Agenda: Extending insurance payment respite for some companies, the implementation of the programme to modernise utility infrastructure, the performance of the construction sector in 2022, the work of the hospitality industry during the New Year holidays and further plans for its development.
Meeting with deputy prime ministers on current issues
Mikhail Mishustin’s opening remarks
Excerpts from the transcript:
Mikhail Mishustin: Good afternoon, colleagues.
Last spring, at the President’s instruction, the deadline for making insurance payments was extended by 12 months for some companies. For those who have already received this assistance, the Government has extended the respite. It relates to the second quarter of 2022 for some companies in healthcare, science, culture, tourism, sport, food production, textile production and other socially important industries. Overall, it will apply to 70 areas of activity. Such organisations had to make payments before the end of April 2023, and now they can do it until 28 May 2024.
Individual entrepreneurs working in these sectors have received a respite for payments accrued in 2021 on the revenue that exceeds 300,000 roubles. They can also make payments before 1 May 2024. Companies engaged in 30 areas of activity, including pharmaceutical companies and those working in agriculture, construction and telecommunications, can make insurance payments for the third quarter of 2022 before 28 May 2024. This measure will help businesses continue using available resources to cover operational costs, first of all, salaries, as well as to develop and modernise production and adjust logistics.
Let us move to another issue. The Government continues to help regions renew their utility infrastructure. The President emphasised that flats and houses, as well as industrial and social facilities must have a reliable supply of heat and water everywhere, in each city and town.
This year, we will allocate 30 billion roubles and next year – another 100 billion roubles for the replacement and constriction of new water, heat and sewage networks, as well as boilers and other heat facilities, subject to mandatory co-financing by Russian regions.
This programme was prepared at the instruction of the President as part of the Strategy for Developing the Construction Sector and the Housing and Utilities Infrastructure. Overall, the construction sector shows good results and is developing actively.
Mr Khusnullin, please tell us how the utility system modernisation programme will be implemented. And please, tell us in more detail about the work of the construction sector in 2022.
Marat Khusnullin: Mr Mishustin, colleagues.
Thanks to the constant attention of the President and the adopted system-wide solutions, as well as the Government’s prompt work and your personal participation in all issues related to construction, close interaction with the Presidential Executive Office, the Federal Assembly and work with regional heads and their teams, the construction sector has been showing positive dynamics in the past three years despite the sanctions and the coronavirus pandemic. In 2022, the most significant results were achieved on key indices.
First, the Strategy for Developing the Construction Sector and the Housing and Utilities Infrastructure of the Russian Federation until 2030 and the outlook for 2035 has been approved. This document was discussed in detail at the meeting of the State Council Presidium and was supported by all regions. The construction and utilities sectors’ main mission is the creation of comfortable living conditions for citizens and contributing to the country’s economic and technological sovereignty.
First, I want to say that we have already seen that the construction sector has grown by at least 6-6.5 percent in the past year. Second, the contribution to GDP will be no less than 0.5 percent, just like the strategy envisioned. What is very important is that this is a comprehensive document that connects all areas of construction: housing, commercial, infrastructure, industrial, as well as all kinds of programmes and funding at all levels of authority.
Second. In 2022, over 101.5 million square metres of housing will be commissioned, which is 10 percent more than in 2021. By the way, the 2021 results were the best since the Soviet Union. This made it possible to improve the living conditions of 3.6 million families.
There is also growth in all the main indices of the urban development sector, including the construction permits, urban development solutions that make it possible to start designing residential buildings. The total volume is 402 million square metres, which is more than in 2021. Permissions for the construction of 50 million square metres were given, which is 23 percent more than in 2021 and almost twice as much as in 2019. It shows that demand and supply on the market are quite stable and are growing.
The development of the mortgage market, including through programmes with state participation, plays a special role in improving living conditions. The difficult economic situation has affected the mortgage market. The portfolio reduced to 2 trillion roubles; in 2021, it grew by 2.5 trillion roubles, and in 2022, by 2 trillion roubles. At the same time, mortgages gave a boost to the development of housing construction. This came about as a result of the decision that we made after discussing all possible solutions to extend a mortgage – to create a mortgage incident and extend the 8-percent preferential mortgage until 1 July 2024. The expanded family mortgage for families with two children has allowed another million of families to improve their living conditions.
Last year, a decision was made to begin the implementation of preferential 2 percent mortgage programmes for purchasing housing on the markets in our new territories.
Under the programme to relocate people from dilapidated housing until 1 January 2017, 2.8 million square metres were relocated in 2022, which is 15 percent more than in 2021. Thus, 168,000 Russian citizens received new housing with 13 regions completing the current programme ahead of schedule. Nine of the regions began relocating people from dilapidated buildings before 1 January 2022.
The approval of a five-year plan worth 13 trillion roubles, together with regional budgets, became a key event in the road construction sector. Its implementation will make it possible to improve 85 percent of the road network, or 136,000 kilometres handling the most passenger and freight traffic.
To obtain the greatest synergy from road development projects in 2022, we have signed memorandums with 84 Russian regions. These documents make it possible to link federal and regional networks and to improve these roads on a priority basis.
In 2022, we resurfaced 30,000 km of roads, and built or reconstructed over 1,600 km. Federal and other investment totalled 1.8 trillion roubles.
In 2022, we covered regional roads, including those in the four newly incorporated territories, with 173 million square metres of asphalt. This is a seven percent increment on 2021, which was a record year. Consequently, 49.7 percent of regional roads now meet pre-set standards.
Under the national project, we should reach a level of 50 percent by late 2024. Almost 80 percent of roads in 105 agglomerations meet the relevant standards. We will also complete this work by late 2024.
In 2022, the President of Russia approved the Russia route that includes the West-East transport corridor between St Petersburg and Vladivostok. Mr Mushustin, we have already built the first 107 km of the M-12 Vostok Motorway, launched as per your instructions two years ago, between Moscow and Kazan. We are confident that the entire route will start operating before the year is out. In 2024, it will reach Yekaterinburg and Tyumen, and this will become the fastest national road construction project in the entire history of Russian road construction.
We have repaired the Crimean Bridge in record time. Despite the terrorist attack, it took 57 days to resume traffic along the bridge. It usually takes 12 months to complete such work.
Road traffic safety levels are improving. The number of road accidents and casualty statistics continues to dwindle each year. We are reducing these statistics by 5-6 percent on average. In absolute terms, road accident fatalities fell by 713 compared to 2021, and 9,000 fewer were injured.
Active work continues to improve the efficiency of capital investment management. The change in the structure of capital investment management resulted in our cash execution for 2022 exceeding one trillion roubles for the first time, which is 320 billion more than in 2021. And the actual spending was 96.1 percent, which is almost 10 percent higher than in 2021.
In line with the President’s instructions, the Government approved a comprehensive construction programme, which includes a federal targeted investment programme, for the next three years. This construction programme involves moving to a five-year capital investment planning horizon, maintaining a flexible capital investment management system and expanding the mechanisms for advanced construction and the early completion of facilities. Currently, work is underway to prepare a list of such facilities that can be completed ahead of schedule in 2023.
Regions have a wide range of financial instruments, the so-called infrastructure menu, at their disposal for infrastructure development. A programme of infrastructure budget loans is underway. It should be noted that we launched a total of 900 projects in 83 regions in 2022, worth one trillion roubles in total, divided into four years. Moreover, the first stage of the programme (250 billion) was completed and financed by 99 percent last year, with 30 facilities already opened.
The President has also instructed us to allocate an additional 250 billion roubles.
A programme to finance infrastructure projects using infrastructure bonds has been launched: 33 projects worth 101 billion roubles were approved in 17 regions. This is a new programme. It was also decided last year to allocate 150 billion roubles, of which 101 billion has already been put into operation. The President gave instructions to bring this programme up to 300 billion. We are now preparing the mechanism together with the Ministry of Finance, and we will submit it to you in the near future.
In 2022, the programme to upgrade utilities infrastructure at the expense of the National Wealth Fund began; it is worth about 150 billion, of which more than 130 billion has already been put into operation. In total, all this money, plus the 130 billion that we have allocated for 2023-2024 to upgrade the utilities sector, will make it possible to launch a new comprehensive programme for the development of utilities infrastructure. The key issue is to reduce the accident rate, as well as reduce wear and tear and related losses in the networks, which will improve quality and make it possible to hold rates steady in the future.
We are planning to approve a five-year programme with the regions.
In order to improve the quality of the urban environment, over 22,000 public spaces and 32,000 courtyards underwent improvements. Mr Mishustin, last year you were at a beautification competition, for the second year in a row, and you know this topic well. And the decision that has been made to increase funding from 10 billion to 20 billion will, of course, make it possible to increase the number of improved areas and make our cities and towns more comfortable.
Work continues to reduce the duration of the investment and construction cycle. The amount of data, documents, materials and approvals that can be requested from the developer in the course of a construction project has gone down from 989 to 751. This will reduce the project implementation time from 1,831 days to 1,574 on average.
Major work is also underway to restore social, utilities and transport infrastructure in the new territories. Extensive work has already been carried out, with a large number of builders involved. Over 8,000 facilities have been reconstructed, repaired and built in new territories. We are doing this actively.
Mr Mishustin, for 2023, you tasked the construction industry with achieving results not lower than the level of the previous year. We will make every effort to ensure that the construction industry and the housing and utilities sector remain drivers of economic development and contribute to improving the quality and comfort of the living environment for citizens and the stable development of infrastructure, despite external factors. We aim to continue to ensure the positive growth of the construction industry, as well as the fulfillment of the tasks set by the President and the Government. We also plan to maintain the positive trend of tax revenue in the budget system and fulfil the tasks of integrating and developing the infrastructure of the new territories.
Mikhail Mishustin: Thank you, Mr Khusnullin. Building and repairing network infrastructure is, of course, a huge job. We need to help as many regions as possible to carry out the implementation of the Presidential initiative. Please take this under your personal control.
One more question. During the New Year holidays, many families travelled around the country. Russian regions have significant potential in the tourism sector. We continue to develop this through support for small businesses so that people have more options on how to spend their free time interestingly and usefully. We create the necessary infrastructure for tourism, including family tourism, whether it is an active holiday in the mountains of the North Caucasus or the Urals, or a cultural and educational trip to historical places, or visits to museums, architectural monuments of our cities.
Mr Chernyshenko, please elaborate on what opportunities Russians used in the domestic hospitality industry during the winter holidays. And of course, on further plans for the development of the industry, so Russians can have a quality holiday in the country.
Dmitry Chernyshenko: Mr Mishustin.
The winter season is indeed ongoing, but many people have already taken their vacation during the New Year holidays, and most importantly, they spent it comfortably and safely in their own country.
It is clear that domestic tourism has increased in almost all directions. According to the data provided by the Ministry of Economic Development, during the winter holidays more than 12 million people travelled, or 10-15 percent more than last year. Hotel occupancy was also higher than last year on average, from 70 to 95 percent.
In addition to the traditional leading destinations – Moscow, St Petersburg, Kazan – tourism has increased in a number of other destinations.
Over 3 million people went to the ski resorts in the North Caucasus, Sochi, the Sakhalin Region, and Sheregesh, as well as resorts in the European part of Russia and the Urals, or 10 percent more than last year.
People have begun to choose their own and neighbouring regions for winter holidays, as we can see.
Separately, I would like to note that New Year trips to Moscow and other regions were organised for children from the families of military personnel taking part in the special military operation and the new territories.
Stays in new modular hotels, which are being built under the new Government programme, were also in demand. Over 1,000 rooms in different regions have already opened and are receive guests. This year we plan to expand the programme, which will make it possible to co-finance construction together with the regions. This has proven to be effective.
As for transport, there is also interesting news. This winter we are seeing an increase in traffic, in particular, over the New Year holidays, with 3.4 million people travelling by rail, which is 20 percent more than last year.
And thanks to the Government’s support of the aviation industry, it was possible not only to maintain, but also to increase tourist trips by air by 11 percent, or a total of 2.2 million people.
Mr Mishustin, I would like to note once again that interesting vacations were organised safely and were held regularly in all Russian regions.
I will briefly talk about the plans for developing the tourism industry.
This year, the Ministry of Economic Development will continue to implement the activities of the Tourism and Hospitality Industry national project. I emphasise that this will also apply to the new territories. We will quickly integrate them, as instructed by the President.
There also are very important presidential projects: the More Than a Journey programme on the Russia - Land of Opportunity platform and the Znaniye Russian society. Last year, there were 55,000 participants; this year we will be able to encourage more than 70,000 people. And we will increase funding for this from 2 to 3 billion roubles.
Mr Mishustin, last year we launched a pilot project to develop school tourism in 18 regions in line with your instructions. It includes cultural and educational trips. It is extremely important that children visit historical places and military glory sites. Last year, more than 100,000 children took part in the programme, and half a billion roubles were allocated for it. This year, on your instructions, we have doubled the subsidy to the regions, as well as the number of participants.
The President instructed us to speed up the creation of tourism infrastructure. And we continue to implement the largest projects in Altai, the Far East and other regions with resources of the Tourism.RF corporation.
The President spoke about the importance of developing beach recreation last September at the State Council Presidium meeting on tourism. This year, we are launching a new large project called New Anapa, the biggest tourism project in the history of Russia. It will be a national family year-round resort.
The City Tourist Code programme will help make the historical centres of our cities more accessible and attractive. Over 6 billion roubles will be allocated to the regions for it this year, and another 1.5 billion for grant support of entrepreneurial initiatives in the sphere of tourism.
Minister of Economic Development Maxim Reshetnikov is doing a great deal of work. He uses serious tools to support and develop business for the tourism industry. We are already hearing a response. For example, there is a special financial product with a loan term of up to five years, a maximum loan amount of up to 50 million and a rate of five percent for the tourism industry.
The new programmes will also affect the international block for making contacts with friendly countries in order to increase the mutual tourist flow.
Mr Mishustin, last year you also introduced zero VAT for hotels.
All this and much more has become an incentive for the development of the service sector in the tourism industry.
I would like to note that the comprehensive decisions of the Government to support the tourism industry provide for a growing number of hotel rooms, despite all challenges. So the tourism economy is growing and even outpacing the economy in general in the country.
Mikhail Mishustin: Thank you, Mr Chernyshenko. The industry is actively developing, and measures to support people and tourism businesses are expanding.
It is very important that such state support be aimed at improving service and developing infrastructure in all Russian regions.
This will create more opportunities for comfortable, safe travel for our people. Attention should remain on children's holidays in order to make it more accessible to children, including those from the new Russian regions.
