Vladimir Putin: Mr Artemyev, I would like to start with an issue that our citizens are constantly raising. As you saw, I received questions about it during the Direct Line. People believe that the tariff increases in many regions are unjustified.
Let us start with this. Please pay special attention to this matter and then we will discuss other issues.
Igor Artemyev: Mr Putin, indeed, for many years the Russian Government has not raised tariffs above the inflation rate. Essentially, it is an ‘inflation minus’ rate.
This is what has been happening for many years, but in the 1990s laws were passed that left exactly 12 ‘loopholes’ in the legislation allowing municipalities and regions to have legal grounds for going beyond the rates set by the Government, which is exactly what happened. For example, in 2016 there were 1,423 such cases, after which the number started to decrease. In 2018, there were 498 cases.
As per your instructions and the Prime Minister’s instructions, these ‘loopholes’ have been patched up. The Government issued a resolution regarding housing and utilities that prohibits setting the tariffs in excess of the Government rates. Also, the State Duma passed amendments to the law on electricity.
Whenever the tariff is lower than is economically justified and it is necessary to increase the tariff slightly over the inflation rate, permission from the Federal Anti-Monopoly Service will be required and we will be fully responsible to you for our actions. The thing that has been going on for 20 years due to the 1990s laws has come to an end.
Vladimir Putin: Not quite.
If it were really over, people would not have been complaining via the Direct Line.
Igor Artemyev: And another matter. I would like to report on the implementation of your instructions on fighting cartels.
Today we estimate the damage from cartel agreements in various commercial organisations, auctions and the economy in general at about two percent of the GDP.
You have issued corresponding instructions.
Vladimir Putin: Two percent of the GDP?
Igor Artemyev: Yes. There are thousands of cartels; most of them are in the pharmaceutical industry and road construction. There is collusion in 80–90 percent of state auctions.
We identify this together with the law enforcement agencies. Today about 15 criminal cases are open and several of them are already closed; some people got real terms.
The new law on promoting the fight against cartels that we have developed together with the law enforcement agencies has been discussed with all the entrepreneurial unions, and their comments have been taken into consideration.
We have coordinated it with all [the federal executive agencies], now it is being submitted to the Government and then to the State Duma.
It will probably be adopted in the autumn; but your instructions are of principal importance to us, and we are implementing them, so perhaps it is time for everyone to realise that the party is over.
It is a great evil that damages the national economy today, so we must fight it, and, of course, the new law will make it possible for us and our colleagues in the law enforcement agencies to do this more effectively.
Vladimir Putin: Good.
We will have to analyse the legal practice and see what the real picture looks like.
Igor Artemyev: Right.