Agenda: Expanding the programme to support major investment projects in priority sectors, increasing aircraft engine production, the implementation of the Labour Productivity national project.
Meeting with deputy prime ministers on current issues
Mikhail Mishustin’s opening remarks
From the transcript of the meeting:
Mikhail Mishustin: Good afternoon, colleagues.
The Government continues to improve the conditions for investors to ease the burden on them and alleviate the aftermath of external sanctions. A resolution has been signed that expands the programme to support major projects in priority sectors.
Entrepreneurs will be able to invest less of their own resources in the implementation of these projects. This share will be reduced from 20 to 15 percent for projects adopted this year and next. Entrepreneurs will be able to borrow the rest of the sum from banks. To that end, we are increasing the total funding that VEB.RF can provide to borrowers via relevant applications, from the current 300 billion roubles to 500 billion roubles.
They will also have the opportunity to launch a new investment cycle based on existing companies, without creating additional legal entities.
These measures will improve the accessibility and attractiveness of project financing in our country, and increase bank loans for those organisations that create the advanced production facilities that are important for the development of the Russian economy.
Amid the external sanctions and restrictions, it is necessary to reduce the dependence of aircraft on foreign materials, parts and equipment to the maximum extent possible. It is important that our airlines are able to renew their fleets using contemporary Russian-made solutions.
We will expand production of aircraft engines for the entire range of domestic civilian and military cargo aircraft as instructed by the President. The United Engine Corporation will be able to use more than 44 billion roubles in federal funds for these purposes.
The industry has been given very clear tasks in this area. Within two years, they need to produce around fifty PD-8 engines, which will be needed to equip the Superjets. And also, twenty PS-90A engines are required for Tu-214 medium-haul aircraft. And finally, fourteen PD-14 engines are to be installed on the future flagship of Russian aviation, the MS-21.
At the same time, all the planned research work on the PD-35 heavy-duty engine is to be completed. It's important to complete the development and creation of the prototype of this unique power plant by the end of 2024, as we agreed when we visited the Perm production site last year.
Mr Manturov (speaking to Denis Manturov), we need to do everything necessary to make sure the deadlines are met. I know you are dealing with this issue. Please, keep it under your personal control.
One of the most important factors for the development of domestic production is increasing labour productivity. The Government has been implementing the relevant national project over the past five years.
Its main objective is to increase the efficiency of Russian enterprises, which involves improving staff skills, optimising the use of internal resources and, of course, introducing the most advanced technologies and practices. This is particularly important in the current environment. The national project has already involved all regions of our country and some 1.5 million workers.
Many enterprises now have to rebuild their logistics and commodity chains, and enter new markets. And the competitiveness of their goods and services there will determine their success and speed of adaptation to the current challenges.
Mr Reshetnikov (referring to Maxim Reshetnikov), tell us more about how the national project is being implemented. What results have you managed to achieve? I know that Mr Belousov is overseeing this project very actively. Please take the floor.
Maxim Reshetnikov: Mr Mishustin, colleagues.
The national project on labour productivity has more significance under the current circumstances. The project makes it possible to boost corporate efficiency without a major investment on the part of the business community. It basically only requires competent managerial decisions.
The national project experts at the regional and Federal Competence Centres help companies optimise processes, including putting their internal resources and capital to more efficient use, engaging in trouble-shooting, reducing unnecessary inventory, and eliminating downtime and other losses.
This helps increase production volumes, improve financial indicators, and creates conditions for wage growth. We use federal funding to teach skills and create pilot projects, whereupon businesses replicate these skills and competences on their own.
As far as results are concerned, we are seeing that the lean-production tools are working. As of today, 2,300 companies who have implemented the project in 2019, 2020, and 2021, have increased their earnings by more than 60 billion roubles. I am referring only to the pilot projects that are based on budget funding.
This is more than four times what the government has invested in supporting these companies. But if we look at the entire additional contribution of the companies that used these pilot projects, it exceeds 380 billion roubles over three years. I mean, these are quite visible figures in the macroeconomic sense, because the national project not only helps to implement separate projects and measures but also changes a company’s manufacturing culture.
And we are seeing increased corporate demand for participation in the national project. We plan to cover 3,600 companies by the end of this year, but now we have 4,000 participants with another 2,000 having submitted applications or who are waiting in line.
The growing role of the regions should be noted. The dynamic development of the project is largely their achievement because, in addition to the Federal Competence Centre, we are expanding the network of regional competence centres, which now number over 60. The regional centre specialists are holding training sessions at companies.
In addition to the federal measures, many regions have launched regional programmes (as a rule, these are about subsidies for equipment purchases), and they use regional industrial development funds to expand their loan programmes. All of these programmes are coordinated.
Let me stress once again that the national project’s role is much greater than just process optimisation, because it leads to a new long-term culture of high labour productivity, rather than a one-time improvement. When on business trips we don’t just visit companies where the project is getting started, but also those that have already implemented it.
For example, on Saturday we visited to the Grass Company, Russia’s largest producer of automotive chemicals and cleaning products, in the Volgograd Region. The company was among the first to join the national project in 2018, and they introduced lean production practices on three lines. As a result, equipment efficiency was increased by one-third, and output per shift by 40 percent. After that, the company replicated these solutions on its own; due to this and to the proactive use of other support tools, it managed to both maintain and increase production during the pandemic. The region, by rescheduling its budget loans (this is another tool we use to help the regions), has created new company facilities; by 2024, they plan to build an automated storage facility (the project is under way), which will create over 1,000 new jobs.
In the current situation, where foreign brands are leaving the cleaning products market, the company has decided to expand and will start producing shampoos, toothpaste and gels by the end of the year. This means it is preparing to meet domestic demand for these products. It is also looking for new sites in other regions and at exports.
There are many examples like this – dozens in each region.
We visited Yaroslavl recently to see a packaging materials producer. Thanks to the skills taught by the Labour Productivity national project, it does what it needs to do promptly, and it is flexibly replicating its production approach.
In the Sverdlovsk Region, the national project has helped increase the output of intensive care incubators for newborn infants. In Mordovia, an antibiotics producer is starting a new medicine production line in December. This production line has also been optimised based on the national project. So, in our experience, the national project is very effective.
What else is important in the current circumstances? The national project itself is also developing.
We are seeing businesses and regions join this so-called movement to improve efficiency, and experts whose technological solutions and unconventional approaches are being introduced in corporate practice. Today, there are some 10,000 efficiency consultants at companies, and it is planned to increase this number to 100,000 before 2024. This is a resource that can also strengthen Russia’s technological sovereignty.
Mr Mishustin, given the national project’s efficiency for businesses and the economy, the participation criteria have been expanded at the regions’ request and under their obligations. We discussed this with Mr Belousov, and the decision has been taken.
We have lifted restrictions on industrial company participation for backbone companies and others with revenue exceeding 400 million roubles under the regions’ commitments to achieve an increase in labour productivity.
Right now, the Economic Development Ministry is drafting proposals to extend and expand the national project beyond 2024. We think this is extremely important.
It is also important to open the project to housing and utilities companies, tourism, sanatoria and health resorts, and healthcare institutions. If the decision to extend and expand the national project is approved, it will help double the number of potential participants in the national project.
We ask you, Mr Mishustin, to support these initiatives and take them into consideration as the decision to extend the national project is prepared.
Mikhail Mishustin: Thank you, Mr Reshetnikov. Of course, this work should be continued. It is very important to increase the number of industries that use these measures. This will make it possible to continue building up our industrial capacity, achieve a more confident development of the economy as a whole, and strengthen this country’s technological sovereignty. And of course, this will have a positive effect on our people’s quality of life.
