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The meeting was attended by Prime Minister Dmitry Medvedev, Federation Council Speaker Valentina Matviyenko, State Duma Speaker Sergei Naryshkin, Chief of Staff of the Presidential Executive Office Sergei Ivanov, First Deputy Prime Minister Igor Shuvalov, deputy prime ministers Olga Golodets, Arkady Dvorkovich and Dmitry Rogozin, First Deputy Speaker of the State Duma Alexander Zhukov, Presidential Aide Andrei Belousov, Finance Minister Anton Siluanov, Economic Development Minister Alexei Ulyukayev, Energy Minister Alexander Novak, Accounts Chamber Chairperson Tatyana Golikova, Central Bank Governor Elvira Nabiullina, Chairman of the State Duma Committee on Budget and Taxes Andrei Makarov, and Rosneft CEO Igor Sechin.

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President of Russia Vladimir Putin: Good afternoon, colleagues,

Today, we will talk about issues that concern representatives from all the agencies present here: the Federal Assembly, the supervisory agencies, the Central Bank, the Government Cabinet and our leading businesses, including from the key industry, the oil sector.

Let’s talk about how work is progressing on the draft federal budget and extra-budgetary funds for 2016. This work is about to enter its final stage. In October, the completed draft law should be submitted to the State Duma.

Today, I propose that we focus on the fiscal policy for next year, discuss key outcomes and, of course, reach concrete decisions on the federal budget’s main parameters.

The planned budget deficit for next year should not exceed 3% of GDP. This is one of the most important benchmarks for the Cabinet during the budget process.

Before we begin our work, I would like to identify several priorities.

First, it is imperative to ensure the balance and stability of public finance, and to considerably decrease the federal budget’s dependence on oil prices and benchmarks.

The planned budget deficit for next year should not exceed 3% of GDP. This is one of the most important benchmarks for the Cabinet during the budget process.

In order to reach that level, I ask you to look very carefully at the revenue side of the budget, improving administration and increasing tax collections. At the same time, please remember that we made a decision not to increase the tax burden on businesses.

In the present environment, it is particularly important to provide a set of measures to overcome the economic recession and maintain the role of the federal budget as one of the leading development tools.

Meanwhile, I am asking the Cabinet to look into bringing additional revenues into the budget received by our exporters as a result of the ruble’s devaluation. Naturally, we need to tread very carefully, in order not to weaken the economy of export companies, maintaining their investment opportunities.

Second, the Government’s fulfilment of social obligations to the public should be at the centre of our attention. The federal budget should finance the most important objectives in healthcare, education and science. Government expenditures for these goals should fully meet the needs and demands of society.

Of course, it is also imperative to continue working on improving efficiency in budgetary spending in the social sector. In this respect, I am asking you to accelerate the transition to targeted social support for the most vulnerable categories of our citizens. We have been talking about this for many years. First and foremost, we need to support those who truly need this kind of help.

The federal budget should finance the most important objectives in healthcare, education and science. Government expenditures for these goals should fully meet the needs and demands of society.

Third, in the present environment, it is particularly important to provide a set of measures to overcome the economic recession and maintain the role of the federal budget as one of the leading development tools.

Projects financed through the budget should stimulate economic growth and private investments. I am referring primarily to import substitution programmes in manufacturing and agriculture. I ask the Government to provide regular financing in these areas and particularly monitor the efficacy of these expenditures.

In addition, we must give attention to strengthening the nation’s economic potential, which should include examining the option of recapitalisation for institutions supporting exports.

Fourth, the federal budget should include spending on infrastructure development. We must remove any bottlenecks in problem areas in transportation and the energy sector, eliminating limitations that hinder business activity; in particular, I am referring first and foremost to Russia’s regions. I am talking primarily about implementing plans to develop roads, the railway network, airports and seaports.

Projects financed through the budget should stimulate economic growth and private investments. I ask to provide import substitution programmes in manufacturing and agriculture.

Finally, an important issue I would like to point out is increasing the human and technological potential of Russia’s economy. It is imperative to create new scientific capacity and professional competence, implementing modern systems for professional standards and increasing the quality of labour resources, first and foremost in engineering, which we have also discussed a great deal lately.

These approaches are reflected in the National Technology Initiative, which the Government is working on. Sufficient funding should also be provided for this in the federal budget.

I ask the Government to work through all of the suggestions presented during today’s discussion and to report on when the draft federal budget will be ready for submission to the State Duma.

We know that the economic situation is complicated, but it is not critical. We must make the right, calibrated decisions with the goal of strengthening our nation’s economic potential, and we have everything we need to do this. Our decisions will affect our continued work in the most important sector, whose success we are working towards: the social sector. We must strengthen the economy and use that development to resolve social issues.

Let’s get to work.

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