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One of the goals the President set in his Budget Address in June this year was to reduce over the next three years the number of federal civil servants by up to 20 percent.

Mr Medvedev noted at the meeting that optimising the number of civil servants should not turn into simply a mechanical reduction, but must be linked together with redistribution of powers among the various bodies and levels and setting up the necessary mechanisms for identifying optimum numbers of civil servants.

The President instructed the Government and the Presidential Executive Office to prepare forecasts for optimising civil servant numbers over the next 3 to 5 years taking into account the budget’s financial possibilities.

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President of Russia Dmitry Medvedev: Colleagues, we have been talking for quite a while now about the need to optimise the number of civil servants. This is one of those tasks that the state authorities always should address. There is never an ideal number, rather, we are always aiming towards an optimum number, but in real life getting there is far from straightforward, and indeed, seems more often to take the opposite track to what we want, in accordance with various social laws, including Parkinson’s famous laws: bureaucrats will always find work to fill the time they have available for its completion.

But on a serious note, we do need to look at the civil service organisation we have today, look at the situation in our civil and military agencies and in the law enforcement too.

A modern state can only operate effectively when it has the right kind of support required to keep it running. This means qualified specialists able to resolve the tasks the country has before it today, and these are very complex tasks indeed.

But we realise too that optimising the number of federal civil servants – something I spoke about in my Budget Address, and something the Government has discussed on a number of occasions too – is not simply about mechanically reducing numbers. Of course, this is part of the work, but more important is redistribution of powers between the different organisations and levels, and establishing the necessary mechanisms that will then help us to work out the optimum numbers we require.

We also cannot lose sight of the fact that we are living in the electronic era and we have been designing for some time now an e-government. I hope that we will successfully complete it one day, and some of the services currently performed by civil servants will eventually be all carried out online. But this is a separate issue.

Some functions and services are clearly unclaimed and have become obsolete and superfluous, while performing such functions still requires considerable effort and administrative resources, so we should reflect on what kind of situation we want to arrive at, taking into account too the fact that some state agencies – not just civilian agencies but also military agencies – are starting to make use of outsourcing, that is, transferring some responsibility for carrying out some work to third parties. In a number of cases this has produced some very good results. I stress that this concerns not just civilian organisations but also military and law enforcement agencies.

New areas of state regulation are emerging. We need to make competent use of our human resources and employ modern technology. It should also be examined how to finance all of this tasks. The various state agencies must constantly correlate their structure and civil service posts to the tactical and strategic objectives set by state policy.

In conclusion, I want to say that the aim is not simply to trim our civil servant numbers by 20 percent, although such cuts are sometimes necessary. Wherever we make cuts, as you will have noticed during your work in the Government staff or Presidential Executive Office, six months pass and the numbers are already back up to the old levels again. In this sense, cuts are essential from time to time simply to keep staff levels from swelling too high. But of course, the most important thing is to increase efficiency both of our civil servants and the state organisations in which they work.

Mr Kudrin [Deputy Prime Minister and Finance Minister Alexei Kudrin], I would like you to brief me and everyone here about the open points regarding optimisation of federal civil servant numbers and about what has been done so far, because this idea came partly from the Finance Ministry too, originally, and I was told that the Government then discussed it. So what have you accomplished so far? You have the floor.

Deputy PRIME MINISTER AND FINANCE MINISTER ALEXEI KUDRIN: Mr President, acting on your instruction and the Budget Address, the Government, in the draft budget for the next three years, has planned and approved with the different ministries and agencies a timetable for reducing the number of federal civil servants. As things stand today, we have around 510,000 federal civil servants employed in all of the different organisations, including the judicial system.

There are about 420,000 people working in the federal executive system at the moment. In accordance with your Budget Address, all of these different agencies will optimise their numbers of civil servants.

We expect that the reductions will affect more than 100,000 federal civil servants over the next three years. The total amount of money saved over this period will come to 43 billion rubles a year [around $1.4 billion] by 2013.

Dmitry Medvedev: So, again, the total reductions will come to…

Alexei Kudrin: The total reductions will come to more than 100,000.

Dmitry Medvedev: More than 100,000…

Alexei Kudrin: We expect the total may reach up to 110,000, with aggregate savings reaching 43 billion rubles in 2013.

(The Minister then presented the specific measures proposed for reducing staff numbers in ministries, and gave some figures on the changes in the numbers of civil servants over recent years.)

Dmitry Medvedev: What I want to get clear is that our state is changing and we are carrying out reforms. But do we actually have an overall idea of the number of civil servants that we need now to carry out all the various state functions?

This is probably a question not so much for Mr Kudrin, because he is responsible for financial matters, and these issues should not be forced to fit with the financial parameters we set, but, on the contrary, we are to base financing on the optimum staff numbers that are settled.

Has anyone been working on this in the Presidential Executive Office and the Government staff?

Alexei Kudrin: I can answer this question.

Dmitry Medvedev: Go ahead.

Alexei Kudrin: Mr President, of course we make a thorough inventory and analysis of all state functions. If any law, order or resolution gives powers or functions to specific ministries and agencies we take this into account. The Finance Ministry is indeed not responsible for this work, but the Government in general and the Presidential Executive Office, and so the relevant empowered commissions carry out this analysis and optimisation work.

What I can tell you is that over the last four years 1,468 functions were recognised as superfluous (I am not talking about their scale but about specific powers and functions of specific ministries). Almost 1,500 functions, in other words. A further 263 were recognised as duplicating other functions, and 868 required substantial change and clarification. Their content needs to be stated more clearly. Of course, we also take these facts into account in our financing plans and when determining the optimum staff numbers for the different ministries and agencies.

Dmitry Medvedev: This is good. But I want to know, has anyone identified at least approximate numbers of civil servants required to perform specific duties? I realise that you are working on optimising the various functions themselves, but what about the overall numbers of civil servants?

I recall that at one time we had a commission in the Presidential Executive Office (I set it up myself when I worked in the Executive Office), and later I think it was Mr Sobyanin [Deputy Prime Minister and Government Chief of Staff Sergei Sobyanin] who supervised this, and Mr Naryshkin [Chief of Staff of the Presidential Executive Office Sergei Naryshkin] was also involved.

What’s the situation now?

Deputy Prime Minister and Government Chief of Staff Sergei Sobyanin: The Government also has a commission, the commission on administrative reform, carrying out analysis of the various powers within the executive power system. This work has become more intensive over the last six months. For example, the analysis of the Federal Service for Veterinary and Phytosanitary Supervision (Rosselkhoznadzor) allowed to implement considerable changes in the agency’s powers that will lead to human resource changes that will ultimately most likely result in thousands of employees losing their positions.

This kind of analysis is being made now for most agencies. I think that over this year we will complete this work for all agencies, and most likely the changes in agencies’ powers will lead to real reductions in staff numbers in addition to the figures already given. There are no theoretical estimates of the optimum correlations between the different functions and the required staff numbers. There are probably very few such calculations in the world, and they are very abstract.

Current numbers were formed on the basis of the functions that exist today. This is a product of historic development. We are planning these reductions of 20 percent, but we will not end this work there. In accordance with your instructions, the Presidential Address, and Government resolutions, we will continue moving forward in this direction, and I think that this will lead to additional reductions in the future.

Dmitry MEDVEDEV: On the one hand, we have to remember that these are our colleagues and in many cases are qualified professionals, and we cannot simply make cutbacks for the sake of purely mechanical transformations, as I said. But at the same time you are right in noting the weight of history behind this, and we are now reforming this legacy, reforming more in some areas and less in others. Looking objectively at the situation, looking at the big picture, numbers have increased over these last years, except in isolated cases when earlier decisions, including Security Council decisions, were carried out, and those decisions too have not been implemented in full yet. Overall, though, numbers have increased.

I am not saying this is good or bad right now, but I simply want to understand how much we actually need this. Of course this is not an exact science, but there must be some kind of recommended numbers. Calculations have been put together by the International Labour Organisation and various other specialised organisations, and we should pay closer attention to this work, take a more thorough methodical approach.

I think we are to look at the future, look at the objectives we want to reach in 3–5 years, say, taking into account the changes underway here. We are currently reorganising the Interior Ministry, for example, and this will involve substantial personnel cutbacks and trimming of various posts. This is probably the most vivid example at the moment, but it is not the only one. There are many such examples. We need to calculate all of this, take it all into consideration. I therefore propose that the Government and Presidential Executive Office will draft forecasts in this area so that we can get an idea of where we are going, and of course financial forecasts too, because we need to look at how we will back up the different functions with the necessary money.

This is agreed then.

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