Agenda: the website of government services and administrative personnel; privatisation of major Russian companies.
Dmitry Medvedev’s opening remarks
Transcript:
Meeting with deputy prime ministers
Dmitry Medvedev: Today I’d like to discuss ways to improve the transparency of government services and the introduction of special information technology. I’m referring to the federal website of government services and administrative personnel. The site is already up at www.gossluzhba.gov.ru. I hope it’ll create new opportunities for those who want to work for government services and help streamline the performance of their human resources departments. Naturally, it’s a challenge to implement these principles in government services because it hasn’t been done before. Probably, this is why we should give an impetus to these efforts in government services at all levels.
As I said, this is a federal resource and will be used to increase the prestige of the authorities at all government levels. It’s important to use this site correctly. The Government Executive Office is playing a coordinating role; the technical issues are being handled by the Ministry of Communications and the methods by the Ministry of Labour.
Mr Prikhodko, how is this site working and what can we expect? Tell us about it, please.
Sergei Prikhodko: Mr Medvedev, you recently approved a concept for the openness of the federal executive bodies and the federal website of government services and administrative personnel was launched on 1 February. Mr Medvedev, you, your deputies and ministers receive letters with questions about government jobs and requests to apply for them. We hope now that the site has become an integrated information system, and there will be fewer questions.
Site users will not only be able to learn about the qualification of government jobs but they’ll also be able to see vacancies at all federal and regional government bodies and send a CV to the respective human resources office (for the initial introduction at this stage). Then every applicant will have an opportunity to monitor the progress of his or her application via My Account. Every applicant can register on the site, create a My Account login and send a CV to the data base. The advantages of listing vacancies on a single information resource are obvious: you no longer have to look for vacancies at all the various department sites – and there are hundreds of federal and regional sites.
Sergei Prikhodko: "Site users will not only be able to learn about the qualification of government jobs but they’ll also be able to see vacancies at all federal and regional government bodies and send a CV to the respective human resources office."
Dmitry Medvedev: So, this database unites all this information, doesn’t it?
Sergei Prikhodko: Exactly. There is a small gap. We are introducing IT everywhere, working in online offices and using electronic signatures. However, we’ve received a lot of documents. So, our next step will be to collect all the necessary documents for vacancies online.
Dmitry Medvedev: Got it. But the most important thing for every applicant who wants to get a government job is to understand how quickly he or she will receive an answer. As they say, a horrible end is better than endless horror. So at some point it’s necessary to make sure that the relevant human resources department sends a reply rather than just sending documents back and forth. Maybe, it’s worth fixing a deadline for deciding human destinies.
Sergei Prikhodko: Mr Medvedev, our regulations will provide for the need to be open with every applicant…
Dmitry Medvedev: But if he has My Account, this is not public information. Sorry, we’ve reviewed your application and you don’t qualify, or on the contrary, come in for an interview…
Sergei Prikhodko: We’ll definitely watch this. And I’d like to make one more point. Working for the further introduction of information and communications technology on this site under the guidance of our coordinator – the Government Executive Office – we’re creating an integrated system of human resources for all government services. It will allow us to introduce new online procedures to work with personnel and streamline the number of employees – there are over 7,000 people in the human resources departments of the various ministries and agencies. When we fully introduce online procedures, we’ll be able to reduce all this.
Sergei Prikhodko: "Working for the further introduction of information and communications technology on this site under the guidance of our coordinator – the Government Executive Office – we’re creating an integrated system of human resources for all government services. It will allow us to introduce new online procedures to work with personnel and streamline the number of employees."
Dmitry Medvedev: This is the right thing to do. Personnel officers are important and necessary but they are very conservative in their mentality. They must know what a computer looks like and how online technology is used. This should be required of those who work with human resources.
Sergei Prikhodko: We’ll follow this requirement.
Dmitry Medvedev: And one more issue to which we’ll come back today. After our meeting I’ll conduct a separate session on the privatisation of major Russian companies. We are reducing state participation in these companies and not only to resolve fiscal issues although this is important (it would be good to sell them for a dear price). We are primarily doing it to make them more efficient and transparent. Eventually, this will reflect on their capitalization and the interest of new long-term investors.
Dmitry Medvedev: "The number of privatization deals has increased a lot in the last few years – by almost three times – because we now pay more attention to this issue. They reached about 300 billion roubles last year. In some cases the final sale price was much higher than the initial price."
The number of privatization deals has increased a lot in the last few years – by almost three times – because we now pay more attention to this issue. They reached about 300 billion roubles last year. In some cases the final sale price was much higher than the initial price. We must yet analyse whether that’s good or bad. On the one hand, if the final price is higher, then the asset is evaluated well, but on the other, maybe this initial price was not correctly assessed. We’ve had such cases anyway. This means that a number of major assets are in much demand on the market.
Judging by the previous period (I’d like to emphasise this), there have been several large offerings, including that of Alrosa that was conducted at the Moscow Exchange in full conformity with international standards. This was the first public offering of shares of a state-owned raw materials company in the past seven years and the biggest IPO in the history of this Exchange. So we tested our Exchange – it works. The world’s leading investors had a chance to consider putting money into this company. I think this is a good sign despite the difficulties in our economy.
With regard to our plans, please keep in mind that they are part of the 2014-2016 privatisation programme, which was approved in July 2013. It includes the sale of shares of major companies, such as Rostelecom, Sovcomflot, United Grain Company and the Novorossiysk sea terminal. We are also talking about prospective sales of shares of other major companies, such as Aeroflot, Transneft and some others. These are all high-quality assets.
Dmitry Medvedev: "Judging by the previous period (I’d like to emphasise this), there have been several large offerings, including that of Alrosa that was conducted at the Moscow Exchange in full conformity with international standards. This was the first public offering of shares of a state-owned raw materials company in the past seven years and the biggest IPO in the history of this Exchange."
We have fairly ambitious plans to receive 200 billion roubles from their privatisation this year alone, and I hope that these plans will be implemented, depending, of course, on the economic situation. We always make this reservation, because the offering price is an important part of the equation. I believe that this is also clear to everyone.
We must prepare companies for sale in advance and conduct so-called presales. We must streamline current activities and costs and determine the right way to sell the shares in the interests of the state and the corresponding industry, as well as the company that is being prepared for sale. All these things must be coordinated.
Working with independent consultants is also important. As far as I know, the main areas of work are covered. Mr Shuvalov, what are we looking at in the near future? Please update us briefly.
Igor Shuvalov: Mr Medvedev, at the same time as you are chairing a series of meetings on the next three years of the budget cycle – 2015, 2016 and 2017 – and while the draft federal law on the state budget is being submitted for consideration to the State Duma, we are presenting the Government’s plans for privatisation.
You have just outlined the main approaches to privatisation. We are working on them together with our independent consultants. All major deals that you mentioned and that we are now preparing have been and will be conducted with the participation of independent consultants and investment agents. The list of such consultants has been approved by a Government decision, and the consultants are instrumental during presales and the placement of shares, that is, throughout the entire privatisation process. You mentioned the figure 292 billion roubles. This is three times more than in 2011. Back then, we managed to collect 110-111 billion roubles by the end of 2011, and here we have 292 billion as of late 2013. We have placed the shares of the Vanino Commercial Sea Terminal. You have mentioned ALROSA, which indeed was an important trial project for us. We did a good job selling those shares and we’ve gained some positive experience.
Igor Shuvalov: "During the next three-year cycle, which includes 2014, the Ministry of Economic Development and the Federal Agency for State Property Management will make preparatory steps to sell shares of Rostelecom, Sovcomflot, United Grain Company and the Novorossiysk Commercial Seaport. As you said, we may go ahead and sell some shares of Transneft and Russian Railways as a trial."
During the next three-year cycle, which includes 2014, the Ministry of Economic Development and the Federal Agency for State Property Management will make preparatory steps to sell shares of Rostelecom, Sovcomflot, United Grain Company and the Novorossiysk Commercial Seaport. As you said, we may go ahead and sell some shares of Transneft and Russian Railways as a trial.
All these years, we’ve been learning to sell property in a new way. Of course, we are now doing a great deal, unlike during the early privatisation of the 2000s or the late 1990s. We are talking about entirely different amounts of money from the sale of assets now. We are being asked all the time why we are not fully...
Dmitry Medvedev: …carrying out the plan.
Igor Shuvalov: … implementing the plan.
Dmitry Medvedev: I was about to mention this, but go ahead and say it now.
Igor Shuvalov: We are constantly being asked why the Government doesn't fulfill its plans with regard to the businesses that are included in the privatisation list. The answer is simple: when the market is not ready to pay a fair price for a particular asset, we do not make such a privatisation deal. We believe that several factors should come together, such as a fair price and a good investor who will either bring new know-how or better management capabilities to the table. Or, it might be a technical investor for the issuer...
Dmitry Medvedev: Money wouldn’t hurt, either.
Igor Shuvalov: …money to the federal budget. Of course, we do not always sell exclusively for the money that goes to the federal budget. Some of the deals we are now discussing, including Sovcomflot, will have some of the proceeds going toward the development of the company. These transactions are becoming increasingly complex. Take the Sberbank deal, for instance. The placement of the Sberbank shares was postponed on several occasions, because the market was unable to come up with a fair price expected by the Government and the Central Bank. In the end, though, the privatisation was carried out very successfully. Of course, we are trying to privatise the enterprises that we have on the list within the indicated timeframes. However, if we do not have all the pieces of the puzzle in place, we delay such deals until we have everything straightened out.
Igor Shuvalov: "The placement of the Sberbank shares was postponed on several occasions, because the market was unable to come up with a fair price expected by the Government and the Central Bank. In the end, though, the privatisation was carried out very successfully."
On top of it, privatisation in Russia cannot be considered separately from the rest of the world, developing countries and even countries with a good privatisation track record, such as Brazil and others. We must compete for the global capital that is involved in privatisations. We have real competitors, so it's not just about the Russian risk and the Russian interest. It is also about the assets that are offered for sale in other countries and other markets. However, so far we’ve been able to... Not exactly gain the upper hand in this competition, but we've definitely been able to find our own niche with our transactions.
The Minister of Economic Development and our other colleagues will report to you about it today. I believe that we will do well in 2014-2015.
Dmitry Medvedev: All right. You have correctly identified approaches to privatisation. Indeed, they should be properly balanced. We should not procrastinate, but we should also be mindful of the economic situation in the world and in Russia, and make sure that each time we sell those assets at a fair price. This is the way to go. We’ll discuss this in greater detail during the meeting on privatisation.
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