lukashenko] do? I don't think he is doing anything.

If this message refers to Alexander Lukashenko, I wonder why the author thinks we are offending him. Politics exists on a different plane ­ the plane of interest. It should be said that we have a great deal of respect for the Belarusian people, and everything Russia did in the past decades to provide economic and social assistance to Belarus was done in the interests of the Belarusian people, and we have gone far towards this end.

Still, I'd like to give emphasis to some of the relevant facts. Some people would question the statistics, but believe me, this is objective information. I will not speak about the past, although it is clear that by supplying energy that is worth billions of dollars at giveaway prices, we actually subsidised the economies of quite a few post-Soviet republics, including Belarus. I am not exaggerating.

What agreement have we recently reached? We have agreed that we will supply 20-21 million tonnes of tax-free crude oil to Belarus next year. The shortfall for the Russian budget will amount to approximately $5.3 billion.

At the same time, we have agreed that the export duties on oil products refined from Russian crude will be paid in full to the Russian budget because Belarusian refineries, which use Russian crude, export nearly all of their output. This will add up to about $3 billion, which cuts our budget shortfall to $2.3 billion. But our natural gas to Belarus is also supplied duty-free, which amounts to another $3 billion shortfall for out budget.

Besides, we have agreed to disregard the 1.7 million tonnes of oil produced by Belarus; we will not demand that they deduct the export duty on that oil. This arrangement may look fair, but only at first sight, because export duties on crude oil are several times larger than export duties on petrochemicals. It is clear that Belarus will export everything it refines and channel the revenues into the national budget, while getting the oil it needs for domestic consumption from Russia. But we do this deliberately to support the Belarusian economy.

Russian agricultural producers ­ I know this better than anyone else ­ are very sensitive to imports of, say, sugar, including from Belarus. What did we see over the past few years? Our friends and partners produced sugar from beetroot, exporting everything they produce to Russia while importing cane sugar to their own markets. Belarus sells 90% of its meat and from 70% to 80% of other agricultural products to Russia.

The same goes for nearly all other industries, including mechanical engineering (although Belarus sells only 40% of its engineering products to Russia) and automotive equipment. So, there are no grounds to say that Russia is not acting amicably.

In conclusion, I would like to say the following. Whatever relations we have with the Belarusian leadership ­ and there are flare-ups from time to time ­ I have never taken potshots at Belarusian leaders. So, however heated the situation has become, I must say frankly that the Belarusian leadership has set a clear course for economic integration with Russia. And this decision, naturally, deserves support and respect.

Ernest Mackevicius: Next comes the industrial Urals region. My colleague Yevgeny Rozhkov is at the Chelyabinsk Pipe Rolling Plant in Chelyabinsk.

I might have to ask Yevgeny to tell us exactly where he is currently, because what we see there doesn't fit our stereotype of the ferrous metallurgy industry.

Yevgeny Rozhkov: Good afternoon.

Rest assured that I am in Chelyabinsk at the Chelyabinsk Pipe Rolling Plant, which you, Mr Putin, compared to Disneyland when you visited it.

At this plant the walls and machines are painted in all the colours of the rainbow. All employees wear either white ­ like me ­ red or orange coats. The plant trees, as you have seen. This is, I dare say, the most modern metallurgic facility in Russia and maybe even in the world. In Russian, ferrous metallurgy is referred to as "black metallurgy" but the people working here call what they do "white metallurgy."

This plant manufactures highly reliable pipes, which can be used in permafrost and on sea beds.

This facility faced financial problems during the crisis and even had to suspend the construction of the workshop for a year. You, Mr Putin, once visited the workshop. But the government found the necessary funds, and the modernisation was completed. Currently, as you see, this is a truly beautiful and powerful facility.

We have been here for several days and we know that people have many questions. Without further ado, let's hear the questions.

Yevgeny Gas: I'm foreman of the moulding shop. Mr Putin, we commissioned the Vysota facility together. We have invested much money and built the world's best workshop for large diameter pipes, which has allowed us to meet Russia's demand for pipes. At the same time, pipe import keeps growing. My question is: What about supporting the Russian pipe industry? Will we have the job in the future if nothing changes?

Thank you.

Vladimir Putin: Mr Gas, how do you know that pipe import keeps growing? How do you know that?

Yevgeny Gas: There is a lot of information about it on the internet. There are many projects that entail purchasing pipes from abroad.

Vladimir Putin: Pipe imports continue to fall. In the past, pipe imports were necessary because the Russian pipe industry ­ and you know this as well as I do ­ could not produce the products needed for some, not all, large infrastructure projects. For example, Russian pipes were not fit for a corrosive environment ­ for the Blue Stream pipeline running along the seabed of the Black Sea and for the Nord Stream project to build a pipeline system across the seabed of the Baltic Sea.

Now we have your plant, which I wouldn't even call a plant, to be honest. When I first came there, it blew my mind, if you'll forgive the expression. I did not understand where I was. This is indeed something special ­ this white metallurgy. This is a cutting-edge facility, and its products meet all modern standards and satisfy the needs of our energy sector, our oil and natural gas companies using the pipeline network. So, whereas before we had to purchase these pipes from Germany and Japan, now we don't need to import them any longer. The question is price. Your enterprises have to make goods that are globally competitive both in quality and price.

Indeed, your facility and other metallurgical facilities ­ the Magnitogorsk Iron and Steel Works and Severstal ­ have started manufacturing products like this: high-quality large diameter pipes with the necessary thickness, materials and coating ­ exactly what is needed. But the prices also need to be appropriate so that your products can compete on the world market.

I'll let you in on a little secret. When I was trying to exert a bit of pressure on those who were making the decision on the Nord Stream project, in order to advance the interests of Russian manufacturers, their prices turned out to be significantly higher than that of their foreign counterparts.

The issue is the cost of large-scale projects, such as the Nord Stream, the South Stream, and, in the future, the Blue Stream, and our plans to develop the pipeline system in the oil sector. I sincerely hope that Russian products will have competitive prices, too.

As for pipe imports, you main competitor is the Ukrainian pipe and metallurgy industry. First, some of our financial institutions are purchasing assets in Ukrainian metallurgy, so these are no longer foreign.

Second, I will return to where I began ­ prices. Ukrainian companies offered products of the same quality at lower prices. Unlike in previous years, over 90% of domestic demand for pipes is now met by domestically made products.

If Ukraine full joins the integration process in the post-Soviet space, for example if it joins the Customs Union or enters the Common Economic Space, and if Ukraine continues to modernise properly, including with Russian investment, it will put up tougher competition. But I have no doubt that if you continue to modernise and develop as you are doing now, you will always have the competitive edge.

I want to congratulate you on the results that I saw at your facility. Simply fantastic.

Ernest Mackevicius: Thank you, Chelyabinsk. Thanks to Yevgeny Rozhkov. Now back to Moscow. I see there are people in the studio that want to comment on what they saw and heard.

Go ahead, Tatyana.

Tatyana Remezova: The question, it seems, will continue the theme of industry. There are steelworkers here: a large delegation from Norilsk Nickel, the world's leading producer of nonferrous and precious metals and one of the Russian enterprises that managed to make money in the crisis.

Who is ready to ask a question? Please, go ahead.

Yelena Tumanova: The Polar branch.

Of course, such plants leave a lasting impression. Our employer also invests a lot in the modernisation and reconstruction of our enterprise, but, sadly, there are still enterprises in Russia that use manual labour and Soviet-era equipment, as their owners are not as socially responsible as ours. This bothers me, because if other plants were to improve, we would improve even more.

Mr Putin, you have always supported business, and during the recent economic crisis you helped businesses get loans. However, you emphasised that this money is not a gift. Do they repay the money?

Vladimir Putin: This is a really important issue. We spent a lot of money to support the real economy in various ways. As for Norilsk Nickel and some other similar enterprises, we passed a special law and spent over 11 billion dollars from our foreign exchange reserves via our state bank, Vnesheconombank, to restructure the debt our large companies owed to foreign lenders.

We tried and did avoid a situation in which, as a result of a margin call (I won't go into details now and explain what it is), they found themselves in a difficult situation in their relations with foreign banks, further aggravated by a decline in capitalisation. As these are strategic assets, we did not want this to happen, and so we gave them money to pay their loans to foreign banks and allowed them to refinance their loans in state domestic banks. We spent 11.5 billion roubles on it, through Vnesheconombank. I would like to stress this. All this money was paid back to Vnesheconombank and returned to the Central Bank of Russia and the country's foreign exchange reserves ­ all the money. This is the first way we supported businesses.

By the way, Vnesheconombank not only returned money to the Central Bank of Russia, but also earned 400 million dollars from these transactions, from payments from these companies.

The second way we supported the real economy was by spending 175 billion roubles from the National Wealth Fund through Vnesheconombank to support the stock market for Russian companies, whose shares started losing value during the crisis. This could have negatively affected the economy of the entire country.

Vnesheconombank got this money and propped up the value of the shares of Russian companies listed on the stock exchange. It started buying shares and stabilised the situation. This was followed by a short period of stabilisation, after which the value of shares started rising. In order to avoid the destabilisation and collapse of the market, Vnesheconombank started selling these shares on the market (which is not a secret by now). Vnesheconombank earned 100 billion roubles from these operations. This money was distributed in the following way: 50 billion roubles were spent on large state projects, including Olympic construction in Sochi, and another 50 billion roubles were spent to lower mortgage rates. We managed to do this, on the whole: the average rate within the country is 11 percent. This is not all the money we spent on these goals, but these 50 billion roubles were spent on it.

All this money was returned back to the National Wealth Fund ahead of schedule.

Ernest Mackevicius: Now let's turn to Maria Sittel at our phone-in and text message reception centre. She has something to tell us.

Please, Maria, go ahead.

Maria Sittel: We're still working. All told, as of 15:30 [DH1] Moscow time, we have received 2,580,210 questions. For the most part, people call or send us SMS messages. Bashkortostan, Altai, Samara, and Saratov have become much more active, but Moscow is still in the lead (by the number of questions put to the prime minister).

Let us take this opportunity to address the questions of those who have managed to get through to us. Someone from Moscow is on the line.

Vitaly from Moscow: Good afternoon, Mr Prime Minister!

My question concerns the rallies of the Dissenters. They were banned and dispersed, then the new mayor took office and gave their rallies the green light. Hardly more than one thousand people gathered at the rally calling for compliance with Article 31 (of the Constitution) and your resignation. So were all previous efforts to bar these rallies worthwhile?

Vladimir Putin: You know that I did not keep track of every such event. Generally speaking, I would rather not interfere with anybody; however, as I already mentioned earlier today regarding recent events in Moscow, everyone should remain within the letter of the law. Under the Constitution, all Russian citizens have the right to demonstrations, meetings, and other public assemblies; however, while exercising this right, no one should encroach on the rights of other individuals. The local authorities may designate venues for such rallies, and those who plan to hold them should obey.

I have always said, and I want to repeat again, that the people who masterminded the demonstrations you mentioned are not trying to hold rallies ­ what they want is conflict with the authorities. They do not care about the rally per se [DH2] because such demonstrations will not catch the public eye ­ they want a conflict.

That is why I am not surprised that no sooner had the new mayor authorised such rallies than they (the organisers)came up with more demands, including marching through the streets, increasing the number of demonstrators, removing police barriers, and the right of passage to other areas [of the city]. They need a conflict. This is my view of the situation.

I would like to repeat that the government will not prevent people from voicing their opinions, including critical views of the policy pursued by the authorities; however, this should be done in compliance with the governing laws.

Maria Sittel: Let us take another call. Rostov is on the line, please join us live on the programme.

Question: Good afternoon. My name is Tatyana, and I am a resident of Rostov-on-Don.

Mr Prime Minister, I have the following question: The Ural area is still abuzz with speculation over the case of Yegor Bichkov. It turns out that people who are fighting drug addiction, even with methods such as Yegor's, are being sent to prison while those who encourage our children to start shooting up are free and getting rich. With whom does the government side?

Vladimir Putin: Of course, the government has always sympathised and will sympathise with those who suffer from drug addiction and from drug dealers ­ in general, from this type of crime. In order to deal with this problem, several years ago I transformed our tax police into a very large special-purpose service ­ it is large even compared with those existing in other countries. Back then, I thought that, as far as preventing tax violations was concerned, the Tax Office would suffice, and as for addressing such violations, it should be left to law enforcement officials. Therefore, we have restructured the entire federal service of 30,000 officials to fight drug addiction. I must tell you that they have their success stories, and I think we did the right thing by establishing this special-purpose service.

It is obvious that drug traffic, particularly from Afghanistan, is huge. It is very hard to stop this flow, taking into account poorly protected borders that Afghanistan shares with some of our other neighbours, with whom we have practically no borders at all. Still, we have to step up our efforts, and the special services must increase the effectiveness of their work.

As for the case you mentioned, as far as I know, there was a trial in which the court ruled that the sentence should be conditional and nobody was sent to prison. However, as in the previous case, when I was talking about rallies and demonstrations, I would like to say the following: Drug addiction doubtlessly has to be fought, but this should be done in compliance with the law. No one should be allowed to deprive other people of their freedom by resorting to illegal measures ­ say, putting handcuffs on them and the like ­ whatever noble objectives such people pursue.

Ernest Mackevicius: I see that someone in the studio wants to ask a question. Tatyana please introduce our guest.

Tatyana Remezova: Let us give the floor to our representatives from the agricultural business. The farm Prigorodnoye in the Tambov Region. Mr Prime Minister, you visited the farm last summer. Here is the farm's director, Anatoly Chukanov.

Mr Chukanov, you have the floor. Please keep your question short.

Anatoly Chukanov: Good afternoon, Mr Prime Minister.

The extremely hot weather this year has hit agriculture hard. Townspeople also know what it's like not only because of the heat wave they suffered from over the summer ­ now they see the price of foodstuffs rising because of the drought. I think these extreme weather conditions will continue to be felt next year. Already we do not have enough succulent feed. And our farm is large ­ 4,000 head of cattle. Therefore, the problem persists.

True, the governor of our region, Oleg Betin, compensated us with feed supplies from other regions...

Tatyana Remezova: Mr Chukanov, your question please.

Anatoly Chukanov: Yes, pardon me.

I would like to ask you the following: Aside from abnormal (economic) conditions, unequal exchange ­ namely the price disparity between agricultural and industrial goods ­ also causes major problems. In the last two months, the price of fertilisers has grown by 30-50%. That's a rise! And fertilisers are being shipped abroad.

That's why I would like to ask if a ban similar to that on grain export can be imposed on them?

Or at least, could we establish a sales quota on the domestic market allowing fertilisers to be sent abroad only when the quota is met?

And the third proposal: Can the subsidies on mineral fertilisers and plant-protecting agents be increased for agricultural producers?

Vladimir Putin: Mr Chukanov, you have asked a lot of questions, and I will try to be as brief as possible.

Of course, this field is extremely important: more than 40 million people (including family members) and thus one third of the country's population are involved in agriculture. This, as we say, is not even a field of production ­ it is a way of life; it's their fate.

Two years ago, we had a record-breaking harvest of 108 million tonnes of grain, and last year, it was 98 million. This year, it has been 60.5 million tonnes, while domestic consumption totals 75-78 million.

I would like to repeat that this amount is sufficient for domestic consumption. As you know, we have a carry-over balance of 21 million tonnes of grain and another 9.5 million tonnes secured by the intervention fund and state and federal savings. So the country was not and will not be left without grain.

As for mineral fertilisers and prices...

Incidentally, two years ago prices were quite high, and although we accumulated 108 million tonnes of grain, the greater part was shipped abroad; then last year, prices dropped. Two years ago, they reached 9,000 roubles a tonne, and last year, the price was 3,500 roubles for fodder grain and up to 4,000 roubles for bread grain. Now, it is approaching 7,000-7,500 roubles a tonne. And this, as you have correctly noted, affects the prices of food.

I signed two government orders late last evening that will be issued today. We will start distributing grain from the intervention fund. We will separately send the necessary amount of fodder grain to those regions where the livestock sector needs to be supported; bread grain will be sent to Moscow, St Petersburg, and the Leningrad and Moscow regions under a separate order. The work will start soon. I repeat that the documents were signed and will be issued today.

Yes, we will distribute about 1.3 million tonnes, while we keep 9.5 million in reserve. That is the first bit of news I would like to report to you and all of your colleagues involved in agriculture.

As for the price of mineral fertilisers, there have been a number of initiatives, including an agreement between agricultural producers and the manufacturers of mineral fertilisers on raising prices next year. Perhaps the price of mineral fertilisers will be slightly increased, by 13%, in the immediate future. The agricultural producers have consented to it. It is connected with inflation and the increasing expense of energy resources ­ petrol and so forth. But there will be no 50% or even 30%, and this claim requires additional examination.

I will undoubtedly order the execution of the current agreement because the 13% increase, I repeat, has been previously negotiated by agricultural producers and the manufacturers of mineral fertilisers. Anything above that figure falls beyond the terms of the agreement. It is unacceptable.

In terms of imposing restrictions on the export of mineral fertilisers, I would like to remind you, Mr Chukanov, and your colleagues of something that you are already aware of. I will repeat it for those who do not know: we, that is, our country's agricultural producers, consume some 12-15% [of the fertilisers in question], 20% at most. The country's industry exports the rest for sale. If we prohibit export, we will glut the domestic market with these goods and destroy these enterprises, since they sell their goods for higher prices on foreign markets.

And I will most certainly inquire as to the figure of 30-50%. The additional funds provided by Oleg Betin are for transporting the grain we need from the regions that had a good harvest, to your region in particular, and Mr Betin does his job well. He does it at our expense, since we subsidise it from the federal budget; but in general, he has excelled in using the funds so efficiently.

Ernest Mackevicius: We have been on the air for more than three and a half hours, for 3 hours, 45 minutes, to be exact.

Vladimir Putin: Incidentally, did you know that we made a decision to allocate additional funds to supporting agricultural producers with cattle livestock? Next year, we will allocate an additional 5 billion [roubles] for this purpose and another 2 billion for fertilisers and other things. In general, the support ­ I'm afraid I may mistake the figure ­ will total some 123 billion roubles. That will be the approximate scale.

Ernest Mackevicius: We're nearing the finish line actually, so I'll let Maria Sittel bring you a call-centre update. Please, Masha, go ahead.

Maria Sittel: I'll just report briefly that at this point, we've received 2,063,409 questions, including SMS messages, e-mails and phone calls. The largest share of questions comes, quite predictably, from the city of Moscow, which is followed, surprisingly, by the Krasnodar and Rostov regions. Moscow Region usually comes in second, but ranks third this year, along with Sverdlovsk Region. One other peculiarity of today's event is that the number of e-mails has grown by 50%, with more and more people selecting this mode of communication. Those are the main figures, as of now.

Ernest Mackevicius: We've been on air for slightly less than four hours. Mr Putin, when preparing for your annual phone-ins, you normally select a number of questions you'd like to address. We won't break with that tradition this time around, will we?

Vladimir Putin: No, of course not. But let us first take some questions from the audience, shall we? And then we'll be moving slowly toward the end (of our session). Please go ahead.

Remark: My name's Oksana, I'm from Chuvashia University. Mr Putin, no doubt you're a talented man...

Vladimir Putin: Thank you.

Oksana: We learned just a short while ago that you can play the piano, and you can sing, too. Is there any other talent you are hiding from the public?

Vladimir Putin: Well, that's an overstatement on your part. I can't really play the piano, but a friend once taught me to hit the keys with two fingers, and I did just that. Every person has a talent, but not everyone gets the chance to reveal it. Self-accomplishment is what I'd like to wish for every one of us. And the state will do what it can to make that happen. (Applause)

(Addressing the audience) You're a State Duma deputy, aren't you?

Reply: No, no.

Vladimir Putin: And what's that badge you're wearing?

Reply: It's a trade union badge, Mr Putin. I'm a trade unionist from Norilsk. Here's my question: How do you feel about Mr Prokhorov's initiative to change the effective labour law?

Vladimir Putin: Negatively. (Applause) We just cannot let it get through at this point. There are certain medical standards, you know, and if accepted, [the initiative] will permeate the entire system, which is absolutely inadmissible at the moment. (Applause)

A. Grekov: I'm the head of the student construction headquarters at the Urals Federal University. A federal targeted programme was signed in 2008 to support academia as part of Russia's modernisation effort. This programme envisaged the construction of university dormitories across the nation. But it has now been suspended, and allocations have stopped coming in. This is a serious concern for our university and Urals State University because our residential halls were built back in the 1930s.

Vladimir Putin: Yes, I know.

A. Grekov: It's just that (in such conditions) federal universities cannot really cope with the work they have been assigned.

And here's the second part of my question: Student building teams are ready to take up as much as they can, working for the benefit of their universities, but they face certain difficulties in this regard. Since contracts are awarded through competition, there's no way for us to get involved. How can this situation be changed, do you think?

Vladimir Putin: I see. You're referring to Law 94, under which we hold tenders for works, services, and supplies. We're considering how we could optimise the situation; we've been reflecting on it for quite a while, actually. But the issue is a tricky one, because we're dealing here with ideologically apt legislation.

We've managed at times to cut the initial price as much as 200-300% by applying this law on state purchases. But, admittedly, it has its flaws. And we should do everything possible to involve student building teams as much as possible.

Regarding university residential facilities, this is, indeed, an acute problem, even more so following the introduction of the Standardised High-School Test. I know there are lots of problems to address and that many people oppose this testing format. But I won't dwell on this issue now.

The number of non-residents enrolling in universities is, obviously, on the rise. Aspiring students can now apply more easily to major schools away from home, and the number of young people who do so has increased sharply. Which means that the problem of dormitories is becoming all the more acute. But I have to admit that we've cut down [on our allocations] in order to reduce budget spending overall.

Some foreign countries run a budget deficit of 11%, 12%, or 13%, you know. But we cannot afford such a budget. We can't expect a sympathetic donor to come and bail us out in case of an emergency. On the other hand, we shouldn't be surprised if people out there try to make our life more difficult. I can easily recall my previous discussions with the IMF. We get along quite well with them now that we've settled our bills, but the situation was different when we were in debt.

They often try to assure us that no political pressure will be brought to bear. But this isn't the case, unfortunately. And we cannot let anyone interfere with our domestic affairs; we cannot have an outsider telling us what to do in our own country. That's why we need to keep all macro-economic indicators under close scrutiny. And that's why we've had to reduce our expenditures. But of course, we will now try to revive spending whenever necessary, [specifically with regard to] the construction of dormitories.

. Kitayeva: We have some questions from Krasnodar Territory. Let's give them the floor. They have been hit hard by the elements this year.

Olga Menschikova: Tuapse District, Novomikhailovsky settlement.

Thank you very much, Mr Putin, for your attention to our situation. I would like to take this opportunity to thank you on behalf of the people living in our settlement and Tuapse District as a whole. I also want to thank our local authorities, who have been helping us from the very beginning.

I have a question regarding our recent disasters. What should be done, in your opinion, to warn the residents of flood-prone areas about such hazards as tornados?

Vladimir Putin: We need to build a state-of-the-art warning system, as we did in the Far East, that addresses hazards like tornados. We are allocating additional funds to the Ministry of Emergencies for this purpose. Such warning systems will either be upgraded from existing services or be created from scratch.

Unfortunately, it was hard to forecast this disaster. It was a unique natural phenomenon that caused a tornado to lift perhaps thousands of tonnes of water, carry it to the mountains, and then drop it against them.

Regretfully, as you know, in regions including ours and yours, settlements grew up practically on top of dry river beds. Those were their historical sites, but everything should be done now to minimise that fact's unfavourable consequences for the people.

For example, I talked to Alexander Tkachev about the school that we visited and that he was so actively restoring: it simply needs to be relocated, despite the expense. We are ready to provide funds from the federal budget.

Such targeted operations will minimise the negative consequences of further natural disasters. These problems must be solved.

It's probably time to wrap things up, or this will be endless.

Ernest Mackevicius: Well, let's come to your questions. This green file must have caught the eye of our TV viewers.

Vladimir Putin: Yes. There was a request to me to select some questions of a general nature that may be interesting to other people and not only to those who asked them.

"When will Russia have an idea worth living and working for"? ­ Galina Popova, a pensioner.

It seems to me that for you, Galina Dmitrievna, and for all of us, it has always been and always will be worth living and working for the sake of our children, our grandchildren, and our homeland, Russia. What else is there? I think that's how things stand. Whatever we recognise as the national idea, there is nothing dearer to a person than his or her family, kith and kin, and homeland. (Applause)

A question from a car owner: "As a car owner, I am concerned about road blocks. When you and other officials travel across Moscow, we, the common people, sit in traffic jams. Tell us what we should do. In any case, we need to go to work, to the airport, etc. Thank you, D.A. Volnov."

I can tell you that road blocks for special vehicles are provided for only two officials: the president and the prime minister of the Russian Federation. It is based on the need for security and special work conditions. There is no one else for whom the roads shall be blocked, and if it happens, it is a gross violation of applicable regulations.

However, in general, of course, everything associated with traffic restrictions and their inequality should be eliminated consistently and as soon as possible. This is absolutely evident.

"How is your puppy, Buffy? Good for you that you accepted a name proposed by a child. Sincerely, Pisarev".

Buffy is very well. He makes huge puddles and a mess on the floor all around the house, but despite that, he is a nice chap and I like him very much. (Applause)

"When will officials in Russia be made liable for their crimes, rather than simply resigning?"

I must tell you that the number of persons prosecuted for malfeasance ­ that is, for corruption and bribes ­ is growing for better or worse; and in several recent years, it has been growing steadily. It is not because there are more crimes ­ it is because more crimes are being exposed. I think that our focus on the extirpation of malfeasance should be preserved.

"Please congratulate me while on air on my daughter's birth. Ella Skorobogatykh of Usolye-Sibirskoye."

I and everyone present here heartily congratulate you on this great event! (Applause)

"If it were possible to anonymously accuse corrupt officials, you would have known everything a long time ago."

Indeed, it is possible to inform on anything, even more so when it is done anonymously. What can be said about it? Law enforcement bodies react to the information they are given, but we cannot and should not revive the atmosphere of the 1930s, when anonymous information served as sufficient ground for immediate imprisonment.

"When will theft become a thing of the past in Russia?"

I'd prefer not to answer this one. Let me just say that each and every one of us should work towards solving this truly challenging problem. One cannot help wondering, though, whether there's ever been a time when theft did not exist and whether in today's world, there is any single community immune to it.

It's a matter of scale, of course. Admittedly, the healthier the community, the fewer cases of theft it faces. Even in this country, there are areas out there, in Siberia, where theft is almost unheard-of to this day and where people can leave their houses without bothering to lock the door.

That's a serious one, you know. I won't read out the whole message. It's about high-speed trains. We've recently launched the Sapsan train [between Moscow and St Petersburg, and Moscow and Nizhny Novgorod], but people living in the suburbs now find it harder to commute to work because express trains [like the Sapsan] don't stop at smaller stations, and the number of regular suburban trains has been in decline.

I won't read the whole story to you. The problem is evident. I'll just emphasise once again to the top management at Russian Railways, Inc.: we mustn't try to create better conditions for some at the expense of others.

"Don't you feel ashamed?"

No, I'm not.

I have to admit that many things could be done in a better and more effective fashion, if only in terms of economic expediency. During the recent global economic downturn, for instance, we should have tried to better protect our economic security by taking a tougher line on the devaluation of the national currency. We shouldn't have waited for international financial institutions to take advantage of the situation by helping themselves to a slice of our gold reserve pie. They knew we would take certain measures, and they preempted us with certain manipulations of the market.

So that's something we should have done out of economic expediency, but it would have come as a shock to the public, similar to what they experienced back in 1998 when they woke up to see all their savings evaporated. And in order to make it possible for people to adjust to their changing circumstances, we did just what we promised and steered clear of shock therapy. Many things could have been done differently, and the effects would not have been the same.

"When will stand-up comedians stop cracking jokes about mothers-in-law? It is a sign of disrespect towards the elderly, and women in particular. It's all about discrimination." Here, only a phone number is indicated.

I totally agree with you. And I should apologise to you because I, too, happen to recount anecdotes of that kind.

The response reads "Thanks..." followed by words of appreciation. Oh, well, thank you for being so appreciative.

"Mr Putin, we have a once-in-a-year chance to put some question to you. Could you please arrange for this [phone-in] to be held at least twice a year? Best, Natalia Chernova."

We rely on many different communication formats because I tour the country extensively. We've now begun to hold regular events within the framework of the United Russia party across federal districts. Also, special centres for addressing public complaints are being set up (across the country). As for phone-ins, I believe once a year is just the right frequency for this kind of format because it gives us a chance to review the results of the outgoing year.

"What about people who wait for a reply from the president and the prime minister for years or have no opportunity whatsoever to get through to them? What are such people supposed to do, especially if they have to cope with problems that are much more serious than those usually voiced during phone-in sessions?"

Perhaps, I should have answered this question at the very start of our conversation. But let me say something on that score now that we're drawing to a close.

You know, despite all the formats I mentioned just now, including the centres for public complaints, or my regional tours and meetings with the local public, or phone-ins like the one we're having today, it is unfortunately just unrealistic for every person in need of help and support to get through to the prime minister or the president. But I expect our counterparts in regions and municipalities to try as hard as we do, or maybe harder, (to address public needs).

As a matter of fact, most of the problems people face on a day-to-day level lie within the jurisdiction of local and regional authorities.

Also, when we cast our ballots, we should think twice about whom we are voting for. I'm referring particularly to the municipal level, at which problems related to the housing & utilities sector, healthcare, and education should be addressed.

We should think whom we are electing. Not just some windbag who promises a Garden of Eden, but people who may not be very colourful, but who know their business and thus create a normal system of government that can address people's pressing problems. And of course, one should never give up, not under any circumstances. Zhenya here is the best example. (Applause)

A very kind message from School 39 in Makhachkala, thank you.

And another one, thank you.

I won't read them, but they are important to me and I am glad to receive them.

True, they praise my vocal abilities, obviously exaggerating, but thanks anyway.

"Promise that World Cup Football will be organised at the highest level."

"I promise." (Applause)

"We small businessmen think it is high time to restore order in this country..." And they go on to claim that I am the man who can do it.

I will try; my word of honour.

"Why do you raise pensions every year thus provoking overall price increases?"

A serious question, and obviously the questioner is of the liberal economic persuasion. It is true that in modern economic theory, and practice for that matter, as we see in many European countries, in time of crisis, declining production, falling prices for traditional export products, for example, it is impracticable and even harmful to raise wages, social benefits and all sorts of government payments.

But there you are; we see what is happening in European countries. Far from raising wages and benefits, they are steadily cutting them. Direct cuts in wages and social benefits, including pensions.

The thinking is that by increasing public spending, we spur inflation and create a vicious circle which prevents the economy from coming out of its crisis and then brings stagnation. That is certainly true of traditional market economies. Our economy is a transition economy.

This is what I would like to say to people who advocate such an approach. First, our citizens, unlike those in developed economies, have no private savings.

I had on-the-job practice at a European bank when I worked in St Petersburg. When we went there (it was in Germany) we were shown the accounts of pensioners at a major bank. Each of them had 300,000-400,000-500,000 DM in their account in addition to their pensions. They had something stashed away for a rainy day. Our people do not have such money. The state cannot, in a crisis, leave these people at the mercy of fortune. That is one point.

Secondly, our actions are not destroying the macroeconomic indicators. I have said that this year inflation in this country is at an all-time low, 8.5%. It always used to be at two digits. We consistently set lower and lower inflation targets. We will continue to do so.

However, as you may have noticed, questions were asked here about student grants. Similarly, although this was not articulated, I am aware of the serious issue of the indexation of public-sector wages. We are trying, in a quiet way, to hold things back, but we cannot totally wind up state support for those who need support. I think it would be wrong from the social and even from the economic point of view, because by raising pensions we raise the purchasing power of the population. And pensioners tend to buy domestically made products.

"You said, 'corruption and bribe-taking should be punished by hanging.' So, go ahead, pass a law and hang them." But you did not hear my sentence to the end, I said, "this is not our approach."

The city of Roslavl, Yelena Anufriyevna. This is not a question, but a plea, "I want justice." We all want justice.

"Come visit some region without warning, at least once. That would be a real show, real drama."

I have repeatedly visited regions without warning and will continue to do so. It has happened many times, and it will happen again.

"Good day, I would like to know the following. The state holds the Year of the Family, the Year of Youth and so on, but does the state plan any system of support for the disabled?"

I have talked about this. I spoke about the barrier-free environment programme, the development of paraplegic sports, etc. Such programmes exist and we will pursue them.

"In the past I was ashamed of my country's leaders. Thank you for ridding us of that shame."

We will try to do our best in the future.

"Esteemed Mr Putin, do you think the election of regional governors in the Russian Federation should be restored?"

I had the chance to speak about this today. I think we have chosen the optimum way of bringing regional heads to power, the way that best suits our country: the president submits a candidate, and the deputies of the local parliament, who are accountable to the local citizens, can vote for or against the candidate proposed by the president.

By the way, I was once faced with this situation. True, I did not wait for the parliament deputies to vote against my candidate, but I had to back off from offering the candidate who clearly had no chance of winning the vote. On the whole this process, this method of bringing regional leaders to authority is workable. On the one hand, it takes into account the interests of the federal centre and the united Russian state, and on the other hand it is sensitive enough to regional demands while protecting the process from criminal pressure.

"What do Nemtsov, Ryzhkov, Milov and others of their ilk want, after all?"

Money and power, what else? They had a field day in their time, in the 1990s when, together with the Berezovskys and those who are now in jail and whom we recalled today, stole billions. They were dragged away from the feeding trough, they have spent much of their money and they want to come back and refill their pockets. But I think if we allow them to do so, they will not stop at billions, they will sell all Russia down the river.

There is a question about agriculture, but we have already discussed that topic.

Now, there are many questions from Japan. I don't know why from Japan, but they ask about the islands, Japanese food and judo. I am fond of judo and Japanese food, but I would like to draw the line there.

"Are you a shaman or something?"

No, I am not.

"Good afternoon, Mr Putin. Why do petrol prices in Russia depend on world oil prices? We are an exporting country."

Yes, we are indeed an oil exporting country but in this country like any other market economy, prices for any product depend on world prices for this product.

We have discussed grain prices with representatives from agriculture. Our domestic grain prices have reached between 7,000 and 7,500 roubles a tonne, about $200, while the grain price in the world market is over $300. Our domestic price is inevitably rising to this level even with grain exports suspended. I would like to emphasise that this is happening despite the fact that we have closed this market ­ we have suspended grain exports. We cannot suspend the export of oil or oil products. This is the main source of revenue for our budget. So, this influence is inevitable. But this is not the only reason.

For example, in the United States, taxes on the oil sector total about 15% while in Russia they total over 50%. This is where budget revenue comes from to fund social programmes, the defence industry and other programmes. So, this situation partially results from the government policy to redistribute funds for the sake of that part of the population that needs protection and in order to carry out social programmes.

"Why do we sell natural gas abroad while our villages lack a gas supply?"

We have discussed this issue many times. Our domestic natural gas pricing is more than three times lower (than that in Europe) and we cannot raise this price because our people's purchasing power is not as strong as that in Europe and because our industry has not been modernised yet to purchase natural gas at European prices. Russia's domestic price for natural gas is about $80 per 1,000 cubic metres while the European average price is $330 or even more now. Gazprom is getting along by selling natural gas abroad but also uses this money to expand Russia's gas distribution system. This programme is being carried out at a very healthy pace and we will maintain this pace.

"Mr Putin, unfortunately, we will not be able to watch you live because our daughter is getting married on December 16. She is physically challenged, second group, so we are especially happy that she is creating a family despite her disability. We will be celebrating the marriage with our family members at home. If you congratulated the newlyweds by phone it would be a wonderful gift for them. Yelena Kuzmina."

Why congratulate them by phone, we will do this on air ­ I think their celebrations are already over. Ms Kuzmina, we congratulate you and your daughter on this important event! (Applause)

"Who is governing the country when you and the Russian president are asleep?"

We take turns sleeping. (Applause)

Don't worry, everything is under control.

"What changes are in store for Russia in the near future?"

In the nearest future we will overcome the consequences of the global financial and economic crisis and will progress according to the Development Programme until 2020. We are having some plans for 2030 and 2035. I'm convinced that there is nothing in these plans that we cannot achieve if we work together, responsibly and efficiently as we have worked these past few years.

Thank you very much.

Ernest Mackevicius: Mr Putin, today you have answered many questions ­ easy and complicated, important and not so important. Summing up everything that has been said in this studio today, can you say what the year 2010 coming to a close was like?

Vladimir Putin: This year has been a difficult one. At the beginning it was hard to predict how the situation would evolve by mid-year or the year's end. Nevertheless, the measures taken helped us get the situation under control.

Issues have already been raised today, for example, related to recovering the funds that we spent on supporting the real sector. But it all began with supporting the banking sector. This move has been much criticised: where is the money? Are we doing the right thing supporting the banking sector? The banking system is the blood system of the entire economy and subsequently of the social sector. We have pumped 2.5 trillion roubles into banking. I would like to emphasise that the recoverability of these funds is 98%. The Central Bank has gained 150 billion roubles from all this and 75% of these funds have been transferred to the federal budget.

Support for the financial and real sectors, targeted social measures aimed at supporting particular social groups, the labour market ­ all this did take an effort, but the result is evident and clearly positive. Our objective for the next few years ­ a year and a half or two years ­ is to uphold this positive trend. I'm convinced that we will embark on the road of accelerated economic and social development.

Ernest Mackevicius: Thank you, Mr Putin.

Best wishes for the coming New Year.

Vladimir Putin: Thank you.

Ernest Mackevicius: This was Rossiya TV channel special programme "A Conversation with Vladimir Putin. Continued." We are looking forward to continuing this conversation next year.

Thank you, Mr Putin.

Vladimir Putin: Thank you.

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