Russian Development Update: Minister's Meeting & Economic Issues

On 7 February, Putin held a videoconference with government ministers to discuss various aspects of Russia’s ongoing development and modernization projects. Also discussed are the many additional social benefits that began at the beginning of 2024 and how these changes in the social contract are faring. The last item is Putin’s preamble to the discussion on civil aviation, although the transcript ends before the discussion by Vitaly Savelyev and Denis Manturov begins (Minister of Transport and Deputy Prime Minister for Industry and Trade of the Russian Federation, respectively). I have no explanation for that since the state of civil aviation’s been discussed fully in previous meetings. The video also ends at that point, 34 minutes into the meeting. But what’s revealed is still important information.

On the 12th, another meeting on economic issues was held that yielded a short transcript since the deeper issues to be discussed seem to be deemed classified. However, what’s revealed still provides enough information to discern Russia’s heading in the correct direction within its planning parameters. All emphasis mine:

Vladimir Putin: Dear colleagues, good afternoon.

We have already discussed several issues with the Prime Minister and some of our colleagues in the morning, and now we will talk in such a broader format and on a specific issue that is of great importance for the development of the economy and for citizens – the development of the transport industry.

But before we start, a few operational questions. And the first of them concerns the development of the Eastern Railway polygon. This also applies almost directly to what we will discuss, although we will talk more about aviation. But this is still the transport industry.

In this regard, we need to achieve an increase in traffic indicators in the Far Eastern direction. This year, they should reach 180 million tons, and by the end of 2030, they will reach 210.

But in order to solve these problems, we need to deal with a number of issues, including the electrification of the Eastern railway landfill. We have certain plans, and appropriate work is being carried out in this area. [This term “landfill” I can’t find any explanation for in the searches I’ve conducted. If one of my Russian readers can explain what that is in the comments, it would be very helpful to me and others who I’m sure are curious.]

Alexander Valentinovich [Novak], what is the current state of this work?

A. : Thanks

Dear Vladimir Vladimirovich,

As you noted, in accordance with your Decree to increase the capacity of the Baikal-Amur and Trans-Siberian railway lines to 180 million tons, the Government is implementing a large-scale program to supply electricity to the Eastern Landfill. This applies to the electrification of almost four thousand kilometers of railways.

To implement this task, it was planned to build and modernize a number of large energy facilities, which are included in the comprehensive plan for the development and expansion of the main infrastructure. They are divided into two stages.

At the first stage, which was completed at the end of last year, Rosseti built 14 large electric grid facilities. These are eight high-voltage power transmission lines with a length of 2,700 kilometers, as well as six powerful transformer substations.

At the second stage, seven more objects of backbone networks and another 2,100 kilometers of high-voltage power lines will be commissioned. All activities of the second stage in the electric grid complex will be completed this year.

At the second stage, in addition to the construction of the electric grid complex, work is underway on the construction and modernization of nine thermal power plants with a total capacity of 4.5 thousand megawatts. Construction projects are underway in the Republic of Sakha (Yakutia), Irkutsk region, Primorsky and Khabarovsk Territories. At the moment, the modernization of three power units in the Primorsky Territory with a total capacity of 440 megawatts has already been completed.

The total amount of investment in the construction and reconstruction of energy infrastructure is 1.4 trillion rubles. Of these, 440 billion rubles have already been financed, including 273 billion rubles financed from Rosseti's own funds and 167 billion rubles invested in the development of generating capacities.

For this purpose, the Government has created a special infrastructure, that is, a special mechanism for attracting and returning investment.

The construction of energy infrastructure will cover the needs of not only the Eastern Landfill and railway infrastructure, but also the socio-economic development of the regions of Siberia and the Far East, including through the creation of new jobs and new additional tax revenues to the budget.

Among other things, we are talking about creating the possibility of connecting projects in such areas as oil and gas, petrochemistry, mining, precious metals, as well as the forest industry and other industries to new capacities.

Mr. President, in conclusion, I would like to say that today Andrey Ryumin, General Director of Rosseti, is working on one of the largest electric grid facilities implemented as part of the first stage of the Eastern Test Site, the Ust-Kut – Nizhneangarskaya high-voltage line. He will tell you in detail about the completion of work on the first stage of electricity supply. If you'll excuse me, I'll give him the floor.

Vladimir Putin: Yes, of course.

Please, Andrey Valeryevich.

Alexey Ryumin: Dear Vladimir Vladimirovich,

In accordance with your instructions, Rosseti Group is implementing a large-scale project to supply electricity to the Eastern Railway landfill. This is the largest project in the power grid complex in recent decades.

Today I want to report on the completion of work on the first stage of power supply to the Eastern landfill. As part of the first stage, we have built high-voltage transformer substations with a total capacity of over three gigavolts-amperes and almost three thousand kilometers of power transmission lines. The volume of investments in the first stage amounted to more than 160 billion rubles. Measures to supply electricity to the Eastern Landfill are part of a comprehensive plan to modernize and expand the main infrastructure, and I would like to thank the Government of the Russian Federation for its assistance in implementing these measures.

Dear Vladimir Vladimirovich, the work was carried out in difficult conditions, often at extreme temperatures, the temperature reached minus 60 degrees. The entire construction was carried out far from populated areas, from roads. There were more than six thousand people and over two thousand pieces of equipment at the construction sites of the first stage.

Separately, I would like to note that we implemented this project in record time. During the construction, we applied such complex technical solutions as, for example, when crossing rivers, supports with a height of 90 meters were used. If you compare them, they are almost as high as a 30-storey building.

It is especially important that during the implementation of this project – the first stage of power supply to the Eastern Landfill – more than 90 percent of the materials and equipment used were produced in our country.

The final activities of the first stage were: the construction of the 500 kilovolt Nizhneangarskaya substation in Buryatia – this substation was among the three most powerful power centers in the Far East - as well as the construction of the 500-kilometer Ust-Kut – Nizhneangarskaya line. Just behind me, you can see the beginning of this energy transit.

Dear Vladimir Vladimirovich, all power grid facilities of the first stage of power supply to the Eastern Landfill have been put under voltage. We have already provided about 200 megawatts of additional capacity for the BAM and Trans-Siberian Railway, and the system reliability of power supply to consumers in eight regions of the Russian Federation has increased: These are Kuzbass, Khakassia, Krasnoyarsk Territory, Irkutsk Region, Buryatia, Transbaikalia, Khabarovsk Territory and Primorye.

Industrial enterprises and infrastructure facilities are also connected. Here are a number of major ones: These are the ESPO oil pipeline, Eastern Siberia-Pacific Ocean; the Sukhoi Log gold deposit; of course, the Kovykta gas field and many, many others.

I would also like to mention that the Rosseti Group is already actively building infrastructure as part of the second stage of electricity supply to the Eastern Landfill. We are going according to our schedules, and we will complete everything on time.

At the end of my report, I would like to thank, of course, the employees of the Rosseti Group, employees of contractors, builders, and designers for the successful completion of the first stage of power supply to the Eastern Landfill.

And especially, Mr President, I would like to thank you for your attention and support to the entire electric grid complex of our country.

This concludes my report. Thanks

Vladimir Putin: First of all, I congratulate you and all the specialists who have worked and continue to work in this area. This is very important work not only for the transport industry, not only for the development of railways, but also for residents of eight regions of the Far East. These are Buryatia, Khakassia, Zabaikalsky Krai, Krasnoyarsk Krai, Primorsky Krai, Khabarovsk Krai, Irkutsk and Kemerovo Regions. The work done makes it possible to increase and significantly increase the capacity and reliability of electricity supply to settlements in all these regions.

What's your current temperature, and what's the weather like?

Alexey Ryumin: It was minus 20 in the morning. Now it seems warmer, minus 15, probably somewhere like that.

Vladimir Putin: I understand that people worked in difficult conditions all the time, so thank them very much and all the best. Good luck!

Alexey Ryumin: Thank you, Mr Putin.

Vladimir Putin: Thank you very much.

Alexander Valentinovich, is everything all right?

Alexander Novak: Yes, Mr Putin. Thanks

Vladimir Putin: Thank you very much.

And a question for Anton Olegovich [Kotyakov]. Since January 1, we have additionally earned the decisions made earlier in the social sphere. This is an increase in the minimum wage by 18.5% – 19,242 rubles, a 7.5% increase in the single benefit for families with children and pregnant women, as well as an insurance pension for 31 million non-working pensioners.

Since February 1, more than 40 different payments for almost 20 million people have been indexed by 7.4 percent. This is the maternity capital for the first child, it has now become 630 thousand rubles, for the second child-833 thousand rubles.

Anton Olegovich, all this really worked, is it being implemented, payments have gone? How would you comment on everything that is happening in this area?

You are welcome.

A. : Dear Vladimir Vladimirovich,

The adopted three-year budget, in accordance with the current legislation, provides all the necessary resources for indexation of social benefits and a number of insurance payments. Today, there are two approaches to increasing the size of basic support measures.

The first is an increase in insurance pensions and payments, the amount of which is tied to the subsistence minimum, starting from January 1. So, since the beginning of the year, we have actually increased our insurance pensions by 7.5 percent, as you have already mentioned, dear Vladimir Vladimirovich, and the average amount of such an old-age pension for non-working citizens today is 23,400 rubles [~$260]. In total, the January indexation made it possible to increase pension payments to almost 31 million people.

Child benefits have also increased. Let me remind you that starting from January 1, 2023, a single allowance for children and pregnant women was introduced on your instructions. Such assistance has already been provided to parents of almost 11 million children and over 400 thousand pregnant women. For 75 percent of recipients, the maximum amount of payment is set today. And since January 1, taking into account the increase in the subsistence minimum, the amount of such payments for children in Russia has increased to 14,900 rubles on average in the country [~$165].

The second approach to indexation is to increase support measures from February 1 based on the level of actual inflation over the past year. This indexing affects a total of 40 payouts. They really cover 20 million people. And since February 1, we have indexed monthly cash payments provided to veterans, Heroes of the Soviet Union, Heroes of the Russian Federation, citizens affected by radiation, and citizens with disabilities by 7.4 percent. Funds are already being transferred in an increased amount according to the usual delivery schedule. Traditionally, we have delivery dates, Vladimir Vladimirovich, from the 3rd to the 25th of the month. Accordingly, people already receive these funds.

Among the payments indexed since February 1, there are also measures to support families with children. I will focus on the largest one in terms of coverage – this is maternity capital. The amount of maternity capital, as you have already announced today, is 630 thousand rubles for the first child, and 833 thousand rubles for the second child. That is, the growth compared to last year was plus 57 thousand rubles.

The amount of payments is indexed not only for those who will give birth to a child in the current year, but also for families who received a certificate earlier. At the same time, if the parents used only a part of the maternity capital, then the balance is also indexed here. In total, more than 13 million families in our country have received maternity capital.

Vladimir Vladimirovich, I would like to point out that today at the exhibition "Russia" we hosted a Forum of National achievements, which was devoted to issues of social policy in the interests of children. As part of this large progress report, we presented data on how the coverage of support measures for families with children has changed. So, in 20 years, our coverage with support measures has increased tenfold. Today, 12 million children receive state aid every month.

In addition to social benefits, insurance guarantees have also increased. This was influenced by the growth of the wage fund, as well as the transition to a single rate of insurance premiums. As a result, since January 1, the maximum amount of insurance payments has increased by almost one and a half times, and, thus, the maximum payment, for example, for pregnancy and childbirth today is 565 thousand rubles, and the maximum monthly allowance for caring for a child up to one and a half years – monthly, I emphasize – is 49 thousand rubles [~$545].

Benefits in this amount are already assigned to those who go on maternity or child care leave in 2024. I would like to emphasize once again: this is an insurance payment, its level in each case depends on the amount of earnings.

At the same time, since January 1, on your behalf, a norm has been created that allows you to keep child care benefits for up to one and a half years, even if the mother went to work. This norm is being implemented and is already being applied today.

To provide permanent sources of income for low-income families, we continue to implement the social contract program. According to preliminary data, in 2023 we signed 245,000 social contracts. Thus, we have reached almost 717 thousand of our citizens. Most of the social contracts, more than 80 percent, were in the areas of job search or entrepreneurial activity.

The social contract has shown good efficiency. According to preliminary data, in 2023, more than 70 percent of our citizens increased their incomes, and in more than 41 percent of cases, recipients left the poverty line.

Support is also provided to those citizens who are currently experiencing difficulties in the labor market or have lost their jobs. A new law "On Employment" came into force, which changed the approach to setting the unemployment benefit itself. Its maximum amount from February 1 is set at 13,739 rubles [~$153]. In the future, the amount of this allowance will be indexed annually.

For working citizens, one of the main tools for increasing the level of remuneration is, of course, raising the minimum wage. Since January 1, on your instructions, Vladimir Vladimirovich, the minimum wage has increased by 18.5 percent, and today it is 19,242 rubles [~$215]. The minimum wage directly affects the income of 4.8 million of our citizens.

According to the latest data from Rosstat, real wages in 2023 increased by 7.7 percent. This is largely a consequence of the established job market for job seekers and the increased demand for personnel, especially in the manufacturing sector.

In general, unemployment is currently at a record low, and the number of people employed has increased by 1.6 million over the year.

This active involvement of citizens in the economy has become possible, among other things, thanks to the state employment service. Employment centers work specifically not only with job seekers today, but also with businesses. Our clients include almost all major companies: Russian Railways, Rosatom, KAMAZ, Kalashnikov and many others.

The Work in Russia HR centers ' assistance has become more effective thanks to the service's reboot. Today, we have transferred all processes to a single digital platform "Work of Russia", implemented common standards for the provision of services, and retrained more than 16 thousand employees of employment centers. In 2024, we plan to continue the retraining programs of our employees and involve another six thousand people in this process. To date, as part of the modernization, we have already opened 550 new employment centers, and in 2024 we plan to open another 350 centers in a new format.

In total, the employment service has employed more than 1.4 million applicants over the year. This is mainly the production sector, the construction sector, and the social sector. Moreover, 661 thousand employed citizens directly applied to the employment services and received referrals to specific enterprises. Other job seekers were able to find a job using such services of employment centers as retraining, assistance in drawing up a resume, trainings, internships. So, for the enterprises of the military-industrial complex, we have selected and employed almost 147 thousand specialists today.

Special attention is paid to the employment of citizens with disabilities. Employment centers directly employ almost 54 thousand such applicants, and today we have already identified the so-called, if we can say so, leading regions: These are the Krasnoyarsk Territory, the Volgograd Region, and the Republic of Tatarstan – these are the subjects that show the greatest efficiency in terms of employment of citizens with health restrictions.

Another area of special attention is the employment of veterans of a special military operation. The law provides for a guarantee of preserving the workplace. At the same time, in addition, there is still an opportunity to pass free retraining. The recruitment subsidy program applies to the members of the CBO. For employment centers, we have developed a separate standard of assistance for veterans of special military operations. Last year, 13.5 thousand veterans and family members of fallen heroes were employed in this area.

We work closely with the Defenders of the Fatherland Foundation. We have sent specialists from the employment service, as well as specialists from the Social Fund, to each branch of the foundation. We accompany each veteran and family member of the deceased individually, using all available resources and opportunities of the employment service.

Dear Vladimir Vladimirovich, the report is finished. Thanks

Vladimir Putin: Anton Olegovich, you said that most people are employed after taking these courses, but there is no absolute guarantee. Or is employment guaranteed after all?

Alexander Kotyakov: Mr President, today the effectiveness rate for implementing these courses is 80 per cent. Before applying for training, we conduct an appropriate interview between applicants and the future employer and sign a three-way agreement – between the future employer, the applicant and the educational organization.

Companies already know the educational tracks that we have provided, and the courses are accepted by them. This results in a fairly high percentage of the effectiveness of the implementation of these programs. Of course, we will strive to increase it. There is no absolute guarantee, but today we already have an efficiency of more than 80 percent.

Vladimir Putin: Well, thank you. This is important, and I ask you to pay the necessary attention to it.

One more operational question. We have already noted the efficiency of the construction complex: a record volume of housing construction, such as has never been seen before in our history – more than 110 million square meters. But there is another direction, which at first glance is much more modest, but nevertheless important for people: I am referring to the program of creating a modern urban environment in small towns and historical settlements.

Last year alone, 14 million people took part in this work. Because we did the right thing at the time, we attracted people to choose those projects – small, modest, but very necessary and important for people – to improve the territory of adjacent courtyards and so on. From March 15 to April 30, another contest and another vote will be held.

Irek Envarovich, how is this work being prepared?

I. : Vladimir Vladimirovich! Dear colleagues!

The topic of a comfortable urban environment is very important, of course, for the residents of our country – you have already noted. People want comfortable and modern spaces filled with green spaces, art objects, playgrounds and sports grounds, and places for quiet recreation and socializing to appear in localities.

One of the goals you set as part of the national goals is to improve the quality of the urban environment by one and a half times by 2030. Of course, the main tool is the federal project "Creating a comfortable urban environment", one of the most recognizable and popular federal projects among the citizens of our country.

According to the results of sociological research, 89 percent of Russians are aware of the implementation of this program. In general, since 2017, when the project to create a comfortable urban environment was a priority, more than 111 thousand territories have been landscaped – these are 34,541 public spaces and 76,769 courtyard spaces. Here, on the initiative of the United Russia party, it also worked out. In 2023, 9855 territories were improved, of which 5070 are public spaces.

Of course, the results of the project are seen and felt by millions of Russians. The project provides an opportunity for residents to take a direct part in solving landscaping issues. Based on the voting results, we see a very high level of activity. In 2021, more than nine million voted for a particular space, in 2022-more than ten million, and last year 14.2 million voted. At the same time, 134 thousand residents of new territories – from our new regions-voted.

Today, we have already completed work on almost five thousand public spaces. For example, in Belgorod, Studencheskiy Park became one of the winners of the All-Russian voting in 2022. This work has been completed, as I personally, Vladimir Vladimirovich, was convinced today when I was in Belgorod, and already in September I received visitors. Or Sunny Park, which received 44 thousand votes in Yekaterinburg. It was implemented in two stages and completed in 2023.

Of course, an annual significant event to support the most promising and innovative projects was the landscaping contest, which was launched on your initiative in 2018 at the first Forum of Small and Historic cities in Kolomna. Since 2018, ten competitions have been held, including two for the regions of the Far East, 1027 integrated projects have been selected from 712 municipalities, and 694 projects have already been completed.

Currently, 1,225 localities are potential participants in such a competition, which is more than 40 million inhabitants of our country. Thanks to your support, the number of projects selected annually has tripled, and from 80 projects in 2018, 227 projects are currently being selected in 2023. Also, the maximum number has increased from 100 thousand to 200, and in the regions of the Far East to settlements-more than 250 thousand.

Since last year, residents of the Luhansk and Donetsk People's Republics and Zaporizhia region have been actively participating in the contest. 31 applications were submitted, of which eight became winners, and in the Luhansk Republic this is a very well-known territory of the Molodaya Gvardiya Park in the city of Krasnodon, in the city of Stakhanov – the Gornyak Park. In the Donetsk Republic, in Volnovakha, there is a summer park, in the city of Snezhnoye – a New Height park, in Berdyansk there is a park "Berdyansk – a city in the palm of your hand". This year we are starting to work.

Here, of course, we should note the great help of our regional chefs in implementing these very competitive applications. In general, experts who evaluate the prepared materials note a significant increase in the quality of applications over the past year. This is the result of the formation of professional teams in our regions.

Of course, Mr Putin, we intend to celebrate the work of the best regional and municipal teams, as well as the work of volunteers, with the national award for summing up the results of projects aimed at creating a comfortable urban environment.

Vladimir Vladimirovich, on behalf of the regions, I would like to express my gratitude for your decision to extend this program until 2030. We are preparing a contest, and from March 15 we will start voting in all areas, including a separate team in the Far East. I am confident that this work will be carried out efficiently and completed within the time frame set for our regions.

The report is over. Thanks for attention.

Vladimir Putin: Thank you.

I hope that this work will continue. We have provided appropriate funds for this.

Dear colleagues!

I have already said at the beginning that today I would like to focus separately on an issue that is of particular importance for our transport industry and for all citizens of the country, for improving the connectivity of the country's territories and improving the quality of life of people. As I have already said, and I have already announced it, we will talk about the development of air communication.

Last year, domestic air transport carried over 105 million passengers. The increase was 10.7 percent. This is more than previously predicted, we thought that we would transport about 103 million people.

Almost 83 million people used domestic airlines. Thus, passenger traffic in this segment is more than 13 percent higher than in 2019, that is, the dock-like year.

First of all, I would like to thank the airlines, aircraft crews, and employees of our airports for the result achieved and for their coordinated actions. And I would like to add that reaching this level of transportation also indicates an increase in the tourist attractiveness of our regions and cities, and, of course, the sustainable operation of the domestic economy as a whole.

It is necessary, of course, to maintain the current pace in aviation, to ensure the further steady development of this most important area of modern transport. And for our country, as we all well understand, with its vast territory, this is doubly or trebly important.

Therefore, I expect to hear today not only forecasts on the volume of air traffic, but also what measures are planned to be taken to strengthen the aviation infrastructure, to increase and update the fleet of aircraft. This is not an easy task, I am aware of it, but nevertheless we must work intensively on it – and, of course, as well as on increasing the availability of flights for our citizens.

I would like to discuss the cost of air tickets separately. I would like to emphasize that it is important to avoid excessive growth in ticket prices while ensuring the quality of passenger service and flight safety. These issues should be a priority for both carriers, the Ministry of Transport and other relevant departments.

Further. We are also developing airfield infrastructure: runways, communication points, weather stations, and equipment. In six years, 33 such facilities were put into operation in Russia, including 19 runways. By the end of this year, 13 more facilities will be put into operation.

Today, I would like to report separately on further plans to strengthen the airfield infrastructure, taking into account its current state and plans for the development of air transportation, including intra - and inter-regional ones. I am also waiting for proposals on financing mechanisms for such projects. Here it is important that the additional financial burden does not lead to an increase in air ticket prices.

And of course, our focus is on the development of the domestic civil aircraft industry. I have already mentioned this in passing. This is a serious, high-tech industry, and it requires special attention. Only a few countries in the world are capable of producing a line of modern aircraft, and Russia is one of them.

We have laid out large-scale plans in this area. Please tell us how they are implemented. Of course, I know what is happening there, but nevertheless the purpose of our meeting today is to focus on some issues that require special attention on our part. Therefore, I would like to hear how cooperation has been established in the field of engine construction, other units, materials and components, and what deadlines are planned for the delivery of aircraft.

We have plans already laid out. I would love to hear how they are implemented.

I would like to emphasize once again that Russian aircraft must meet all the requirements for quality, comfort and safety of flights, be truly globally competitive in terms of their technical characteristics, and their transfer to airlines must take place within the agreed time frame, without delays or delays.

I would like to emphasize once again that aviation needs these planes, our citizens need them, and the economy needs them. I look forward to effective cooperation between the Government, Rostec, our aircraft manufacturers, and financial institutions.

Let's get started, we have two speakers-Vitaly Savelyev and Denis Manturov.

As you read, the social issues are also economic issues (what isn’t?), and Russia has budgeted properly for what it plans. The conversation that follows provides an update on Russia’s macroeconomic indicators:

Vladimir Putin: Dear colleagues, good afternoon!

Today, as agreed, we will discuss the current situation in the domestic economy: we will discuss the results of last year, current trends in key sectors and, of course, we will talk about further plans to strengthen industry, finance, foreign trade and the economy as a whole. Moreover, I propose to focus on the immediate tasks and work for the future-in the horizon until 2030.

As I have already noted, last year's economic growth was higher than expected. Russia's GDP has increased, as we previously thought, by 3.5 percent; according to the latest data, by 3.6 percent. This is higher than the global average. The global average growth rate is three percent, and the growth rate of developed economies is 1.5 percent.

It is very important that we have achieved this dynamic, which is primarily based on our internal capabilities. Thus, the volume of industrial production for the year increased by 3.5 percent, while manufacturing industries added 7.5 percent.

In such areas as the production of computers, aircraft, ships, furniture, electrical equipment and motor vehicles, there were even double-digit growth rates. For reference: computers and peripherals – plus 32.8 percent, vehicles, primarily aviation equipment, shipbuilding-plus 25.5 percent, furniture-plus 20.7 percent, leather and leather products- [plus] 12.3 [percent], motor vehicles, trailers, semi-trailers - [plus] 13.6 percent.

The positive dynamics of the real sector and the confident operation of business, in turn, increases the stability of public finances. Last year, the federal budget deficit was 1.9 percent [of GDP]. At the same time, non-oil and gas revenues grew by about a quarter, including in the fourth quarter they were almost half a trillion rubles more than expected. And in January of this year, they added about 85 percent compared to last year's figure. This once again highlights the growing role of non-primary, manufacturing industries.

The January federal budget deficit was 308 billion rubles. Anton Germanovich [Siluanov], as far as I understand, this is much less than last year, right?

Alexander Siluanov: Yes, Mr President, indeed. Last year, in January, large expenditures were made, and, of course, the deficit was significantly higher, there were large advances made for a number of expenditures, so the deficit was significantly higher.

Vladimir Putin: According to my data, we have 1.3 trillion rubles less than last year. This is a serious indicator.

As for regional budgets, they are also generally balanced. Last year, a small deficit was recorded – 0.1 percent [of GDP], and in January, the total budget revenues of all subjects of the Federation exceeded expenditures by 14 billion rubles.

I would also like to note that, according to operational data, economic activity in Russia at the beginning of this year is at a high level. The situation is developing in line with the expectations of the Government and expert circles. So, strong consumer demand remains-approximately as in the fourth quarter of last year. And it is very important that this has a positive impact on the mood and plans of the domestic business.

Of course, special attention should be paid to inflation and its containment. At the end of January, it was 7.2 percent in annual terms. Of course, we know that consumer prices rose by 7.4 percent last year, which means that there was a decline in inflation. Here I will note the joint actions of the Government and the Bank of Russia.

At the same time, against the background of the increase in the Central Bank's key rate – of course, this was a predictable phenomenon – lending also slowed down. So, in January, the loan portfolio of legal entities decreased by 0.2 percent, and individuals, on the contrary, slightly increased – the same 0.2 percent. I know that my colleagues carefully monitor these parameters. Of course, we will talk about this today as well.

The parameters I mentioned, of course, affect the growth rate of our economy both in the short term and in the long term. There are both disadvantages and advantages in everything here – I won't go into details now, we understand this very well. Just to repeat: it is extremely important to maintain a balance between the tasks of development, increasing investment and lending, maintaining employment and ensuring price stability.

I would also like to note that in the coming years, taking into account the challenges facing the Russian economy and the entire global economy, we need a proactive and stimulating policy that will allow us to unlock Russia's industrial, agricultural, transport and high-tech potential at a new level and create and modernize production facilities with modern, well-paid jobs in all regions of the Russian Federation.

Work on the social and economic action plan for the next six years is now entering its final stage. Among other things, it will cover such key areas as investment support, ensuring technological sovereignty, updating and building infrastructure, integrated development of human settlements, and much more. At the same time, our main task, our absolute priority, is to increase the income and quality of life of citizens, as well as the well – being of Russian families.

Once again, I would like to emphasize that in implementing all the plans outlined, it is important to maintain the stability of public finances and adhere to the same principles of ensuring macroeconomic stability as in previous years, which, in fact, allowed us to pass today's tests so well. I ask my colleagues to proceed from these basic considerations.

Let's move on to the discussion.

The Orichevsky district within the Kirov Oblast has developed a basic pamphlet describing Russia’s Social Contract with the above image asking What is it? The following answers the question translated from Russian at the District’s Social Services VK page:

A social contract is an agreement that is concluded between a citizen and the social protection body at the place of residence or stay of the citizen and in accordance with which the social protection body undertakes to provide the citizen with state social assistance, the citizen - to implement the measures provided for by the program of social adaptation.

The program of social adaptation is the measures developed by the body of social protection of the population together with the citizen, which are aimed at overcoming a difficult life situation, and the types, scope and procedure for the implementation of these measures determined by such a program.

A difficult life situation is a circumstance or circumstances that worsen the living conditions of a citizen and the consequences of which he cannot overcome on his own.

Recipients of state social assistance (including on the basis of a social contract) may be low-income families, low-income citizens living alone and other categories of citizens provided for by this Federal Law who, for reasons beyond their control, have an average per capita income below the subsistence minimum established in the relevant subject of the Russian Federation.

The main goal of the social contract is to create conditions for a needy family or citizen to get out of poverty. But not just to give them a livelihood, but to stimulate family members to take certain actions necessary to get out of a crisis situation. In other words, in order to get out of the lack of money, within the framework of the contract, the family receives funds that it will be able to spend only on certain needs and which in the future will help to gain income and other social status.

As we continue our examination of Russia’s development and the implementation of its political-economic strategy/philosophy, we can see how the above explanation plays out in reality. The above was published on 30 March 2021, and its basic formulation has since been built upon in several ways with the overall goal being the elimination of poverty within Russia. It should be easy to see that Russia has taken the basic aspects of the Liberal Social Contracts proposed by Locke and Rousseau and modified them somewhat to eliminate Hobbes’s Leviathan that was employed during the Soviet Era. Hobbes’s world still exists in the form of the Outlaw US Empire and its vassals with the current difference being Russia is now allied with the Global Majority whereas before the USSR was depicted at Godless and mindless—those depiction and associated roles are now reversed even more so with the Empire’s support and participation in the Gaza Genocide. What moral authority the West once had is now gone. For Russia, the challenge is policy continuity once Putin retires from government in 2030 provided a wider conflict with the Empire doesn’t erupt.

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